Whether you manage a pub or nightclub, the challenges of running a successful bar go far beyond just keeping customers' glasses full. You need to ensure that you're well stocked, serving tasty drinks, creating events to excite potential customers, and protecting yourself from any potential liabilities. While managing a bar may be difficult, we broke it down into 8 simple steps to help you make a profit from your bar business.
8 Steps to Run a Bar Successfully
Whether you own a bar and want to improve your profits or you're considering starting a new bar, following these 8 steps to learn how to run a bar.
1. Keep Your Bar Stocked
Keeping your bar stocked goes far beyond just filling your back bar cooler or refrigerator with beer, liquor, and wine. You will want to track what drinks your customers are drinking and which types of alcohol you're using more often than others. This will allow you to adjust your orders, so you spend less money on alcohol that's less popular while keeping your bar filled with the popular items.
Essential Items Every Bar Needs
Stocking your bar or nightclub is also more than just the liquor and beer itself. Here's a list of things that you should always have on hand in your bar:
- Bar napkins
- Straws and stirrers
- Mixing glasses
- Cocktail shakers and strainers
- Liquor pourers
- Cocktail mixes
2. Measure Your Liquor to Reduce Over Pouring
While an extra-strong drink may not seem like an issue, consistently over pouring drinks can end up costing your bar hundreds of thousands of dollars in the long run.
Fortunately, there are ways that you can measure your pouring and prevent waste in your bar. Here are a few examples of how your bar can prevent over pouring and waste:
- Use measured pourers. Measured liquor pourers make it easy to approximate portions and help prevent spillage to eliminate the risk of wasted product.
- Teach bartenders to use jiggers when crafting cocktails. Using jiggers when crafting cocktails not only prevents overpouring, it also ensures that your customers get a consistent drink each time.
- Choose the right glassware. Using the right glassware can also help reduce your liquor costs. Heavy-base glasses have a thicker bottom, so you don't have to use as much liquid to fill them as standard glassware, which will result in savings over time. These bar managing tips can not only help you reduce waste in your bar, but they can also ensure consistency, which is key for keeping your customers happy and coming back to your bar.
3. Create Signature Cocktails
While many customers may order popular drinks like rum and coke or an Old Fashioned, creating drinks that are unique to your establishment gives you a competitive edge over other bars. Additionally, if you create your own craft cocktails, you can price them higher than traditional beverages, helping to increase your profit margin.
When creating new recipes and cocktails, you want to consider your target demographic and their tastes. For example, if you're near a college campus and have a customer base in their mid-twenties, you'll want to design strong cocktails that use liquors like rum, vodka, or tequila. On the other hand, bars with older customers may want to use top-shelf liquors like fine whiskey or bourbon in their recipes.
When managing a bar, it's also important to keep on top of current drink trends and offer customers something new, like spiced or fruity vodka infusions. You can also up your cocktail game by adding unique garnishes to your drinks, like fruit kabobs in daiquiris.
4. Host Happy Hour and Events
Hosting a happy hour is a great way to draw customers in with low prices. Then you can let your delicious cocktails and excellent service convince the customers to stay past happy hour and pay full price for your items. Your happy hour menu should feature discounts on items with a high profit margin, group specials, snacks, and designated driver discounts to maximize your profits.
Another option to bring customers in to your business is to host events. Events can be a one time thing or they can become a regular occurrence, which is a great way to build a regular customer base that can help your bar succeed. There are many different types of events that you can put on depending on your clientele and establishment's theme. Here are some popular options:
- Speed dating
- Arcade or game nights
- Tailgating or sports parties
- Open mic nights
Schedule your weekly events to target specific times and demographics, such as the post-work business crowd, weekend brunch goers, or sports fans before, during, or after a big game. Additionally, be sure to advertise your happy hour specials on social media, outdoor signs, and posters in your front-of-house space.
5. Hire the Right Bartenders
The bar industry has a very high turnover rate, which results in lots of money wasted on training new employees. Your bar can prevent this by implementing strict standards when hiring and creating a rigorous training regimen that weeds out any potential bad employees early in the process.
One of the best ways that bar managers can retain good employees is with incentives, such as bonuses, favorable shifts, or pay raises. But, not all incentives have to be monetary. Some employees are instead motivated by the potential for promotions or learning new skills. For example, if you have a dishwasher who is dedicated to working hard but who also wants to learn bartending skills, reward them by offering some training and allowing them to bartend during slow periods of business at first.
Another essential aspect of keeping your employees happy is ensuring that you're promoting a comfortable atmosphere where your staff feels welcome to share their ideas and concerns. If employees don't feel like their concerns are being heard by the general manager or the owner, they'll leave. Additionally, if you engage in dialogue with your staff, you can learn more about them and how you can keep them happy and working hard.
6. Train Your Bartenders and Wait Staff to Upsell
A great way to boost profits in your bar is to train your staff to upsell customers. Upselling involves your bartenders or wait staff suggesting that customers try a specific high-value item or add it onto their order. Upselling is beneficial for both your business and your staff, because bigger checks mean bigger tips.
The key to upselling is to frame it as a personal suggestion. For example, instead of offering your customers an expensive alternative to their order, have your bartender tell them that the alternative is their favorite drink or it's a new special that's really good. Framing the sell as a suggestion will make your customers more likely to try the more expensive option.
Also, be sure to keep your food menu in clear sight of patrons. Patrons might approach your bar doors with just drinks in mind, but after a round or two, that appetizer menu strategically placed in front of them might start to look tempting. You can also boost sales by offering food and drink pairings based on common flavors or contrasts.
Educate your staff on the best food and drink pairings. What beers go well with your appetizers? What wines pair best with your desserts? Offering knowledgeable suggestions will be viewed as helpful rather than a sales pitch. Lastly, train staff to detect undecided customers. If someone has glanced at their menu for an extended period of time, a simple "Can I suggest one of our specials?" can help sway them.
7. Invest in a POS System
An essential for any successful bar, an electronic Point Of Sale (POS) system organizes orders and keeps track of transactions. These order and receipt systems ensure smooth communication between the waitress, bartender, and kitchen to help keep track of customer tabs on even the busiest of nights. It also allows bar managers and owners to see the breakdown of sales by employee. POS stations run from $2,000 to $5,000, so research the best POS system for your business before purchasing one.
8. Take Liability Seriously
Alcohol service is a risky business. When managing a bar, you should train staff to handle alcohol-related safety issues, not just for the safety of customers who have consumed too much alcohol, but to protect your bar from fines, imprisonment, loss of liquor license, increased insurance costs, and even losing your business.
If your establishment serves alcohol to a minor or visibly intoxicated patron, not only will you face criminal fines, but you can be sued in civil court for damages that person causes after leaving your bar. Many new and smaller establishments skip liquor liability coverage to cut down on premiums or are simply unaware of coverage, so know the specifications of your insurance.
Look to trusted, established alcohol training resources to effectively teach your staff. The National Restaurant Association offers ServSafe Alcohol training to prepare bartenders, servers, hosts, bussers, valets, bouncers, and all front-of-house staff in the event of safety and liability issues. State Liquor Control Boards also offer initiatives that teach bar staff how to recognize signs of intoxication and detect fake IDs.
The bar industry is very competitive, and it can be difficult to run a bar successfully due to the razor-thin profit margins. But, by taking a more active role in your business, ensuring that your bar is stocked with everything it needs, and training your employees for success, you can help your bar become profitable and succeed.