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Mixology For Margins: Menu Engineering To Increase Bar Sales

Bar Showing Menu Engineering (1)

Menu engineering, also known as drink menu optimisation or menu structuring, is the art of maximising the profitability of a menu. Strategic menu planning is all about maximising bar profitability through the subtle promotion of high-profit items and generating clear-cut upselling opportunities. Done well, menu engineering can significantly increase profits.

It’s no secret that the highest profit margins for any bar stem from popular cocktails. Therefore, as far as pricing strategies for bars go, menu engineering is an efficient way to wring out as much value from your menu as possible – turning your most popular drinks into the most profitable and vice versa. Keep reading for our top tips on using mixology for margins.

The Potential For Increased Profit Margins Through Effective Menu Planning

As bar owners, managers, and mixologists know all too well, menu engineering can be a powerful tool for increasing profitability. But what exactly is menu engineering? Essentially, menu engineering is the practice of analysing a restaurant or bar's menu items to determine which are the most profitable. 

By studying the sales patterns of different items, menu engineers can pinpoint exactly which drinks generate the highest profits and recommend any necessary changes that will maximise bar profitability.

Unveiling Menu Engineering Techniques

One of the most effective menu engineering techniques is to focus on drinks that customers are willing to pay a premium for, such as premium and super-premium spirits. By incorporating customer preferences, and customer price sensitivity, bar owners and mixologists can create drinks that stand out from the crowd. Unique or limited-time-only drinks also have the ability to capture customers' attention and generate more revenue.

How Can I Effectively Analyse My Current Drinks Menu To Identify Opportunities For Improving Profitability?

A great way to start analysing your drinks menu is to look at the items that are selling well and those that aren't. Just as importantly, try to identify the reasons why some drinks are selling better than others, and then make adjustments accordingly. 

It can also be useful to compare the prices of similar drinks at competitor venues because this can give you a better understanding of how consumers perceive value for money. Bar, pub and restaurant owners should also pay close attention to customer feedback, as this can be priceless for determining which drinks are popular. 

What Are Some Key Strategies For Pricing Drinks To Maximise Profits Without Alienating Customers?

When it comes to pricing drinks, bar owners should take into account the cost of ingredients, labour costs, overhead expenses, and the target profit margin. It’s also important to consider customer price sensitivity when pricing drinks because customers are more likely to pay a premium for quality and unique drinks. Keeping an eye on your competitors' prices will also ensure you’re not pricing your drinks too low or too high. 

Which Cocktails Tend To Have Higher Profit Margins?

Seasonal and speciality cocktails are an excellent way to attract customers and boost profits. This can be an effective way to capture the attention of customers and boost sales in the process. Speciality cocktails offer an opportunity for bars to stand out from their competitors and generate higher profits. By using unique ingredients and presentation techniques, you can create drinks that are both memorable and profitable. 

We all know that mixed premium spirits offer some of the best profit margins. The sweet spot is to create cocktails with the lowest possible pour cost, bearing in mind that the industry standard is in the region of 18-24%. With that in mind, there’s a reason that many classic cocktails have stayed the course. Traditional favourites like a Mojito, Margarita, Mule or Old Fashioned all boast very low pour costs, making them high-margin mainstays.

Should I Incorporate Premium Spirits Into My Cocktail Recipes?

Incorporating premium spirits in your cocktail recipes is often a judgement call. However, the current trend for premiumisation points towards an increasing thirst amongst customers for premium products. In other words, if you price in premium spirits accordingly, as part of your drink menu optimisation, many customers will willingly pay a higher price for a higher-quality experience.  

By taking advantage of menu engineering techniques and carefully considering pricing and ingredient options, bar, pub and restaurant owners can maximise profits and improve their bottom line. 

By carefully analysing customer preferences, experimenting with unique ingredients, and utilising cost-effective options, bar owners and mixologists can create drinks that draw in customers and boost profits. With the right strategies in place, bars can leverage menu engineering to boost sales and take their business to the next level. 

If you need support with your drink menu optimisation, we offer a range of services here at Matthew Clark, including bespoke hospitality training and marketing support. Contact us on 01275 891 400 to talk to our experts.


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