Boosting Beverage Profits: Essential Moves for Business Owners
Need to maximise your bar, restaurant, or cafe’s beverage profits. Optimising your drinks menu and service can make a big difference to your bottom line. From designing a great cocktail pricing strategy to leveraging dynamic pricing and creating unique beer events, there are so many ways to enhance your sales and profits.
This collection of expert tips and insights from our recent newsletters covers a wide variety of topics designed to help you increase sales, reduce costs, and improve the bottom line of your drinks program – they’re too good to leave at the bottom of your email inbox!
Beverages should be a fantastic profit driver, but too often, the high margins are reduced by wastage, poor service and stock security problems. Whether it’s wine, beer, spirits or soft drinks, there are many ways to improve profits and total sales volume. Here are the KPIs to track weekly to check stock levels, profit margins, and sales mix. Plus, turnaround tips from a top beverage profit coach – it’s time to make some solid moves! Discover More…
How Do You Decide On Cocktail Prices?
Great advice from Foodie Coaches coach Sam Robertson: 1. Cost them like a food item (ie. around 25% COGs) and break down each element to ensure you hit these targets. 2. If your market is price-sensitive, you can work backward from the price by examining key ingredients and making changes from there. 3. Your suppliers can help you! Your spirit suppliers will jump at the chance to get named brands or volume to get their products into your lists. Don’t be afraid to ask the question. 4. If you’ve got a higher-skilled bar team, they may be able to make some of the syrups/ingredients themselves. This includes pre-batches for cocktails so you know down to the mL what product is being used. No more staff subbing in more expensive booze during service!
Do You Make Money Selling Bottles and Cans?
It’s so easy to accept a ‘free’ fridge from a drinks company, and suddenly, you’re selling more of their low-profit products than your own high-value drinks. They offer easy grab-and-go brands that people crave; we get it. Work out your sales of bottles and cans for a week and the value of what you bought – what was the profit? Compare the much lower bottle margin with what you make on your own iced coffees, fresh juices and cold specials – these should have prime space in your fridge and on the menu. Compete hard with big brands to make them a minor category – they can’t have that much space and offer you so little!
How To Create A Weekend Beer Event
Winter has come, and rather than hibernating, it’s a great time to capitalise on the quieter months. There’s a tiny craft beer business called Scratch in Milton, Qld. Every year, they do the Weekend of Darkness – a craft beer event where, on just 4 Taps, they pump through keg after keg of delicious dark beer. Everything from Dark Lagers, 18% Stouts, and Chocolate Lambics: this weekend is WILD! For the whole weekend, you can barley, sorry, barely get a table as it is full of craft beer aficionados, industry reps, and avid gamers fighting over board games with missing pieces. This all began from a single innovative idea, and saw over 360 attendees on Facebook last year – it even inspired a spin-off event, the ‘Weekend of Tartness’, focusing on sour beers. It’s time to create more of your own events – not every idea will succeed, but you’ll miss 100% if you don’t try. Thanks to coach Sam Robertson
Working With Coffee Suppliers To Boost Sales & Cut Costs
Richard Bettles from Pablo & Rusty’s Coffee Roasters, talked with Ken Burgin on how to deal with a changing and highly competitive landscape. They discussed increased automation in all areas, the new skills that baristas need, how specialised coffee software can give more control and other ways to cut labour costs. In addition, building your retail bean sales is no longer just a nice idea – ‘coffee at home’ can be a great sales opportunity, not a competitor… Watch the Video
What Do You Sell When Customers Don’t Want Coffee?
A surprising number of people don’t drink coffee – as high as 20% in Australia. But why miss out on a sales and extra beverage profits? Good tea can be the solution, but it’s often poorly presented, or the range is uninspiring. The profit margin is much better than coffee – one small bag or a spoonful of leaves added to a nice pot with plenty of boiling water. Have a few ‘real tea’ blends, plus at least 3 herbal varieties, and train staff to offer tea before they ask about coffee in the evening – the results will be a pleasant surprise!
First and Last Items on your Menu and Beverage List Sell More
It’s a small but important part of menu engineering – if you have sections on your menu (appetisers, hot drinks, main courses etc) the customer’s eye is drawn to the items at the start and end of the list. So these should be items with a high dollar profit, even if they’re not the most expensive. Eg the truffle fries cost $2 to make and sell for $9.50, so they go ahead of the $7.50 sweet potato fries that also cost $2 to make. The same applies if servers recite the specials – customers usually remember the first and last thing they said. This applies to your printed menu and items on your ordering app – does anything need to be moved?
