You can have the best-looking menu on the island and be losing money on every serve. Drink costing is the difference between guessing and knowing. Here is how to do it and what numbers to aim for.
What is drink costing?
Drink costing is the calculation of the exact ingredient cost per serve: every millilitre of spirit, syrup or purée, every piece of fruit, every garnish. You add up the cost of every ingredient in its actual quantity and you get what it costs you to put that glass on the table — before staff, rent and utilities. That number is your baseline for every pricing decision you make.
How to calculate it, step by step
Step 1: Break down the recipe. List every ingredient and its exact quantity in that serve. A cocktail with fruit purée might include 50 ml of spirit, 90 ml of purée, 15 ml of syrup, ice and a garnish. Write it all down.
Step 2: Calculate cost per unit for each ingredient. Divide the bottle price by its volume in ml, then multiply by the quantity in your recipe. Two ODK benchmarks to work from: a 750 ml syrup bottle at a 15 ml dose gives you 50 serves — roughly €0.20 per serve. A 750 ml Fruity Mix purée at a 1:7 dilution ratio gives you approximately 17 serves per bottle.
Step 3: Add wastage. Ice you pour away, fruit that goes off, bar errors. A realistic wastage allowance is 5 to 10% on top of your theoretical cost.
Step 4: Calculate your beverage cost percentage. Total ingredient cost divided by retail price. If a cocktail costs you €1.80 in ingredients and you sell it at €9, your beverage cost is 20%. That is a healthy number.
What are healthy margin targets?
Industry benchmarks for cocktail bars: 18 to 24% beverage cost as a proportion of retail price. Coffee shops run even leaner — a flavoured latte adds €0.20 in syrup cost to a base serve, which justifies a €1 or more price uplift without any guest resistance. If any item on your menu runs above 30% beverage cost, the options are simple: raise the price, rework the recipe or remove it from the menu.
The most expensive mistake: costing once and forgetting it
Ingredient prices change. A cost sheet from January can be significantly wrong by July. When prices drift up and your menu prices stay fixed, your margin erodes quietly and you only notice it at the end of the quarter. Professional menu engineering treats drink costing as a live process, not a one-off spreadsheet you do when you open. Review it every time you reorder.
The ODK Canarias app: automatic costing built in
Our menu design app calculates drink costing automatically for every recipe: cost per serve, margin, recommended retail price and full allergen information compliant with EU Regulation 1169/2011. You choose the drinks; the numbers are done. The menu outputs as paper, PDF and dynamic QR. If you want the full picture across your entire menu, we design it for you — costing included, no obligation.