Brewery Inventory Software Guide [+ 8 Best Practices for 2025]

While crafting exceptional brews may be your passion, managing the inventory that powers your production is essential for running a successful business. From hops and malt to packaging and kegs, staying on top of your stock is crucial for maintaining consistency, controlling costs, and keeping your customers happy.

The good news is that breweries have incredible gross profit margin potential, often ranging from 74% to 92%. However, to achieve this level of profitability, it’s critical that you have the right tools.

That’s where brewery inventory software comes in. By automating essential processes like tracking, ordering, and cost analysis, breweries of all sizes can save time, reduce waste, and boost profitability.

In this guide, we’ll explore what brewery inventory software is, why inventory management is vital for your brewery’s success, and the best practices to optimize your operations. Whether you're looking to streamline your workflow or scale your business, this article has the insights you need to thrive.

Key takeaways

• Brewery inventory software provides real-time updates on stock levels, ensuring you never run out of critical brewing materials like hops, malt, and yeast.

• By tracking your cost of goods sold (COGS), inventory software can help you reduce waste, optimize pricing, and maintain healthy profit margins.

• Automating processes like reordering and invoice tracking minimizes spoilage, overstocking, and manual errors, leading to smoother operations.

• Forecasting tools ensure you always have your best-selling brews in stock, helping you meet customer expectations.

• Toast’s POS with built-in inventory management makes it easy to integrate inventory tracking, ordering, cost analysis, and much more in one simple-to-use platform.

What is brewery inventory software?

Brewery inventory software is a digital tool that simplifies how breweries track, manage, and replenish their stock. By automating processes like ordering ingredients and monitoring usage, you can eliminate the inefficiencies of manual spreadsheets and ensure smooth production.

Some of the benefits of integrating this technology into your operations include:

• Tracking and monitoring: Stay on top of your inventory with real-time updates on critical brewing materials, including hops, malt, yeast, and packaging supplies.

• Ordering and forecasting: Use past usage trends and data to automate reorder alerts so you never face unexpected ingredient shortages. This predictive capability helps you avoid production delays and stay on schedule.

• Cost control and optimization: Track ingredient expenses and recipe formulations to provide a clear picture of your cost of goods sold (COGS). With this data, you can implement profitable pricing strategies, reduce waste, and avoid overstocking.

Why is inventory management important for breweries?

Inventory management is more than just tracking supplies—it’s a cornerstone of your brewery’s financial and operational success. Here’s why it’s essential:

• Financial impact: Effective inventory management ensures tighter control over your COGS, reduces unnecessary expenses, and prevents cash from being tied up in excessive stock. This balanced approach keeps your brewery operations profitable and efficient.

  • Example: Netstock reports that reducing understocking and overstocking can decrease inventory costs by as much as 10%.

• Waste reduction: Preventing spoilage and overproduction protects your margins. Inventory software helps align stock with production needs, reducing waste and improving operational efficiency.

  • According to the Brewer’s Association (BA), there are four primary sources of waste at breweries: brewing waste, packaging waste, waste generated from food service, and waste generated by events.

• Meeting customer demand: Keeping your most popular brews in stock is crucial for maintaining customer satisfaction and a competitive edge. Inventory tools help forecast demand, so you’re always prepared without overcommitting resources.

Additionally, effective inventory management is vital for providing a consistent product to your customers. Jon Humerick, COO of Solace Brewing, said in a BarTrack Live webinar event:

“Consistency builds trust with your customers, creates a positive reputation for the brand, and ultimately, enhances your revenue… Implementing best practices and educating your staff involves ensuring they know the proper pour technique, serving sizes, inputting the sale, knowledgeability about the beverages, and accurately tracking inventory. Finally, assessing actual vs. theoretical metrics of success will show whether or not true consistency has been met.”

Overall, by efficiently managing your brewery’s inventory, you can minimize risks, control costs, and ensure consistent delivery of quality products to your customers.

Key terms in brewery inventory management

Understanding the terminology of inventory management is crucial if you’re a brewery owner looking to streamline your processes. Some of the essential concepts you should know are

• Cost of goods sold (COGS): Calculating COGS involves summing the cost of ingredients used in brewing your products. This metric helps you set menu prices and determines your gross profit margins.

