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Second Quarter 2016 & Third Quarter 2015 Bar Edition

Second Quarter 2016 & Third Quarter 2015

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Page 1: Second Quarter 2016 & Third Quarter 2015

Second Quarter 2016 & Third Quarter 2015

Bar Edition

Page 2: Second Quarter 2016 & Third Quarter 2015

OverviewBeer: includes bottled and draftLiquor: includes all liquor products including open liquor (assumed 30% cost)Non-Alcoholic: Includes soda, juices, craft sodas, coffee products and teas (iced and hot)Wine: Includes all wine and corkage. Wine analyzed at per glass averages (i.e. BTL = 5 glasses, .5 BTL = 2.5 glasses)

Page 3: Second Quarter 2016 & Third Quarter 2015

Time Frames•Second Quarter 2016• 1st of April – 17th of June•67 Days of Business

•Third Quarter of 2015•1st of July – 30th of September•92 Days of Business

Page 4: Second Quarter 2016 & Third Quarter 2015

Alcohol and Beverage Comparison

Items 2016

Daily AVG 2015 Daily AVG Diff % Change

Beer 6194.28 92.45194 6403.89 69.6075 22.84444 33%

liquor 12701.29 189.5715 13111.37 142.5149 47.05663 33%

Non Alc 3007.71 44.89119 4448.81 48.35663 -3.46544 -7%

Wine 14849.99 221.6416 12505.69 135.9315 85.71019 62%* Table of bar profits by item type

Page 5: Second Quarter 2016 & Third Quarter 2015

%Change: Beer: +28.4% Liquor: +26% Non Alc: -2.29% Wine: +53%

* Wine Units in GL

Page 6: Second Quarter 2016 & Third Quarter 2015

%Change : Beer: +33% Liquor: +33% Non Alc: -7% Wine: +62%

Page 7: Second Quarter 2016 & Third Quarter 2015

Average Profit Per Drink (Q2.2016)

Beer Liquor Non-Alcoholic Wine*

$4.43 $7.31 $2.86 $7.65

*GL, BTL, .5 BTL all averaged to per GL profit

Page 8: Second Quarter 2016 & Third Quarter 2015

Overview SummaryOn Any given day wine accounts for 40% of total bar profitsFollowed by liquor @ 35%Beer @ 17%And non alcoholic @ 8%

Page 9: Second Quarter 2016 & Third Quarter 2015

WineALSO KNOWN AS HOW THE BAR MAKES MONEY

Page 10: Second Quarter 2016 & Third Quarter 2015

Wine OverviewHighest average profit per glass @ $7.65Most frequently sold alcoholic beverage on average @ 29 glasses per day and highest average daily profit @ 22262% increase in profits from last yearBy the Glass sales most profitableCommon Varietals more frequently purchasedPattern of varietals sold largely similar between quarters

Page 11: Second Quarter 2016 & Third Quarter 2015

*BTL, .5 BTL and GL reduce to GL counts*Data labels refer to customer cost per glass

Page 12: Second Quarter 2016 & Third Quarter 2015

Wine Profit by Varietal

Price per glass doesn’t greatly impact sales

Fairly even distribution between white and red wine drinkers

*Data label refers to customer price per glass

Page 13: Second Quarter 2016 & Third Quarter 2015
Page 14: Second Quarter 2016 & Third Quarter 2015

Profits by Volume SalesAVG Profit per GL per

BottleAVG Profit per GL

per .5 BTLAVG Profit per Glass

$6.57 $7.08 $8.42

*Mark up from cost is the same but rounding benefits per glass sales

Page 15: Second Quarter 2016 & Third Quarter 2015

Wine SummaryThere may be an upper limit for price point for customers (i.e. Zinfandel Sales down perhaps due to Seghesio price point; other retired high point wines)Varietal familiarity likely determines choice before pricePerhaps more flexible in pricing for known varietals, less so with uncommon onesQualitatively: while some customers want a foreign wine (specifically Rose and Prazzo), many Europeans request local wines. Maybe list state and region on wine list?

