Where Is Your Bar Stock Going? 10 Common Causes of Inventory Loss
Updated: Oct 25
A bar can hit its sales target and still lose margin through stock that was purchased but never converted into recorded revenue. The warning sign is often a persistent gap between actual cost of goods sold and theoretical cost of goods sold.
That gap is inventory variance. It can come from overpouring, waste or theft, but bad stock counts, outdated recipe costs and incorrect POS mapping can create the same result. Before blaming the team, the numbers themselves must be tested.
This guide explains how bar inventory variance works, the ten most common causes of a positive variance, and the order in which each cause should be investigated.
Understanding bar inventory loss: actual and theoretical COGS
Theoretical COGS is what the bar should have consumed based on the items sold and the standard cost attached to each recipe.
Theoretical COGS = Sum of units sold × standard recipe cost per item
Actual COGS is what inventory records show was consumed during the same period.
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