Use Dynamic Pricing in your Bar or Restaurant
This is often misunderstood (and sometimes called surge pricing), and you already play with it: happy hour, compulsory set menus at certain times, limiting menu choices when it’s busy, premium prices for certain rooms or tables, and minimum room or event prices in peak seasons. Ordering apps now give you instantly changeable prices, with all sorts of interesting possibilities eg. if the new Mimosa Magic cocktail is an unexpected hit and you quietly raise the price by $2 mid-shift. Play with your pricing and watch all the 1% increases add up to a solid boost in beverage profits!
How to Reduce Your Water Bills – it’s not free!
Rising water costs and growing environmental awareness put hospo in a tight spot. Every drip from a leaky tap or toilet cistern, every melted bucket of ice and even the choice of dishwasher can contribute to a hefty water bill. But you must reduce water use without compromising hygiene or customer comfort – this is not about washing less! From smarter equipment choices to better usage habits, these changes can lead to big savings. The main culprits are dishwashers, excess toilet flushing, and overflowing sinks. Plus, you need to understand how to read your water bill and the different charges—you pay for what goes out and what comes in. We’ve developed a detailed guide to help you stop flushing away money… Discover More.
Handling Customer Resistance to QR Codes
‘It’s all in how it’s presented. We use a hybrid system for indoor diners. We explain that with the app, you can see what you are ordering with your eyes and that it allows us to change the menu when local produce arrives to create a seasonal special. If patrons wish to dine in our garden, they must order online or come and order at the counter. We also give points to customers who use it, so many regulars prefer it. We have menus there for the ones who refuse to use it; it’s easier not to push it with some people.
I get a 99% success rate with online ordering during gigs – I tell customers that I don’t want to interrupt the music and that a cocktail will magically appear every time they hit the order button. People think that technology is taking jobs, but I always explain that it has been a real help to us during staff shortages, and I push that it allows us to change the menu frequently based on seasonality. It saves paper too! Have some fun with it – we will never please everybody; we can only do what’s best for business.’ Thanks to Foodie Coaches member Donna C. for wise advice.
Need to maximise your bar, restaurant, or cafe’s beverage profits. Optimising your drinks menu and service can make a big difference to your bottom line. From designing a great cocktail pricing strategy to leveraging dynamic pricing and creating unique beer events, there are so many ways to enhance your sales and profits.
This collection of expert tips and insights from our recent newsletters covers a wide variety of topics designed to help you increase sales, reduce costs, and improve the bottom line of your drinks program – they’re too good to leave at the bottom of your email inbox!
Subscribe to the Foodie Coaches Hospitality Insider newsletter.
How To Dramatically Improve Your Bar Profits
Beverages should be a fantastic profit driver, but too often, the high margins are reduced by wastage, poor service and stock security problems. Whether it’s wine, beer, spirits or soft drinks, there are many ways to improve profits and total sales volume. Here are the KPIs to track weekly to check stock levels, profit margins, and sales mix. Plus, turnaround tips from a top beverage profit coach – it’s time to make some solid moves! Discover More…
How Do You Decide On Cocktail Prices?
Great advice from Foodie Coaches coach Sam Robertson:
1. Cost them like a food item (ie. around 25% COGs) and break down each element to ensure you hit these targets.
2. If your market is price-sensitive, you can work backward from the price by examining key ingredients and making changes from there.
3. Your suppliers can help you! Your spirit suppliers will jump at the chance to get named brands or volume to get their products into your lists. Don’t be afraid to ask the question.
4. If you’ve got a higher-skilled bar team, they may be able to make some of the syrups/ingredients themselves. This includes pre-batches for cocktails so you know down to the mL what product is being used. No more staff subbing in more expensive booze during service!
Do You Make Money Selling Bottles and Cans?
It’s so easy to accept a ‘free’ fridge from a drinks company, and suddenly, you’re selling more of their low-profit products than your own high-value drinks. They offer easy grab-and-go brands that people crave; we get it. Work out your sales of bottles and cans for a week and the value of what you bought – what was the profit? Compare the much lower bottle margin with what you make on your own iced coffees, fresh juices and cold specials – these should have prime space in your fridge and on the menu. Compete hard with big brands to make them a minor category – they can’t have that much space and offer you so little!
