A Quick Lesson in Inventory
MY
LEAST FAVORITE PART
of being a sommelier in a restaurant was inventory
management. It’s not the most sexy of topics. In fact, it’s
usually downright boring. I have many not-so-fond memories
of coming in on a Sunday morning after a very late and busy
Saturday night to count bottles. Or getting a call on my day
off from my boss saying the beverage numbers aren’t working,
could I come in and count bottles again?
Keeping on top
of the inventory is a chore that few people enjoy, but it’s
a necessity to running a tight beverage program. In my
experience, errors in inventory are quite common and can
lead to significant “leakage” in the company books at even
the best restaurants. I’ve found such errors in every
program that I have been newly responsible for, and have
been able to decrease the beverage cost in one month by as
much as 11% via inventory management alone. I’d like to
share a few common errors that throw off percentages and
numbers at the end of the month.
The first and
most common mistake happens when the bottle comes in the
door and there is some confusion about entering it correctly
into inventory. You might have the correct producer, but the
wrong appellation, or maybe it’s a reserve bottling and the
regular level price is entered, or perhaps you have the
correct general appellation but the vineyard is wrong. All
of these would lead to misalignment between your records and
actual costs. One such entering-error I’ve found over and
over again is pack size. Watch out for this. It’s one of the
easiest problems to solve, but one of most frustrating to
find in retrospect. Any difference in pack size, even for
the exact same product, has to be listed as a separate line
item, with a different price and a different bottle count.
Discovering that the case of $8OO Cabernet in your inventory
came in a 6 pack and not a case of 12 will show up in your
beverage cost. This often happens from one vintage to the
next. You’ll also see it frequently with half bottles, which
have been known to appear in 24, 18, 12, or even 6 bottle
cases. And look out for “broken” cases, meaning that the
number of bottles that should be in the case is less than
the size of case. The sample bottles do get pulled from
somewhere, and it might be from the box you
received.
A mixed case
from the same producer but of different vintages and
vineyards is also something to take note of. I remember a
situation with a mixed case of Domaine Romanee Conti in a
hotel that I once worked at. After it was taken from storage
and put onto the wine list it wreaked havoc on my beverage
cost until I discovered how it was listed in the inventory:
“DRC mixed: 1” vs. the individual vineyards that I had
listed on the wine list and inventory. It was no surprise
that accounting took issue with a $3OOO case of “DRC mixed”
wine that was missing. Luckily it was just hiding, split
into multiple bins as a multitude of other wines. (As a side
note, it is definitely worth including the person who does
the books at the end of the month in your wine classes. It
enables them to help you identify and solve
problems.)
Spoilage is
another area that can be overlooked. For example, the last
glass in a bottle of wine is turning to vinegar and has to
be thrown out, but the “lost” glass isn’t noted. Or a bottle
that is corked is returned to the distributor, but the
credit isn’t noted in the inventory. The irony of this is
that for the beverage cost, it’s counted against you – even
if you’ve had a credit back – because the bottle is now
mysteriously missing from inventory.
Human error is
the last factor I’ll mention. First, I’ve learned the hard
way to do the physical inventory in pairs to minimize such
factors as missing bins after a break, not seeing a case and
miscounting the number of bottles in the bin. Confessing
from personal experience, these are very easy mistakes to
make after a couple of hours at cellar temperature. Another
part of human error is keeping the POS system up to date.
Vintage changes, different bottlings by the same producer
and confusing POS descriptions all factor into incorrect
sales figure, thereby inflating the cost. Whoever is
responsible for the wine program should take care to update
the POS system regularly – not fun, but essential. If it’s
put off for months, it becomes overwhelming and the
likelihood of mistakes escalates.
WITHOUT
A DOUBT, inventory
is one of the most mind numbing aspects of the job. But it
is a necessary evil. Running 1O points over budget easily
taints an otherwise successful month. However, with some
diligence and perseverance, you can isolate and resolve the
problems. It’s a chore that really pays off.