Page 16: Second Quarter 2016 & Third Quarter 2015

LiquorWHERE CRAFT IS KING

Page 17: Second Quarter 2016 & Third Quarter 2015

LiquorSecond highest average profit per drink @ $7.31Second highest average volume in sales @ 25 per daySecond highest average daily profits @ $190 a dayPrickly Pear dominates despite being $12 a cocktailFinancial and Brand incentive to favor craft cocktails vs conventional cocktail

Page 18: Second Quarter 2016 & Third Quarter 2015

Craft vs ConventionCraft Cocktail AVG Profit Per Drink Conventional Cocktail AVG Profit Per Drink

$8.33 $5.70

*Craft cocktail order worth approximately 45% more than ordering off menu on average

Page 19: Second Quarter 2016 & Third Quarter 2015

Cocktail-Other: -7% Craft Cocktail: +51%

Page 20: Second Quarter 2016 & Third Quarter 2015

Comparing Off Menu Cocktail

ProfitsIncrease in Scotch and

after dinner drinksPreference for cheaper

vodka and whiskey off menu

Beehive G&T similar to Sage Mojito

Consider another whisky or Vodka craft cocktail with cheaper ingredients but more favorable profit margin Scotch: +75% AD: +240%

Page 21: Second Quarter 2016 & Third Quarter 2015

Craft Cocktail Trends

Prickly Pear continues to dominate despite being $12

Perceived ‘sweetness’ may influence customer choice over price

Craft Cocktail profit margins range from $6.50 (Walters) to $9.90 (Ancho)

Page 22: Second Quarter 2016 & Third Quarter 2015

Liquor SummaryOpen liquor a black hole in cost/profitSweeter craft cocktails preferredCraft cocktail much higher profit margin than conventionalWhen going off menu, customers prefer vodka

Page 23: Second Quarter 2016 & Third Quarter 2015

BeerNOTHING TO DRAUGHT ABOUT

Page 24: Second Quarter 2016 & Third Quarter 2015

Beer OverviewThird top seller @ 21 Beers per dayThird top average per drink profits @ $4.43Third top average sales profits @ $92 per dayDraft beer more popular

Page 25: Second Quarter 2016 & Third Quarter 2015

Comparing Draft and BottledBeer sales up

primarily through draft

Draft beer accounts for 72% of Beer profits

Bottled: +17% Draft: +40%

Page 26: Second Quarter 2016 & Third Quarter 2015
Page 27: Second Quarter 2016 & Third Quarter 2015

Beer Sales Volume

Common practice to charge equal amount for draft or bottle beer when it’s a craft beer

$1 increase in draft equals a 16% increase in average daily beer profits

IPA highest bottle sales, consider IPA draft

Page 28: Second Quarter 2016 & Third Quarter 2015

Beer SummaryThird top seller but with substantially lower profit margin compared to wine and liquorDraft preferred to any specific bottle by large marginAdvisable to raise price of draft $1Limits on profitability; however draft has better profit margin potential and beer cocktails may increase per beer profits

Page 29: Second Quarter 2016 & Third Quarter 2015

Non-AlcCOFFEE OR TEA?

Page 30: Second Quarter 2016 & Third Quarter 2015

Non-Alcoholic Drinks OverviewLowest average profit per drink @ $2.86Lowest average volume of sales @ 16 units per dayCoffee biggest profit source, primarily after dinner drinks• Espresso, Cappuccinos popular with European crowd

Sharp decline in fountain soda sales, acceptable considering higher sales of alcohol?

Page 31: Second Quarter 2016 & Third Quarter 2015
Page 32: Second Quarter 2016 & Third Quarter 2015

After ThoughtsWine is biggest profit portion of bar; local and familiar varietals sell bestCraft cocktail is a higher profit margin to conventional; considering adding a sweet vodka or whiskey drink Draft beer accounts for majority of beer sales; considering increasing price $1After Dinner drinks (both alcoholic and coffee) sales are increasing and good source of additional non competitive income