Section 3: Perpetual Versus Periodic Inventory
Section Goal: In this section, you will learn the importance of using a perpetual inventory system.♦
Perpetual Versus Periodic Inventory
Now that you have your inventory and ordering procedures in place. It is time to go over your inventory process. There are two different ways to monitor inventory, perpetual and periodic. Most hotels only use periodic. We strongly recommend a combination of both. Here are the differences between the two:
Perpetual Inventory – A continuous, ongoing inventory count that is in agreement with stock on hand. The inventory can be easily reconciled after each requisition transaction. Counting inventory perpetually will help catch any discrepancies faster and also help prevent running out of certain items.
Periodic Inventory – A physical count of inventory at specified periods of time. Most bars already employ this type of inventory count. Usually, a full count is done at the end of each month.
All bars should use a combination of both methods. Most hotels only do a monthly or quarterly periodic inventory and then adjust the inventory value. You never want to be surprised by your liquor cost. By doing a perpetual inventory, you will know your liquor cost every day. We have put together a perpetual beverage inventory how-to video as well as some inventory templates that you can download for free.
Perpetual Beverage Inventory How-To Video
Training Video Goal: Successful implementation of perpetual beverage inventory by providing instructions and necessary tools
Training Video Length: Approximately 10 Minutes, Video can be paused and replayed at the viewer’s chosen speed
Training Video Audience: All Food and Beverage Managers or Accounting Associates implementing a perpetual beverage inventory system
This video takes approximately 1 minute to load and will automatically play once loaded. For your convenience, all templates and instructions that are mentioned in the video are available free for download on this page below the video.
Actions to take:
- Review the perpetual inventory video and download the templates
- Install the perpetual inventory system at your hotel
- Review your liquor cost on a daily basis instead of waiting for the end of the month
Your progress so far: 1.Introduction, 2.Understanding Budgeted Cost, 3.Inventory Inaccuracies, 4.Perpetual vs. Periodic Inventory, 5.Poor Pour Practices, 6.Causes of Internal Theft, 7.Common Types of Theft, 8.Self Assessment, 9.Review and Conclusion