how do byob restaurants work

If you own an eatery of any sort, it’s likely that you are constantly looking for new ways to boost your bottom line. While introducing new dishes and launching new marketing campaigns are often smart ways to generate more sales and attract new customers, there are still other ways to bring in more business. You might be able to establish an entirely new income stream by allowing people to consume alcohol on your premises, assuming you don’t already let guests drink in your establishment.

Depending on your location and other factors, enabling your clients to drink alcohol may be prohibitive because of the costs involved with securing a liquor license or permit. Although getting a liquor license or permit can be expensive under some circumstances, you may still be able to allow your guests to drink responsibly at your establishment legally while cashing in at the same time by establishing a BYOB policy.

 

What Is BYOB?

You may have received party or barbecue invitations with the BYOB acronym on them. As you’ve probably figured out over the years, “BYOB” is shorthand for “bring your own bottle.”If a restaurant has a BYOB policy, that indicates that guests are allowed to bring in their own alcoholic beverages to their establishment.

BYOB restaurants often allow guests to bring in their own alcohol, such as beer, wine, sometimes even liquor, to enjoy during a meal. The type of alcohol a BYOB restaurant allows its guests to bring in depends on an array of things, such as local laws and the eatery’s theme, staff experience, and liability insurance.

While “BYOB restaurant” is relatively self-explanatory by now, things aren’t quite as straightforward as they may seem on the surface. That’s because a BYOB establishment can offer different levels of service as it relates to adult beverages.

In a typical BYOB restaurant, the eatery serves only non-alcoholic beverages and food. Patrons bring their own beer, liquor, or wine and pour their own alcoholic drinks. While the restaurant may provide glassware, its employees do not handle guests alcohol at all.

alternatives to the traditional hands-off byob policy

Here are some alternatives to the traditional hands-off BYOB policy:

1. Complete the Drink

The first spin on a traditional BYOB restaurant is an establishment that provides the things a guest may need to create a “complete” alcoholic beverage. In cases where spirits are allowed, this may involve the restaurant offering mixers, shakers, strainers, and garnishes like olives or fruit twists. This type of eatery provides all the things necessary for guests to act like their table’s own bartender.

2. Full-Service Optional

Like the first alternative, this sort of BYOB restaurant provides all the things necessary for guests to enjoy well-composed adult beverages, including ice, containers, and garnishes. This version is different from the first because the restaurant offers the option of its employees serving the alcohol tableside to the patrons who brought in their own. The bottles or cans containing the alcohol are generally left at the table regardless of whether employees are pouring their contents for guests.

3. Full-Service

This type of hybrid BYOB restaurant is quite similar to the one just discussed. The key difference between the two is how the alcohol a guest brings in is presented. In this kind of setup, customers will give their alcohol to a restaurant employee upon arrival. Staffers will then serve the alcohol to the appropriate table as if the alcohol originated from the restaurant’s own supply.

4. Corkage Fee

The fourth hybrid BYOB eatery can be any one of the three mentioned above. How this policy is different from the others relates to its fees. This type of eatery adds a “corkage fee” to the bill of diners who bring in their own beer, wine, or spirits. A corkage fee is simply what a person must pay to enjoy the privilege of drinking alcohol at the restaurant. Establishments usually assess corkage fees on a per bottle basis.

How Is BYOB Beneficial to Restaurants?

how byob is beneficial to restaurants

Having a BYOB status can be beneficial for restaurants in some meaningful ways. Arguably the most significant benefit of running a BYOB restaurant is that it can save you a significant amount of money. Depending on the location of your eatery, liquor licenses or permits may have six-figure price tags, which put them out of the reach of many restauranteurs. By going the BYOB route, you may be able to keep that money in the bank or invest it in other aspects of your business, such as upgrading your kitchen equipment or refurbishing your dining room.

In addition to saving you money up front, BYOB can benefit your establishment in the following ways:

1. Enables Guests to Connect With Your Restaurant

As a general rule, successful restaurants are eateries that connect with their customers in some way. If you’ve ever seen an episode of “Cheers,” then you know how powerful the connection between an establishment and its customers can be. Serving alcohol or allowing your guests to serve themselves on a BYOB basis lets your restaurant connect with guests on another level.

2. Provides Chances to Make Specific Recommendations

BYOB restaurants can make specific recommendations to guests based on the food they order or the type of alcohol they bring into those establishments. If people usually contact your establishment to make reservations, your staff can ask your guests making reservations about the alcohol they plan to bring and make a note of it on the reservation so servers can make the appropriate recommendations when viewing their customers profile on their guest management system. Alternatively, your reservationist can provide suggestions about the alcohol that will pair best with the specials that will be served on the night a customer will dine at your restaurant when the person reserves a table.

3. Offers a Chance to Distinguish Your Business From Competitors

If all your competitors offer bar service, your BYOB status is something you can use to distinguish your eatery from the competition. Even if your menu is similar to what a competitor serves, dining at a BYOB establishment is a different experience than eating at a restaurant that has a full-service bar. And it’s an experience that many people seek out in locations across the country.

