Average bar revenue varies from one establishment to the next, but there's one thing that can boost average bar profit margins - proper management. Bar sales offer a higher profit margin than food sales at restaurants, and there’s little overhead involved in the operation.

If you want to know how to make a bar successful, there are a few ways to increase profit.

average bar revenue

Follow these steps to increase bar revenue:

Step 1: Conduct a Bar Audit

One mistake that a lot of bar owners make is that they never audit their bars. If you want to know how to run a successful bar, it all starts with a plan that is revised over time. Audits have the potential to increase bar profits by 5% to 15%.

The audit should focus on one thing: efficiency. An efficient bar can make $600 per hour in bartender generated sales. But this is optimal output and doesn’t account for:

  • Walking to grab a specialty drink item
  • Waiting for strainers
  • Waiting for a jigger

The audit should look at these physical constraints and eliminate them. Question bartenders to find out which physical equipment they do not have available to them. Every station should be outfitted with all of the tools needed to run an efficient bar.

A few of the tools that you may need are:

Ergonomics should also be considered. Make it as easy as possible to allow for the most drinks to be made or poured per hour. Perhaps a bartender needs to bend down and search for a common item. Remove this wasted time with proper storage and organizational techniques.

After the initial audit plan has been carried out, you’ll want to resurvey your staff a few weeks later and see which additional changes should be made. An audit will provide you with a better overview of how the bar operates and what you can do to boost profits.

how to run a successful bar

Step 2: Incorporate Premium Liquors

Premium liquor is one way to boost average sales, and this is done by increasing the per-sale average. If average customers spend $10 on wine, but you introduce a new wine that averages $12 in sales, it will increase profit margins by 20%.

Bartenders are also going to be more willing to recommend the premium options because a higher bar tab means higher tips.

If you want to increase ticket averages, you have to boost premium liquor sales. Keep a close eye on “hot” items, and include them behind the bar to boost sales. If a celebrity is introducing their own brand of Whiskey, like Conor McGregor did, you can offer his brand and boost sales while promotions are ongoing.

Step 3: Marketing Through Specials of the Day

If you want to introduce new drinks, you need to be able to promote them properly. An issue that a lot of bars have is that they stock their shelves with items that their patrons don’t know is available. And if you do introduce premium options, you’ll find that it may be hard to lure in customers.

Specials of the day can help, and this is one way to increase sales. You may start to introduce different mixes or options, such as:

  • Shooters
  • Float programs
  • Cocktails
  • Super-premium options

Non-alcoholic beverages can also increase sales. These items often fly off the shelves, as more people are going to bars for the social aspect rather than drinking. A patron may opt for a coke or other drink because they have work in the morning.

The introduction of non-alcoholic drinks also entices a person who is ready to leave to order a drink before they go.

average bar profit margin

Step 4: Develop Happy Hour Strategies

Do bars make money? Absolutely. But the largest bars in the world still have their “slow” days. One simple tip to increase sales is to offer strategic happy hour specials. These happy hours will be able to increase profits, but you need to focus on the following age group:

  • 21 – 30

People 30 to 40 can also be included in this group, but it depends on your demographic. This age group is all about saving money, and if a competitor is offering cheaper drinks tonight, they will go the extra mile or two to save a dollar.

Happy hour is one of the oldest bar tricks to make money. It is great on slow days, and it also provides the opportunity to bring in new clients. A lot of establishments are offering:

  • 1 + 1 specials
  • 2 + 1 specials

Some bars will also include nachos or other goodies when an entire pint is purchased. Groups tend to come in during happy hour to simply check out what you have to offer. If the vibe matches these individuals’ expectations, they’ll come back for more business.

If your bar has a restaurant or sells food, you’ll be able to increase sales during “happy hours” just by discounting your drinks slightly.

Step 5: Learn Common Upselling Techniques

If you know how to upsell alcohol, you’ll increase profits overnight. Owners will need to train staff on how to properly upsell items. The goal is to train bartenders and servers to upsell to popular, high-priced items.

Perhaps the staff is trained on the right wines to pair with a particular dish. When a customer is trying to decide on what wine to purchase, the server will be able to recommend mid-priced and higher-priced items. Of course, this strategy must not be too push or it may drive buyers away.

Another option is for servers to recommend drinks even if the customer doesn’t ask. “Would you like to try our rose tonight? It’s a flavorful blend of XYZ and is a common item on tonight’s drink menu.” Setting upsell goals for a staff is also a good option. The key is to always make the customer happy, so if a customer is not interested in wine or another alcoholic drink, make sure that staff does not push them too much.

bar management tips

Step 6: Social Media and Bar Sales

A lot of bar owners are ignoring one of the main avenues of increasing sales: social media. Allow your customers to tell their friends and family about your bar. One tactic is to start befriending customers and posting group photos on your bar’s social media account. The person may see the photo and share it with friends, boosting your exposure in the process.

You should make social media an integral part of your marketing strategy, including:

  • Snapchat to hit the 68% of people on the social media app directly
  • Engage in influencer marketing to promote your bar online
  • Leverage live platforms that allow you to share the party with anyone online
  • Get listed on popular bar apps, including options like TapHunter and Untappd, which a lot of bar lovers already have downloaded on their phones

If your bar offers recurring events every week, such as trivia night, and it proves to be a success, keep up the trend. Trivia night is a popular option near me, and it’s often on an off-beat night where the bar is normally not that busy. But the closer it gets to trivia, the more the bar starts to fill up with regulars trying to get their fix of trivia for the week.

Going digital can help, too. Offer options to reserve seating and leverage social media to get the word out about in-house parties or specials. The more you connect with customers and potential customers on social media, the more sales and profits you’ll bring in.

And don’t forget to offer free Wi-Fi. When you offer free Wi-Fi, you’re enabling customers to share your bar on social media and even leave business-generating reviews.

Bars have a lot of options to increase revenue, and the above steps will help increase sales and boost profits.