How to Price Liquor: Markup, Pour Cost and Drink Pricing

To price liquor, divide the bottle cost by the number of pours to get your cost per pour, then divide that by your target pour cost. A $28 bottle of bourbon (750 ml) gives 16 pours of 1.5 oz at $1.75 each. At a 20% pour cost, the drink sells for $8.75. Most bars land between 15% and 20% on spirits.

The formula is the easy part. Bars that miss their liquor cost usually do it by pricing from an old invoice, or by pricing a 1.5 oz recipe and then pouring 1.75 oz.

How Do You Price Liquor for a Bar?

Price liquor in five steps: work out the cost of one pour, choose a target pour cost, divide the first by the second, add mixers, garnish and a waste allowance if it’s a cocktail, then round and check the result against your local market. The formula is drink price = cost per pour ÷ target pour cost (as a decimal, so 20% is 0.20).

Step 1: Work out the cost per pour

Cost per pour = bottle cost ÷ pours per bottle. Use the price on your most recent invoice, after any distributor discount, not the price you remember paying last year.

Pour size is your decision, but write it down and price to it. In the US, 1.5 oz of 40% spirit is one standard drink as defined by the National Institute on Alcohol Abuse and Alcoholism, and BackBar’s liquor cost guide uses 1.5 oz for a neat pour and 2 oz for a rocks pour.

Round down. The partial pour left in the bottle is your spillage buffer, not extra revenue.

Step 2: Choose a target pour cost

Pour cost is the drink’s ingredient cost as a share of its price. For spirits, 15–20% is the normal range; cocktails usually run a little higher, at 20–25%. If you have no history to go on, start at 20%. The benchmarks are in the liquor cost percentage section below.

Step 3: Divide

Cost per pour ÷ target pour cost = price. $1.75 ÷ 0.20 = $8.75.

Step 4: Add the rest of the drink

A shot is done at step 3. A cocktail also needs its mixers, juice, syrups and garnish costed, plus an allowance for waste. That’s covered in how to cost a cocktail.

Step 5: Round and check the market

Round to the nearest quarter, which is what WISK’s cocktail costing method recommends for a clean menu and faster register work. Then compare the result with what comparable bars near you charge. The formula gives you the lowest price that hits your target. The market tells you whether you can charge more.

Liquor Pricing Examples: Well, Call, Premium and Cocktails

The bottle costs below are examples. Swap in your own invoice prices; the math doesn’t change. Shots use 1.5 oz, the rocks pour 2 oz.

The margarita is 2 oz tequila, 0.75 oz orange liqueur ($14 per liter), 0.75 oz lime juice at $0.40 per ounce, agave and a salted rim with a lime wheel. The old fashioned is 2 oz bourbon, syrup, bitters, an orange peel and a premium cherry.

Two rows deserve a second look.

The well drinks come out at prices almost no bar charges. That’s not a flaw in the formula; it’s the reason wells make money. If your market pays $7 for a well vodka soda, charge $7, and your pour cost on that drink is under 10%.

The top-shelf whisky is the opposite problem. At 20% it needs $25, and your guests may not pay that for a single pour. Plenty of operators accept 25% or more on very expensive bottles, and it’s usually the right call: at $20 the single malt still makes $15 of gross profit per pour, against $7 for the call bourbon at its full 20% target.

Should Pour Cost Targets Change by Liquor Tier?

Yes, but don’t follow a tier table blindly. WISK and WebstaurantStore set well spirits at about 30%, call at 25%, premium at 20% and super-premium at 15%, on the logic that guests pay a bigger premium for better bottles. Other guides argue the reverse and give top-shelf brands the higher pour cost so the price stays sellable.

Treat the tiers as a starting point. Price wells and calls on percentage. Price premium and top-shelf bottles on the dollars each pour makes, because that’s what pays the rent.

What Is the Average Markup on Liquor in a Bar?

The average markup on liquor in a bar is 400–500% over cost, according to WISK. That means the drink sells for five to six times what the liquor in it cost, which works out to a pour cost of about 17–20%. BevSpot’s analysis of its customers’ data put the median spirits pour cost at 15%, a markup closer to 570%.

Restaurant liquor markup follows the same math. A restaurant with a full bar prices spirits the same way a bar does; its blended beverage cost just runs higher because it usually sells more wine.

