Your Best Seller Is Not Your Best Product

Sales went up and the margin went down. It is one of the more annoying things a set of figures can tell you, and the explanation is usually not price, or waste, or theft.

It is what people bought.

Carry the example through

Two drinks. One sells at £5 and returns £3.50. The other sells at £6 and returns £3.60. Barely a difference — until you look at what that does at volume.

Sell 1,000 of the first and you take £5,000 with £3,500 of gross profit: 70%. Sell 1,000 of the second and you take £6,000 with £3,600: 60%. Sales up by a fifth, margin down by ten points, and nobody did anything wrong. The customers just changed their minds.

Now do it across a whole bar, over three months, without noticing.

Our regular reporting shows a league table your top revenue generators; and your top margin generators.

The mix moves quietly

Cocktails grow because they photograph well. Draught slips because the weather turned. A wine list gets refreshed and the new house pour costs more. A food menu changes and the popular dish is now the one with prawns in it.

Every one of those is a normal commercial decision. Together they move your margin, and the headline sales figure will not mention it.

Popularity and contribution are different questions

The product at the top of your sales report is there because customers like it, because it is well placed on the menu, or because staff recommend it. None of those things makes it your most profitable line.

A product selling a tenth as often can contribute more, and it usually sits somewhere nobody looks. The sales ranking answers "what is popular". It does not answer "what is paying for the building".

It applies harder in the kitchen

Food mix moves faster than drink mix, because a menu change can shift it overnight. A dish can be the most ordered thing you sell and among the least rewarding, and knowing that does not mean taking it off — it is often what brings people in. It means pricing it deliberately, sizing the portion deliberately, and putting something better next to it on the page.

The question worth asking

Not "how much did we sell". Everybody knows that number by Monday. The one that explains the result is what did we sell, and what did that mean — and it only becomes visible when the stock movement is read product by product rather than as a single figure at the bottom.

If your GP has moved and purchasing has not, ask for the mix. It is the most common explanation and the least often looked at.

Hospitality Counts.