What’s the average pour cost for a Moscow Mule?
Here at BevSpot, we love data. Especially the kind that reveals bar and restaurant industry insights. In this case, we’re looking at trends related to the profitability of some of our country’s most popular cocktails.
Our previous analyses of bar profitability data looked at the industry’s overall profitability metrics. We found that the average pour cost, the preferred measure of efficiency for beverage programs, is around 15% for spirits and cocktails. This means that before paying wages and rent, the median BevSpot bar is getting an 85% gross profit margin on their Moscow Mule.
Actually, that’s a lie. The 15% aggregate pour cost measures general profitability for individual establishments, but it represents an average of all the various drinks being sold by those bars. Costs and pricing can vary widely between drinks, especially cocktails—the profit margin on a bar’s Negroni recipe almost certainly won’t be the same as that of an Old Fashioned.
Knowing the costs and profit margins of various recipes is critical for designing and pricing a successful drink menu. In this and a few upcoming articles, we’ll be crunching these numbers for a range of common cocktails, and we’ve turned it into a complete cocktail profitability report. To make comparing between drinks easy, we broke down these recipes based on the liquors they contain.
To find the profit margins that BevSpot users are pricing into their menus, we compared their drinks’ list prices to their unit costs before adjustments for spillage and comped drinks. We also estimated the basic cost of each recipe by comparing users’ unit costs after those adjustments. Doing this allows cleaner comparisons between each cocktail on two metrics: typical profit margins, and typical unit pour costs.
We’ve looked at sales data from nine metro areas across the United States to see which popular cocktails are the most and least profitable for bars. Here’s what we found for six vodka-based classics.
Keep in mind that pour cost is equal to your product usage divided by your sales, or one minus your gross profit margin (we’ve provided a handy explanation for calculating pour costs). A 15% pour cost means that 15% of a drink’s price goes to paying for the drink itself; the other 85% goes to employee wages, rent and other operating expenses. A higher pour cost makes a drink relatively more expensive for the bar, while a lower pour cost makes a drink relatively more profitable.
Of the six cocktails covered here, the Vesper is the most costly for your bartender to serve; the Moscow Mule the most profitable. Since four out of six of these drinks have pour costs of below 15%, it looks like there are plenty of vodka cocktails bar managers can serve while improving their business’ bottom line.
It’s also worth keeping in mind that pour cost is a ratio. If a bar is pricing all of its drinks to have similar profit margins, drinks that are more costly to make would be more expensive. The data shows that this isn’t the case. While the Bloody Mary and Moscow Mule have similar product costs, one tends to be sold at a much higher price point. For the bar, both cost and price are indispensable metrics; pour cost becomes useful because it uses both measures.
While the Vesper is mostly gin by volume, we’ve included it in this list for ease of comparison with other cocktails containing vodka. You can expect to see it again in an upcoming list of gin-based cocktails. (Subscribe to the blog to make sure you don't miss it!)
This recipe is over 90% gin and vodka by volume, so the quality of the liquor used is noticeable. This is especially true for customers with discerning taste buds. Even with higher pricing, cocktails with more liquor by volume often have higher pour costs, and this is no exception.
As an aside, this drink first appeared in 1953’s "Casino Royale," the first of Ian Fleming’s James Bond novels (and the film adaptation starring Daniel Craig). Like Bond, Fleming was a prolific drinker with a taste for good gin, and it shows.
At around a 15% pour cost, the White Russian—the drink in part popularized by "The Big Lebowski"—is almost exactly “middle of the road” when it comes to spirit and cocktail profitability and even price point.
Like the Vesper, the Long Island Iced Tea doesn’t fit neatly into this list because it contains more than one liquor type. Still, it’s a perfect drink for summer, when the data shows vodka, rum and tequila consumption spike. If you’re building a vodka and tequila-dominated cocktail menu for warm weather, it’s worth considering this drink’s relatively low pour cost—though, with eight or more possible ingredients, you might want to consider the associated labor costs.
The sweeter, fruity flavors of the juices and Cointreau in this drink ensure that it goes down easily, even if the bartender isn’t using top shelf vodka. So, while the Cosmo isn’t as cheap to produce as other juice-dependent recipes, it allows the manager to find a more reasonable trade-off between liquor quality and price.
This cocktail sees wide variation in pour cost because its contents vary so widely; while the vodka and tomato juice are a constant, our measures of the typical Bloody Mary price and unit cost are representative of some kind of middle ground in how Bevspot bars build theirs.
Though recipes for this drink can be time-consuming to complete (a factor that bars may be using to justify higher pricing independent of product cost), this drink’s lower liquor content relative to other cocktails results in a lower pour cost overall. This is especially true if the other flavors overpower thriftiness in the bar’s choice of vodka.
With less than 30% liquor by volume and a reputation that Esquire has called “silly,” the Moscow Mule gives bars plenty of room to find profits without really skimping on quality. The ginger beer overpowers much of the variation in flavor between choices of vodka brand. The drink is profitable and easy to make—if you serve it at your bar, put this one at or near the top of the menu.
Sign up to the blog to receive the full cocktail profitability report, which will cover pour cost data for 28 of the nation's most popular cocktails in each primary liquor category, so you can better price drinks for your beverage program.
The estimates in this report are based on data from bars and restaurants in nine metropolitan areas across the continental United States. Product cost and price estimates represent averages of typical drink costs and pricing in these metro areas.