The Silent Margin Killers Hiding in Your Drinks Menu — and How to Fix Them
Your bar team uses measured pours. You run regular stocktakes. Prices have been “about right” for years. So why do your margins still feel off?
The truth is, most beverage margin loss doesn’t come from massive errors. It comes from a dozen tiny leaks — small, fixable issues that slip under the radar until your GP is down and your costs are creeping up.
Let’s break down the margin killers you’re probably dealing with — and how to stop them before they cut deeper.
1. Prices Have Changed, But Your Menu Hasn't
Supplier prices creep up. Unless you're regularly checking and recalculating costs, you're flying blind. A cocktail that used to cost $3.40 might now cost $4.20. If you're still charging $16, your GP just quietly dropped 5–7%.
Fix: Audit your top 20 drinks quarterly. Recalculate recipe costs using invoice data, and update pricing where needed.
2. Your POS Recipes Don't Match What's Being Served
It’s easy to assume what’s in the POS is what’s being poured. But staff often make small adjustments — an extra splash of mixer, a double lime garnish, a top-up when the glass looks half-full. Individually, these tweaks feel harmless. Across hundreds of serves, they quietly drain your bottom line.
Fix: Watch a few busy services. Compare what’s being served to your POS recipe. Standardise portions and train to consistency — not just compliance. Update your POS to reflect real-world recipes so reporting is accurate.
3. Wastage Isn't Being Tracked Properly
Spilled drinks. Wrong orders. Staff knockoffs. It all happens — but unless it’s logged, it looks like theft or overpouring when stock doesn’t match sales. If you’re losing a bottle of vodka a week and no one’s logging wastage, you’ll never know where the loss is coming from.
Fix: Use a simple wastage log at the bar. Build it into the workflow — not as a blame game, but as a reality check. If you’re seeing patterns (like lots of one particular cocktail being remade), that’s data you can act on.
4. The Best Sellers Aren't the Most Profitable
That cocktail flying off the pass might be your lowest-margin item. Especially if it uses multiple fresh ingredients, high-end spirits, or fiddly garnishes that take time but don’t add real value to the customer. Volume doesn’t always equal value.
Fix: Run a quick menu engineering check: look at your top 10 selling drinks and calculate the actual GP on each. Highlight the most profitable. Consider promoting those over the low-margin ones. Sometimes a $15 drink with a 78% margin is better for the business than a $20 drink at 60%.
5. Manual Stocktakes Are Giving You the Wrong Picture
If your stocktakes are inconsistent, rushed, or done without clear recipes and conversion factors (e.g. how many G&Ts in a bottle), your usage data is skewed. That makes it hard to know where you’re losing money.
Fix: Create a standard process. Always stocktake at the same time of day/week. Use consistent units. Record wastage separately. If possible, move to digital tools that calculate variance automatically — so you’re spending less time counting and more time improving.
The Takeaway
Margins rarely disappear from one big mistake — they vanish one spill, one missed price change, one inconsistent serve at a time. But these are fixable. With the right numbers, small changes make a big difference.
Want the tools to do it?
How Raise The Bar Solves This
- Automated Recipe Costing
Pricing pulled directly from invoices. No manual edits needed.
- Live GP Tracking
See true margins in real-time, even as prices shift.
- Variance Alerts
Spot mismatches between stock and sales instantly.
- Real-World Insights
Data that reflects how your bar actually operates.