4. Allows You to Create Classic and Signature Mixers

Similar to restaurants that have bar service, BYOB eateries can offer both classic and signature mixers for people who enjoy drinks made with liquor during their meal. If a patron is going to drink some rye, you can provide bitters so the individual can mix an old fashioned. For guests who enjoy other kinds of spirits, consider making mixers that the diners can’t get elsewhere and that will pair perfectly with the food you serve.

5. Breeds Culinary Creativity

Since BYOB Restaurants don’t enjoy the margins typically associated with traditional alcohol service, many BYOB restaurants have to figure out different ways to make up for the money other establishments earn from their sale of alcohol. One way to do this is by serving creative fare that your competitors don’t offer. Whether you want to have a rotating menu that shows off the best seasonal ingredients your area has to offer, or a menu that’s inspired by a specific type of cuisine, being a BYOB restauranteur allows you to be creative with the food you serve.

6. Makes the Cost of Eating out More Manageable

According to the United States Bureau of Labor Statistics (BLS), a typical American household spends $3,365 on food away from home every year. The BLS also reports that Americans spend approximately 1 percent of their gross income to purchase alcohol. That translates into an annual expenditure of about $565 per year.

When consumers have no choice but to order an adult beverage from a restaurant, going out to eat can be cost prohibitive for some diners. Help your guests’ dollars go further by allowing them to bring their own bottle of wine. A BYOB policy can make dining at your restaurant more affordable for a more extensive base of hungry consumers, including people who might not dine at your establishment otherwise.

7. Lowers Inventory Costs

Just as allowing people to bring their own alcohol makes the cost of eating out easier for many people, it can also help you keep your inventory costs in line. When you have a bar—limited or full-service—it requires you to carry an inventory of alcohol, which can tie up valuable cash until it sells. If your restaurant is BYOB, you’ll be able to invest that money in other areas of your business or keep it in the bank.

8. Creates the Opportunity for an Additional Revenue Stream

If you run a BYOB establishment and you’re not already charging a corkage fee, you may want to implement one to establish a new revenue stream. Some corkage fees are just a few dollars while others might be several hundred dollars per bottle. The key is to implement a corkage fee your customers will be able and willing to pay.

 

Things to Consider Before Implementing a BYOB Policy

If you’re thinking about implementing a BYOB policy, you should consider a few things beforehand. The first thing you need to figure out is whether it’s even possible to establish a BYOB restaurant in your area. The rules that govern alcohol service vary from one state to another and between locales. Some states will require an eatery to have a license to sell and serve alcohol on its premises while others might make it mandatory to have a license or permit that allows guests to consume alcohol on site.

figure out laws for byob

It is essential for you to figure out the laws that are relevant to your establishment and secure any licenses or permits you must have to operate legally. Once you have your license or permit, you’ll then need to determine the type of BYOB eatery you want to have. Will you allow your guests to bring in wine exclusively, or will you permit them to bring in liquor as well? Is your restaurant going to be 100 percent BYOB, or will you sell alcoholic drinks too?

After you determine the type of BYOB eatery you’re going to run, you need to give your restaurant’s insurance considerable thought. If you’re not going to sell alcohol of your own, you might not need the same kind of coverage as a restaurant that has a full-service bar, but you will still need liquor liability insurance. In general, strictly BYOB restaurants are considered social hosts rather than licensed servers.

While social hosts aren’t held potentially liable for as many things as licensed servers can be, they still need the appropriate type and level of liquor liability insurance. Find a knowledgeable insurance agent who is familiar with the insurance requirements of BYOB restaurants and make sure your coverage is in force before you implement a formal BYOB policy.

 

How CAKE’s Products Can Help Support BYOB Policies

CAKE supports BYOB restaurants

If you’re a BYOB operator, you might be trying to figure out a way to have your cake and eat it too in terms of having your eatery offer a seamless dining experience using state-of-the-art technology. CAKE makes it possible for BYOB restaurants to have the equipment they need to provide the dining experience their patrons want and expect.

Our Guest Manager System enables restaurants to handle their waitlists, table management, and reservation process better. With this system in place, people will be able to make reservations online with ease. Your guests will be able to secure a place in line virtually as well. This system provides a view of your tables’ statuses in real-time, which can help you turn over tables more efficiently, serve more diners daily, and increase your bottom line.

One of its best features is the capability to store a guest’s visit history in a customer’s profile. When your staff can look over a guests dining history, it greatly enhances their ability to make recommendations and contributes to a pleasant dining experience.

If you’re searching for a way to serve more guests faster and more efficiently, CAKE has you covered, too. CAKE’s OrderPad allows servers to place orders directly from the table ultimately cutting down on customer wait times and order errors. OrderPads are fully integrated with the CAKE Point of Sale System. This integration can keep everyone on the same page, help get customers seated faster and tables turned faster.

Whether you operate a traditional BYOB establishment or a hybrid, one thing is certain—everything is better with CAKE. Learn more about how CAKE’s products and systems can fully support your BYOB restaurant and keep patrons coming back for more now.