News from Minnesota Municipal Beverage Association

Minnesota Municipal Beverage Association Newsletter

(February 3, 2012 - February 9, 2013)

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As I See It...

Challenges

Challenges.

The challenges we face in our businesses are coming from every direction.

Competition: We all have had new challenges affecting our business in one way or another. They may or may not be in our cities, but they impact the way we run our business. In my area there has been a single stand alone liquor store that has created some buzz over the last year and there have been some chain stores (Pharmacy/ Big Box) opening liquor stores in the area over the last few years.

Legislative: Our legislative branch of government is firing on all cylinders. This week brought Governor Mark Dayton's State of the State address. There are talks about how to reduce the deficit and cut spending, including possible changes in our state sales tax and which businesses will be paying more or less tax. Oh and then that minor issue and talk of proposed legislation regarding Sunday Sales

The above challenges affect all of us. The time to get started is now. What are you planning to do to make your store more profitable? How are you planning to be involved in the legislative process that regulates our industry and your future.

Do you want to learn more, including ways to improve your store and your skills as a manager?

It's not too late to contact MMBA and join us for Boot Camp at Breezy Point, February 18th -20th

Happy Valentine's Day (What are you having on special?)

Michael Friesen

Hawley Liquor

Controlling Bar Food Costs

By George Barton

There is a lot more to controlling food cost in the bar area that one would assume.

Controlling food cost must be an all-out team effort. All managers as well as team members play a key role to ensure your guests receive only the best produced products that are prepared the right way.

Here are 5 key deliverables and procedures to ensure bar food cost controls are top of mind while enhancing quality at the same time.

1. Order It Well

You must place accountability on who is responsible for costs and who orders your inventory
Pars should be set to align with sales mix (adjust with sales fluctuation)
Fresh cut produce is critical so insure high level of comfort with vendor
When possible, teach this process to new managers and key team members

2. Receive It Well

Request to receive product early AM or off times and not during lunch or dinner rush
Review against P.O. (purchase order) to ensure you're not out of stock
Make changes on "out of stock" and adjustment prices on the spot. Do not wait.
Management orders product so management should receive and have staff store product quickly (use scales when appropriate)

3. Make it Well (To the recipe)

Whether slicing oranges and limes or making the soup of the day, recipes must be followed (don't assume)
When prepping, follow production levels set by management. Levels should be monitored continuously
Ensure team members are working in a safe and clean environment (no bare hands contact)
Education on use of equipment, especially sharp knives, will save you $$
Build shelf life and sensitivity guide for all products and code containers

Juices / Ice Cream / Puree's / Syrups / Sour Mix / All Fresh Produce

4. Don't Let It Die on the Bar Top

Line check bar food consumables is as important as line check in your kitchen
Management should have proper timetable to support tasting and line checks
Rotation of products is critical. First in, first out and include this in line check
Ensure staff does not eat bar garnishes (blue cheese stuffed olives are not free)
Use par system (Place fresh product out for the shift only, then restock)

5. Sell It Well (First Time Every Time)

Cover your products cost in the price you charge the customer
Guests "eat with their eyes" so make your garnishes look impressive
Insure finished product is delivered to guest the way you invented it

So in review, food cost makes up the largest portion of your gross profit. With strong team accountability, follow up and the practice of bar food cost controls, you can ensure that costs are in line and positively impacting margins in your business.

Sales Tax on Free Liquor

This week a member asked:

If a liquor store owner wants to give a customer a free bottle of wine, is the sales tax calculated on the wholesale cost or another amount? If it is the selling price, can't that number be manipulated?

According to the Minnesota Department of Revenue:

If a liquor store owner gives away a bottle of liquor, then the liquor store owner owes use tax on their cost of the liquor. The liquor store owner would owe the 6.875% state general use tax rate, plus the 2.5% liquor gross receipts use tax rate and any applicable local use taxes. The use tax would be reported when they file their sales and use tax return.

A Doctor & Patient Chat....