How To Create A Weekend Beer Event
Winter has come, and rather than hibernating, it’s a great time to capitalise on the quieter months. There’s a tiny craft beer business called Scratch in Milton, Qld. Every year, they do the Weekend of Darkness – a craft beer event where, on just 4 Taps, they pump through keg after keg of delicious dark beer. Everything from Dark Lagers, 18% Stouts, and Chocolate Lambics: this weekend is WILD! For the whole weekend, you can barley, sorry, barely get a table as it is full of craft beer aficionados, industry reps, and avid gamers fighting over board games with missing pieces. This all began from a single innovative idea, and saw over 360 attendees on Facebook last year – it even inspired a spin-off event, the ‘Weekend of Tartness’, focusing on sour beers. It’s time to create more of your own events – not every idea will succeed, but you’ll miss 100% if you don’t try. Thanks to coach Sam Robertson
Working With Coffee Suppliers To Boost Sales & Cut Costs
Richard Bettles from Pablo & Rusty’s Coffee Roasters, talked with Ken Burgin on how to deal with a changing and highly competitive landscape. They discussed increased automation in all areas, the new skills that baristas need, how specialised coffee software can give more control and other ways to cut labour costs. In addition, building your retail bean sales is no longer just a nice idea – ‘coffee at home’ can be a great sales opportunity, not a competitor… Watch the Video
What Do You Sell When Customers Don’t Want Coffee?
A surprising number of people don’t drink coffee – as high as 20% in Australia. But why miss out on a sales and extra beverage profits? Good tea can be the solution, but it’s often poorly presented, or the range is uninspiring. The profit margin is much better than coffee – one small bag or a spoonful of leaves added to a nice pot with plenty of boiling water. Have a few ‘real tea’ blends, plus at least 3 herbal varieties, and train staff to offer tea before they ask about coffee in the evening – the results will be a pleasant surprise!
First and Last Items on your Menu and Beverage List Sell More
It’s a small but important part of menu engineering – if you have sections on your menu (appetisers, hot drinks, main courses etc) the customer’s eye is drawn to the items at the start and end of the list. So these should be items with a high dollar profit, even if they’re not the most expensive. Eg the truffle fries cost $2 to make and sell for $9.50, so they go ahead of the $7.50 sweet potato fries that also cost $2 to make. The same applies if servers recite the specials – customers usually remember the first and last thing they said. This applies to your printed menu and items on your ordering app – does anything need to be moved?
Use Dynamic Pricing in your Bar or Restaurant
This is often misunderstood (and sometimes called surge pricing), and you already play with it: happy hour, compulsory set menus at certain times, limiting menu choices when it’s busy, premium prices for certain rooms or tables, and minimum room or event prices in peak seasons. Ordering apps now give you instantly changeable prices, with all sorts of interesting possibilities eg. if the new Mimosa Magic cocktail is an unexpected hit and you quietly raise the price by $2 mid-shift. Play with your pricing and watch all the 1% increases add up to a solid boost in beverage profits!
How to Reduce Your Water Bills – it’s not free!
Rising water costs and growing environmental awareness put hospo in a tight spot. Every drip from a leaky tap or toilet cistern, every melted bucket of ice and even the choice of dishwasher can contribute to a hefty water bill. But you must reduce water use without compromising hygiene or customer comfort – this is not about washing less! From smarter equipment choices to better usage habits, these changes can lead to big savings. The main culprits are dishwashers, excess toilet flushing, and overflowing sinks. Plus, you need to understand how to read your water bill and the different charges—you pay for what goes out and what comes in. We’ve developed a detailed guide to help you stop flushing away money… Discover More.
Handling Customer Resistance to QR Codes
‘It’s all in how it’s presented. We use a hybrid system for indoor diners. We explain that with the app, you can see what you are ordering with your eyes and that it allows us to change the menu when local produce arrives to create a seasonal special. If patrons wish to dine in our garden, they must order online or come and order at the counter. We also give points to customers who use it, so many regulars prefer it. We have menus there for the ones who refuse to use it; it’s easier not to push it with some people.
I get a 99% success rate with online ordering during gigs – I tell customers that I don’t want to interrupt the music and that a cocktail will magically appear every time they hit the order button. People think that technology is taking jobs, but I always explain that it has been a real help to us during staff shortages, and I push that it allows us to change the menu frequently based on seasonality. It saves paper too! Have some fun with it – we will never please everybody; we can only do what’s best for business.’
Thanks to Foodie Coaches member Donna C. for wise advice.
Check the other useful blog posts on the Foodie Coaches website…
Want to get some 1 on 1 help with your business? Talk to one of our coaches