Liquor Markup Calculator: Pour Cost vs. Markup

Markup and pour cost describe the same price from two directions. Markup % = (1 ÷ pour cost) − 1. Use this table to convert between them:

Watch the wording when you compare notes with other operators. “Marked up four times” sometimes means a price of 4x cost (a 300% markup, 25% pour cost) and sometimes means a 400% markup (5x cost, 20% pour cost). The difference is a full dollar on a $5 drink.

What Is a Good Liquor Cost Percentage?

A good liquor cost percentage is 15–20% for spirits and 20–25% for cocktails. A whole bar program, including beer and wine, usually runs 18–24%. BevSpot found the best-performing quarter of bars at 14% or below on spirits, while BackBar puts the industry standard for spirits at 18–20% and says higher-end cocktail programs can run near 30% and still be healthy.

If your liquor cost is above 25% and you don’t run a craft cocktail program, assume something is wrong: stale costs in your recipes, overpouring, or drinks that leave the bar without being rung in. If it’s below 12%, recheck your inventory count before you celebrate. An overstated ending inventory makes liquor cost look better than it is.

Beer, wine and non-alcoholic benchmarks are in the beverage cost percentage guide.

How to Calculate Liquor Cost

Calculate liquor cost for a period with this formula:

Liquor cost % = (beginning inventory + purchases − ending inventory) ÷ liquor sales × 100

Say you start the month with $8,200 of liquor on the shelf, buy $6,400 during the month, and count $7,900 at month end. You used $6,700 of liquor. If liquor sales were $41,000, your liquor cost is 16.3%.

Three habits keep that number honest:

• Count at the same time each period, and weigh or estimate open bottles to the tenth rather than eyeballing “half full.”
• Keep liquor, beer and wine as separate categories in your POS and on your P&L. A blended number hides which one is drifting.
• Record what leaves the bar without a sale: spirits transferred to the kitchen, comps and spills. Otherwise they show up as unexplained cost.

BackBar suggests that purchases ÷ sales works as a rough shortcut over a full year, but a single month is too short for it because inventory swings distort the result.

How to Cost a Cocktail

A cocktail costs the sum of every ingredient at its cost per ounce, plus garnish, plus a waste allowance. Divide that total by your target pour cost to get the price. Build a recipe card for every drink with each ingredient, its cost per ounce from your latest invoice, the amount used, the garnish cost, the waste allowance, the target pour cost and the final menu price.

Here is a Negroni costed from scratch:

When a cocktail mixes tiers, say a premium bourbon with a house vermouth, cost each ingredient at its own price but set the price against the most expensive spirit in the glass. That’s the bottle the guest is paying for, and it sets their price expectation.

How Do You Price Garnish on a Cocktail?

To price a garnish, divide what you paid for the whole item by the number of garnishes you actually get from it, then add that to the drink’s cost before you apply the pour cost formula. A lime that costs $0.30 and gives 8 wheels costs about $0.04 a wheel. Small numbers, but a bar pouring 300 cocktails a night will spend real money on them.

WISK describes two ways to handle garnish: cost each one into its recipe, or add a flat garnish charge to every cocktail. Individual costing is more accurate. A flat rate is faster and fine for a short menu where every drink gets roughly the same garnish. As a sanity check on whatever you choose, a 2021 benchmark sheet from restaurant consultants Radkey Enterprises puts bar consumables at 4–5% of liquor sales.

How to Cost Fresh Juice and Syrups

Juice yield per lime or lemon varies with fruit size, season and the juicer, so published “juice per lime” figures make poor costing inputs. Run a yield test instead: juice a full case or 10 pounds, measure the ounces, and divide the fruit cost by the ounces. That’s your cost per ounce of juice. Repeat it when the season or your supplier changes, because a case of small winter limes can give noticeably less juice than a summer case.

Syrups, cordials and infusions work the same way: batch ingredient cost ÷ ounces produced. House-made versions are usually cheaper than bought ones, but they take prep time, and that labor doesn’t appear in your pour cost.

Why Add a 20% Waste Allowance?

WISK recommends adding about 20% to a drink’s ingredient cost to cover spillage, expired product and breakage. The point is that your recipe cost should sit below your target, because your actual cost will always be higher than the recipe. The $15 Negroni has a recipe cost of 16.5% of its price. After normal loss, you land close to the 20% you aimed for.

Use 20% until you have your own numbers. After three months of comparing what your POS says you sold with what left the shelf, replace it with your measured variance.

