Every hospitality operator relies on stock reports to keep track of profit and performance. Variance reports – the difference between what you consumed and what you actually sold.
But what if the numbers you’re relying on aren’t telling the truth?
At Capcon, we see it all the time. Reports that look accurate but are quietly wrong – distorted by missing data, outdated prices, or inconsistent processes. And when that happens, managers make decisions on false information, leading to wasted stock, inaccurate targets, and misleading GP%.
Here’s why your variance reports might be misleading you – and how to fix them.
- You’re Looking at the Numbers, Not the Narrative
The biggest mistake isn’t in the maths – it’s in the mindset. Too many operators look at a variance figure, nod, and move on. But that figure is only useful if you ask why.
Variance is a symptom, not a diagnosis. Without investigating the underlying cause – equipment failure, poor training, portion control, or theft – it will keep reappearing.
The fix:
Turn reports into action. Discuss them with teams. Ask questions. Track corrective measures and check whether they work.
“Variance isn’t just a number on a page,” says Mike Porteous. “It’s a story about your operation. You can’t fix what you don’t understand.”
- The Data Is Out of Sync
Variance reports are only as good as the data behind them. If your deliveries, EPOS sales, and stock counts aren’t synchronised, the results will never line up.
Even small timing differences – a late delivery entry or a missed transfer between bars – can throw off your variance by hundreds of pounds.
Common causes include:
- Deliveries entered after the stocktake
- Missing or delayed sales data from tills
- Transfers between departments not recorded
- Out-of-date product lists or coding errors
The fix:
Get everything speaking the same language. Integrate your audit platform with EPOS and purchasing systems wherever possible.
Tools like Nifty19 help by automating till imports and flagging discrepancies before they distort results. That means your data matches reality, not just paperwork.
“If your data doesn’t line up, your GP% doesn’t mean anything,” says Lee Bowen at Capcon. “Integration is the only way to get a true picture of performance.”
- Your Cost Prices Are Wrong
Variance reports calculate GP% based on cost prices – but if those costs are outdated or inconsistent, your results are misleading.
We often find venues still using supplier prices from months ago, even though costs have since changed. That makes it look like you’re performing better (or worse) than you really are.
The fix:
Update your pricing regularly. Build it into your process – every time you receive a new invoice, refresh the corresponding product cost.
Even better, use software that automatically updates pricing data from suppliers. That way, your GP calculations stay accurate without the admin.
“If you’re not tracking cost price changes, you’re not tracking profit,” says Steven Willey of Capcon. “The margin you think you’re making could already be gone.”
- Sales Are Mis-Coded or Missing
Till coding might sound minor, but it’s one of the most common reasons variance reports fail.
When products are grouped incorrectly – for example, all gins coded as one item – the system can’t accurately match consumption to sales.
That means even if your total sales seem right, the breakdown by product is wrong, hiding overpouring or stock loss.
The fix:
Audit your till setup. Make sure each product sold corresponds to the right stock line.
Regularly review and clean up product codes, especially when menu items change or suppliers are switched.
In Nifty19, auditors can view, code, and reassign till lines quickly, making it easier to maintain accuracy as menus evolve.
- You’re Comparing Apples with Oranges
Not all stock periods are created equal. If you compare a busy bank holiday to a quiet midweek cycle without adjusting for sales volume or product mix, your variance can appear to fluctuate wildly – even when performance hasn’t really changed.
Similarly, comparing GP% across sites without standardising categories (food vs wet, draught vs packaged) gives a skewed picture.
The fix:
Always compare like with like. Normalise your data so comparisons are meaningful – for example, by using GP% by category, or variance per £1,000 of sales.
Capcon’s audit reports provide this breakdown automatically, helping managers see the difference between operational problems and natural seasonal or trading variation.
Bonus Red Flag: You’re Waiting Too Long to Act
Even the most accurate report loses value if it arrives weeks late. By then, the opportunity to correct behaviour or adjust processes has passed.
Real-time systems like Nifty19 produce results on the day of the audit, allowing managers to act immediately. That means faster recovery, less waste, and tighter control.
“Speed matters,” says Nick Gay. “The quicker you can see your results, the quicker you can protect your profit.”
From Illusion to Insight
The problem with inaccurate variance reports isn’t just financial, it’s behavioural.
When teams lose trust in the numbers, they stop engaging with them. Audits become a tick-box exercise, not a management tool.
But when reports are accurate, timely, and easy to understand, they build accountability and confidence at every level. Managers trust the data, staff trust the process, and decisions get better.
That’s why Capcon’s approach to auditing combines human expertise with technology, turning static numbers into live business intelligence.
The Takeaway
Variance reports are one of the most powerful tools in hospitality – but only if they tell the truth.
If your numbers don’t match what’s happening on the floor, it’s time to look deeper:
- Keep your data aligned and up to date
- Audit your pricing and coding regularly
- Use technology to automate and verify
- Act on the story, not just the statistic
Because when your reports are accurate, your decisions are better – and your profits follow.
Capcon delivers independent stock audits and real-time reporting through Nifty19, helping hospitality businesses turn data into insight and insight into profit.
Find out more at nifty19.com or contact the Capcon team at [email protected].
