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Segmenting Your Taproom Business

Looking to enhance your taproom's profitability? 

Segment, Track, and Action!

In the craft brewing industry, delivering top-tier customer experiences goes hand-in-hand with the quality of the beer served. However, as competition in the industry continues to heat up, optimizing operational efficiency is a must to keep your business thriving.

For those that have a kitchen, both draft beer and food are two major pillars of your taproom business and the importance of properly segmenting and analyzing these components cannot be overstated. Effective data segmentation can provide you with the insights you need to maximize productivity and profitability.

The Power of Segmentation
Before we dive into the specifics, let's clarify what we mean by "segmentation." It's essentially dividing your business into clearly defined components – in this case, Draft and Food. By doing so, you'll be able to track performance, expenses, and profits more accurately for each segment, and also identify opportunities for improvement.

Tracking Employee Work Hours According to Segmentation
Once you've segmented your business, the next step is to align your employee tracking accordingly. This process entails assigning your staff to the respective segments (Draft or Food), and carefully monitoring their worked hours.
Why is this important? By tracking employee hours per segment, you can gain insights into labor costs for each component of your business. Understanding how your labor costs correspond to your sales will help identify any discrepancies and inefficiencies.
For instance, if you're noticing an increase in the hours worked in the food segment but the food sales remain flat, it might be an indication that your kitchen operations need a review. Similarly, if your beverage segment shows a disproportionate labor cost to sales, it might be time to reassess your bar management strategy.

Sales vs Worked Hours: Reading the Trends
Once you've begun tracking employee hours in tandem with sales, the next step is to analyze this data and uncover trends over time. Ideally, as your business evolves and optimizes, your sales should increase while the number of hours worked stays the same or even decreases.

Here's how you can approach this analysis:

1. Collect and Visualize the Data: The first step in any data analysis is collection. Utilize your point of sale (POS) system and labor tracking tools to collect sales and worked hours data. Then, visualize this data in a way that makes it easy to understand trends. Here’s an example of a dashboard that highlights this data.

2. Identify and Analyze Trends: Once the data is visualized, it's easier to see patterns. Are your sales going up while hours remain the same? That's an indication of improving efficiency. If sales are rising but hours are increasing at a faster rate, it's time to examine your operations and identify areas where efficiency could be improved. We can see here that Bartender Hours have increased faster than Drink Sales ... that's not good, we're become less efficient with our labor.

3. Plan and Implement Improvements: Use the insights gained from your analysis to formulate a strategy for improving efficiency. This could involve training staff, adjusting schedules, introducing automation, or any number of other interventions. In this example, we see that Tue and Wed have our lowest Sales/Hour worked ratio and we should look to adjust schedules accordingly. 

Summing Up
The goal of any business is to grow sales while keeping costs manageable. In the taproom business, understanding the distinct parts of your operation, like Draft and Food, and carefully tracking employee hours in these areas, can be key to understanding where you are now and what you need to do to get where you want to be.

While this might seem like a daunting task, data analytics tools and guides can greatly simplify the process. By leveraging these technologies and expertise, you can gain a more holistic view of your operations and make data-driven decisions that propel your business forward.
So, raise a glass to segmentation and data analytics – they just might be the secret ingredients to your taproom's success!

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