09/19/2026
How do you track and manage your bar inventory?
How do you track and manage your cash?
Is it the same?
It should be.
Attend my seminar this coming Monday, October 19th at the Ohio Bar Owners Association Trade show at the Hollywood Casino in Columbus, Ohio! My seminar is at 2pm.
Then stay for the trade show from 3pm to 7pm. Stop by our booth and say Hi!
What appears on your financial statements and your tax return? Dollars / cash or inventory numbers? Cash and dollars do.
How do you balance your cash drawer and your bank statment? You compare what you brought in to what you should have brought in by comparing those two values with the actual cash counts, deposits, payments and withdrawals. This is what all owners do and should do. They initially learn this process from an accountant / CPA.
Here is where for a lot of owners go wrong in tracking their inventory. They look at percentages or trends in sales and costs used.
They do nothing at all, except to track their inventory usage to figure out how much to order. They might compare that usage to the total sales dollars for the week. But what are they comparing? Actual usage to actual sales. That's it. How is that like comparing how much cash actually did come in (From the counting of the cash drawer) to how much cash should have come in? (From the cash in drawer report or the Z tape)
They are not tracking their inventory use and sales like their cash and consequently, will end up "missing" more inventory and sales then they realize.
On average, when owners don't use the correct method of comparing how much inventory is used to how much inventory is sold on the product mix report, the average loss is about 15%. When you do compare your actual inventory use to the ideal amount of usage (as defined by the product mix report) you will end up knowing your true inventory loss. With this information you can bring your losses down from an average of 15% to less than 3%.
To do this type of analysis, you need an inventory management software program to do the analysis. An excel spreadsheet won't cut it!
You have to count the inventory accurately, track the purchases and use the product mix report from your POS system. You will have to have recipes set up in the system with the ideal quantities for each menu item. And you should do this analysis weekly.