Profit Margin on Cocktails and Liquor

The gross profit margin on a drink is 100% minus its pour cost. At a 20% pour cost, 80 cents of every dollar is gross profit before labor, rent and everything else. Spirits served neat or in highballs typically return 80–85%, cocktails 75–80%, beer about 75–80% and wine less, often 60–72%, which is why a bar’s alcohol profit margin depends so heavily on what it sells most of.

Percentage isn’t the whole story. Compare two drinks:

The old fashioned has the “worse” pour cost and makes $3 more every time someone orders it. If guests in your bar will pay for it, a higher-cost drink that earns more dollars is the better drink. That’s the contribution margin argument, and it applies to a cocktail list exactly as it does to food.

What Makes a Cocktail High-Margin?

A cocktail is high-margin when most of its volume comes from cheap ingredients and its price is set by what it’s worth to the guest rather than by its spirit cost. In percentage terms, highballs, spritzes and sours built on well or call spirits usually win. In dollar terms, premium spirit-forward drinks often do. A good list has both.

The levers that raise a cocktail’s margin:

• Volume from inexpensive ingredients such as soda, tonic, ginger beer and sparkling wine.
• Modifiers used in small doses, where a quarter or half ounce changes the flavor but barely moves the cost.
• House-made syrups, cordials and infusions in place of bought products. The Restaurant HQ’s bar menu guide notes these are typically cheaper than pre-made alternatives and harder for competitors to copy.
• A base spirit that is good rather than famous. A signature drink sells on its description, so a call spirit often does the job a premium one would.
• Batching. Prebatched components cut the labor per drink and speed up service, which matters more on a busy Friday than a few cents of ingredient cost.

Which Liqueurs Give Cocktails the Best Margin?

No liqueur is high-margin on its own. A liqueur adds margin when a small pour of 0.25 to 0.75 oz adds flavor guests will pay for while adding little cost. Orange liqueurs, aperitivo bitters, vermouths, coffee liqueurs and herbal liqueurs all fit that pattern at half-ounce doses: a $25 liter of aperitivo bitter costs about $0.37 per half ounce, and even a $40 bottle (750 ml) of elderflower liqueur adds only $0.79.

The catch is waste. Vermouth and other wine-based aperitifs oxidize once opened. Keep them refrigerated, date the bottles, and buy smaller sizes for slow movers, or the margin you designed goes down the drain.

How to Control Liquor Costs

Control liquor costs by measuring every pour, counting inventory weekly, comparing what the POS says you sold with what left the shelf, and updating drink costs every time your distributor’s prices change. Pricing sets your theoretical liquor cost; these habits decide whether you get it.

Measure Every Pour

A quarter-ounce overpour on a 1.5 oz drink is 17% more liquor than you priced. At 200 drinks a night and $1.10 an ounce, that’s $55 a night, close to $20,000 a year for a bar open most nights. Jiggers and measured pour spouts fix it. Bartenders who free-pour well can still learn to hit a spec; most just haven’t been asked to.

Count Inventory Weekly

Count full bottles, and weigh or estimate open ones to the tenth. Weekly counts let you catch a problem in days instead of discovering it on the monthly P&L.

Run a Variance Report

Multiply what the POS says you sold by each recipe to get theoretical usage, then compare it with actual usage from your counts, product by product. Gaps point to overpouring, unrung drinks, waste or theft, and each has a different fix.

Close the Side Doors

Ring every drink before it’s poured. Log comps, spills, remakes and staff drinks. Receive every delivery against the invoice, keep the storeroom locked, and issue new bottles only in exchange for empties.

Recost When Prices Move

Update your spirit costs whenever a distributor price changes, and review the full drink list at least quarterly. A drink priced at 20% in January can be at 24% by autumn if its base spirit went up and nobody noticed.

Liquor Pricing Checklist

• Every spirit has a current cost per pour from the latest invoice
• House pour sizes are written down (neat, rocks, cocktail) and enforced with jiggers
• Target pour cost set for spirits and for cocktails
• Every cocktail has a recipe card including juice, syrups, garnish and waste allowance
• Garnish costed per drink, or a flat garnish charge applied across the menu
• Prices rounded to the quarter and checked against comparable bars
• Premium and top-shelf bottles priced on dollar margin, not just percentage
• Liquor, beer and wine tracked as separate cost categories
• Inventory counted weekly, with a variance report against POS sales
• Drink costs updated whenever a distributor price changes