Pizza and Beer

🍕🍺 Nothing beats the perfect pairing of pizza and beer! 🍕🍺
But let's not forget about steak, tacos, and burgers. They all go hand in hand with a cold one. Cheers to endless delicious combinations! 🍻

• Pizza and beer are a classic pairing, often preferred over other food and drink combinations.
• Draft beer has a higher profit margin than pizza, boosting restaurant profitability.
• Understanding beverage costs is essential for successful bar management and profitability.
• Beverage cost is calculated by dividing the cost of goods sold by the sale price.
• Example: Lagunitas IPA costs $1.20, sold for $6, resulting in a 20% beverage cost.
• For cocktails, calculate ingredient costs per ounce to determine total drink costs.
• A Moscow Mule costs $1.60 to make, with a 20% beverage cost when sold for $8.
• Managing beverage costs effectively can significantly enhance bar profits and sustainability.

There are few things in this world that pair better than pizza and beer. Yes, some may argue steak and beer, hamburgers and beer, tacos and beer. Damn the list of what goes good with a cold beer is really endless. Good food and oven baked pizza will keep customers coming back. Good domestic or craft beer will help you make a profit.

Profit Margin Draft Beer

The profit margin on draft beer is much higher than on pizza. Overall alcoholic beverage and coffee sales can be so much more profitable than your restaurants food sales. Maybe this one of the reason why their are so many craft breweries outsourcing to food trucks.

Managing a bar successfully requires a deep understanding of beverage costs. High costs can reduce profits. It is important to control these costs to keep the bar open and make it a neighborhood favorite. In this blog post, we will talk about how to calculate beverage costs. We will also share some helpful formulas to boost your bar's profits.

Profit Margin Liquor

Beverage cost refers to the expenses incurred by a bar whenever a drink is poured or made. It is often referred to as pour costs, liquor costs, or costs of goods. To illustrate this concept, let's consider an example. Suppose a bar purchases a 12-ounce bottle of Lagunitas IPA for $1.20. In this case, the cost of goods sold for the bar would be $1.20. If the bar sells this bottle of Lagunitas for $6, we can find the beverage cost. We do this by dividing the cost of goods sold, which is $1.20, by the sale price of $6. This gives us 0.2, or 20%. Therefore, the beverage cost for Lagunitas IPA is 20%.

The formula for calculating beverage cost is simple: it is the cost of goods sold divided by the sale price. However, things get a bit trickier when it comes to determining the cost of drinks like cocktails or wine by the glass. To make cocktails, first calculate the cost per ounce of each ingredient. This includes both spirits and mixers. Then, find the total beverage cost for the drink.

Let's take the example of a Moscow Mule. To find the cost of the vodka, ginger beer, and lime in the drink, you need to know the cost per ounce of each ingredient. Start by considering the cost per container or bottle for each item. A 750 milliliter bottle of vodka costs $15.25. A 12-ounce can of ginger beer costs $0.84. A 16-ounce bottle of lime juice costs $4.18.

To find the cost per ounce, use the formula: bottle cost divided by ounces per bottle. For the vodka, a 750 milliliter bottle contains approximately 25.3 ounces. So, $15.25 divided by 25.3 equals $0.60 per ounce. Similarly, the cost per ounce for ginger beer is $0.07, and for lime juice, it is $0.26.

Next, calculate the volume used for each ingredient in the cocktail. In the case of the Moscow Mule, we use 2 ounces of vodka, 3 ounces of ginger beer, and 0.75 ounces (or 3/4 ounce) of lime juice. This translates to a cost of $1.20 for the vodka, $0.21 for the ginger beer, and $0.19 for the lime juice per cocktail. Adding these totals together, we find that it costs the bar $1.60 to make each Moscow Mule.

If the bar charges customers $8 for a Moscow Mule, the beverage cost for this drink would be 20%. It is important to consider beverage costs when pricing drinks, selecting ingredients, and placing orders with distributors. By keeping costs low, you can generate higher profits for each sale at your bar.

The greater the percentage of your total sales is from alcohol the better it will be to your bottom line.

Focus on getting the economics and concept of your restaurant or pizza shop right. Then, draft beer sales can greatly help your restaurant's success and profits.

In conclusion, understanding and managing beverage costs is crucial for the success of a bar. By calculating beverage costs correctly and using the right formulas, you can manage expenses. This helps increase profits and ensures your business stays strong in the long run.