Guides · Running the place
Cocktail and menu costing: how to work out GP%
The simple maths behind every drink price, with a free calculator.
Gross profit, or GP, is the number every bar lives or dies by. It's simple, and most new owners get it wrong in one of two ways: they forget VAT, or they price by feel. Here's the method, then use the free calculator to do it for every drink on your menu.
The method
- Cost each ingredient: bottle cost ÷ bottle size × amount used. A £22 bottle of vodka (700ml) with a 50ml pour costs £1.57.
- Add them up for the cost of the drink. Don't forget garnish, ice and the syrup: the small things add 20p to 40p to every cocktail.
- Take VAT off the selling price. An £11 cocktail is £9.17 before VAT. The VAT is never yours.
- GP% = (price before VAT − cost) ÷ price before VAT. If the drink costs £2.62 to make: (9.17 − 2.62) ÷ 9.17 = 71%.
What to aim for
| Drink | Typical UK GP% |
|---|---|
| Cocktails | 70–80% |
| Spirits and mixers | 75–85% |
| Wine by the glass | 65–75% |
| Draught beer | 55–65% |
| Coffee | 80–90% |
| Food | 65–75% |
Those are ranges, not rules. A busy pub pint at 58% can make more money than a cocktail at 78% that nobody orders. But if a drink is below the range, either the price is wrong or the pour is.
The mistakes I made
- Free-pouring. Measure everything. A barman who free-pours 60ml instead of 50ml takes 20% off your spirit GP without anyone noticing.
- Pricing from the competition. The bar down the road might be losing money on that drink. Cost it yourself.
- Forgetting wastage. Fresh juice, cream, the last inch of a bottle that gets knocked over: add 5% to your costs for a realistic number.
- Never re-costing. Supplier prices go up; my menu prices didn't follow. Re-cost the whole list every time a price changes, which the calculator makes a two-minute job.