F&B managers have lots of ways of thinking about efficiency and output at their operations. Many choose to think about efficiency in terms of ‘shrinkage’, while others consider ‘lost profits’. We think there is a better way to understand and measure operational efficiency: Yield. What do we mean by Yield? Simply put, Yield is the amount of revenue produced by a given quantity of liquor, such as a bottle. If you know your bottle cost, and measure how many drinks your bartenders poured from that bottle, you can calculate the Yield on that bottle. And, based on our experience with over 100 customers, nobody achieves 100% Yield. (In fact, the average among our incoming clients is just 65% or so) But you can improve your Yield, using Capton! Many of our clients see 10, 20, 30 point improvements in Yield. Want to learn more? Contact our experts today.
Do you know your true beverage costs? Here is a simple equation for you to use:
((Beginning Inventory + Purchases – Ending Inventory) / Sales) = Beverage Cost
This figure, expressed as a percentage, is a key component in calculating your overall profitability. Other costs include labor, overhead, etc.
As you can see, in order to get an accurate measure of your beverage costs, you need to measure inventory. How much you had on hand at the start of a particular period (a week, a month…), how much you purchased in that same period, and how much you sold during that period. Performing this calculation on a regular basis, say each week, will give you the most accurate picture of your beverage costs. And, of course, using Capton’s beverage management system is a great way to capture some of the data you’ll need for these calculations!
A recent article in Hospitality Technology magazine describes the role of Revenue Management technology in helping hospitality managers maximize their ROI. Naturally, those managers are focused on selling out their inventory of rooms at the highest possible rate. At Capton we have applied those same principles to our beverage management system, giving managers the tools and information they need to maximize yield from every bottle of liquor being poured. Learn more at www.captoninc.com or contact us today.