Demystifying Prime Costs: Rethinking the 55% Rule for Bar Profitability

The Bar Business Podcast

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Ever wondered why your bar isn't hitting that golden 55% prime cost target? This week on the Bar Business Podcast, I reveal why this number isn't the be-all and end-all for every establishment. You'll learn how factors like location and occupancy costs can shift the goalposts, and why tailoring your approach is crucial for your bar's financial well-being. I'm not here to preach textbook strategies; we're diving into the real-world implications that make or break your bottom line.
Accounting can be a headache, but it's the lifeblood of your bar's success. As your host, Chris Schneider, I break down the nitty-gritty of prime cost management, showing you how to separate your expenses into crystal-clear categories for a laser-focused view of your financial health. From mastering the art of differentiating beverage costs to embracing tools and expertise that streamline your financial tracking, this episode is your ticket to data-driven decision-making that can dramatically improve your business. But wait, there's more! We're peeling back the layers on prime cost management within the hospitality sector, discussing everything from the intricacies of labor cost categorization to the complexities of third-party delivery service fees.

Welcome to the Bar Business Podcast, the ultimate resource for bar owners looking to elevate their businesses to the next level. Our podcast is packed with valuable insights, expert advice, and inspiring stories from successful bar owners and industry professionals. Our mission is to help you thrive in the competitive bar industry and achieve your business goals.
Thank you to our show sponsor, SpotOn. SpotOn's modern, cloud-based POS system allows bars to increase team productivity and provides the reporting you need to make smart financial decisions.
**We are a SpotOn affiliate and earn commissions from the link above.
Thank you to our benchmarking data partner Starfish. Starfish works with your bookkeeping software using AI to help you make data-driven decisions and maximize your profits while giving you benchmarking data to understand how you compare to the industry at large.
Learn More:
The Bar Business Podcast Website
Schedule a Strategy Session
Chris' Book 'How to Make Top-Shelf Profits in the Bar Business'
Bar Business Nation Facebook Group

Chapters

1. Understanding Prime Cost in Bars (00:00:00)

2. Understanding Prime Cost in Accounting (00:07:53)

3. Managing Prime Costs in Hospitality (00:16:49)

4. Managing Bar Costs and Revenue (00:27:58)

5. Bar Business Podcast Community Building (00:39:00)