The Rule of Thumb - The Power of 3

November 20, 2014

Our lives are consumed by the number 3!

We win, loose, judge, consider, select, discard, all based on this number!

Some examples:

3 is also crucial to a bar business as it’s the key to growing, winning and operating profitably!

When one considers the impact of the power of 3, the thought changes to “drinks philosophy”!  Don’t worry this is not a conversation about the pros and cons of Pre or Post prohibition style drinks , it’s an understanding based on  building a model inclusive of supporting engineering process and metrics.

The Bar Rule of Thumb…

There’s a direct relationship between guests spend, individual drinks sold and contribution margin towards a venues costs.

A great guide to understanding in easy terms the impact… consider overhead and expenses in terms of 3 drinks sold to one guest.

Remember a drink purchased by one customer, and then repeated, may not always mean a bar is making a profit.

Each Rule of Thumb has its own drill down with arising impact:

A One drink Philosophy

The focus is on SPEED! Quality, consistency, possibly service may take second or third place as it’s all about VOLUME. Being brilliant at getting it out quick is key as guest churn is high! This business may be characterised by consequences such as rising wastage, lack of care and possibly high staff turnover! If this game is not won through unbelievable costs controls, process and execution, it’s easy to just tread water! Let’s face it whose in business just to pay wages!

A Two drink Philosophy

The focus changes from slinging it out to looking at ways to drive profitable revenue opportunity, by encouraging the guest(s) to stay longer/spend more. Quality, consistency, guest experience becomes something to focus on. Less money can be spent on driving the numbers, more emphasis on customer retention. As spend per guest rises, the contribution margin required to cover remaining venue costs gets closer and closer to break-even.

A Three drink Philosophy

The focus here is detail: heightened guest experience, service levels, quality, perception of value, consistency. Greater investment can be made on the bells and whistles encouraging guest retention, larger spend! Supporting processes and activities will be built around engineering this business outcome, with rising profits to show for the effort.

Defining what your business is or aspires to be; measure by the Bar Rule of Thumb, it’ll change the way your business runs!

To your success!

  Subscribe in a reader





Leave a comment


Also in News

Uberbartools copper jigger for accurate cocktail measuring
How the jiggers took a u-turn

June 27, 2019

Not all jiggers are made equal when it comes to accuracy. Look more closely at that round jigger. If you fill it to the top for a full measure, you'll notice a bubble forms. This is called meniscus and that can lead to bars wasting liquor and losing profits...

View full article →

Riesling Ricky Cocktail Recipe
Riesling Ricky Cocktail Recipe

June 07, 2019

With Aussie Riesling and Manly Gin, this is summer spritzing done right!

View full article →

How the StrainRay got it's name
How the StrainRay got it's name

May 25, 2019

Inherent design flaws have been passed down through generations of strainers, leading to problems that bartenders have just learned to live with. Average Hawthorne strainers rust and some are uncomfortable to hold, and that's before you get to the problems with straining – springs that are not wound well or tightly won't strain the liquid effectively, thereby ruining an otherwise well-made cocktail and creating waste. Which is why we designed the StrainRay...

View full article →