• Par levels: Par levels are the minimum stock quantities that your brewery should always have on hand to avoid stockouts while preventing overordering and waste.

• Units of measurement (UOM) & unit conversion: Standardize measurements for accuracy and consistency in inventory tracking. Ensure your system easily converts purchased quantities (50 lbs of malt) to recipe quantities (12 oz per batch).

• Recipe costing: Recipes not only determine the quality of your brews, but also impact inventory needs. Accurate recipe costing allows you to adjust your beer pricing strategy and forecast profitability.

• Count sheet & shelf-to-sheet method: A count sheet is used for recording physical inventory counts. The shelf-to-sheet method simplifies inventory counting by aligning items on the shelf with their corresponding records.

• Inventory shrinkage & yield: Shrinkage includes losses from spoilage, spillage, and theft, while yield refers to the usable portion of your ingredients. Regularly monitoring these metrics helps identify inefficiencies and improve profitability.

  • Example: In an interview with Drinks Trade, Bracket Brewing co-owner Mike Meletopoulo, said, “We'll brew a thousand litre batch and for some of the bigger beers we do, we might have 30-35% loss on it, so we're only getting 650 litres out of a thousand litre batch.”

How to leverage brewery inventory software

While manual methods like spreadsheets are familiar and inexpensive, they’re prone to human error and often time-consuming. On the other hand, automated software solutions can save time, increase accuracy, and help optimize your par levels.

Adopting brewery inventory management software can transform how you handle your operations by:

• Automating inventory counts: Software solutions like Toast and xtraCHEF allow you to digitize inventory counts and sync them with your POS system.

• Real-time data analysis: Automate invoice processing to keep ingredient costs updated and generate accurate forecasts. Real-time analysis tools help you adjust pricing quickly and avoid overspending.

By leveraging these tools, your brewery can automate reorders, streamline stock levels, and gain real-time visibility into inventory health. Overall, this translates into better, more informed decision-making.

8 best practices for brewery inventory management

Effective inventory management can lead to significant improvements in efficiency and profitability. To lower your COGS and earn higher profit margins, be sure to consider these brewery inventory management best practices:

1. Maintain a consistent count schedule: Having a regular schedule for inventory counts ensures data accuracy and better cost tracking.

2. Organize storage spaces efficiently: Labeling shelves and organizing ingredients in storage areas streamlines inventory counts.

3. Improve processes for incoming orders: Verifying deliveries upon arrival and noting discrepancies reduces errors and ensures you’re not overpaying.

4. Train your staff: Involving all employees in inventory tracking minimizes mistakes and fosters a culture of accountability.

5. Use First In, First Out (FIFO): Implementing FIFO helps reduce spoilage and ensures you’re always using fresh ingredients.

6. Monitor waste: Record all waste events—whether due to spoilage, overproduction, or process inefficiencies–to inform expectations and adjustments in the future. Understanding the gap between actual and theoretical inventory helps identify waste and theft.

   1. Example: Lord Hobo Brewing Company in Woburn, MA uses intelligent sensors to collect data, conserve water, and reduce inefficiencies in their brewing process.

7. Leverage historical data for forecasting: Using historical sales data to predict future needs helps optimize ordering schedules.

8. Think about Product Mix Management (PMIX): Analyzing which products are selling well allows you to adjust production schedules and ingredient orders to focus on what’s driving revenue.

Transform your business with the best brewery inventory software

Mastering brewery inventory management is essential for maintaining profitability, reducing waste, and keeping your brewing operations running smoothly. By adopting the best practices outlined here and leveraging brewery inventory software, you can save time, cut costs, and ensure your most popular brews are always in stock.

If you're ready to take your brewery to the next level, be sure to check out Toast’s POS system, which features built-in inventory management tools that can simplify your operations. 

From real-time tracking and automated reorder alerts to sales forecasting and cost analysis, Toast offers all the features you need to streamline your workflow and brew the amazing beer your customers love.