What Is The Profit Margin On Draft Beer?
The most intriguing factor about draft beer is the fact and the idea that it brings flexibility to your bar. You get a wide selection and rotating handles. And thus you can keep your menu fresh. Also adjust the prices along with the serving sizes. With proper pour and strong pouring techniques, draft beer can be one of the highest margin items on your bar menu with a profit margin as high as 80%. Other than this to make more profit make sure that you do not waste beer at all because wastage can cause loss, and thus you will end up losing some amount of money. To avoid wastage, one should make the best use of equipment such as a fob detector, beer fob, and other things in the bar.
There are several things that one should keep in mind before pricing the draft beer. Let us have a look at a couple of things that should be looked upon. Before pricing the daft or the crafted beer.
- Overhead costs
Draft or the crafted beer has overhead costs than the bottled beer. The cost includes and revolves around equipment and maintenance to spoilage, spoilage, and the wastage of the beer. This beer required more upkeep it which means that it requires more costs for maintenance. Chemicals like nitrogen and carbon dioxide are to be used. And purchased on a regular basis to keep the beer fresh. These things add on extra charges i.e. extra charge overhead per glass will allow you to leverage the higher profit margins by adjusting the prices.
- Different sizes of the keg
Another important thing that should not be overlooked while pricing the beer is the size of the keg. The standard size of the keg is considered to be half-barrel which is about 15.5 gallons. Then, there are several other kegs such as European imports that are typically around 13.2 gallons. It is observed that a domestic keg will run a bar of around $100 and the craft beer kegs cost up to $100-$200. The price that you charge should be how much the keg will cost and the serving size of the beer. And also one should keep in mind that a typical glass of beer is 14.5 oz of liquid and 1.5 oz of foam.
Observing and noting all the calculations, now let us have a look at how we can calculate the price of a draft beer.
Well, there is no rocket science involved in doing the same. And you will not be required with a huge formula for the calculations of the price of the draft beer. Let us have a look at how it is done and can be done easily.
- First and foremost you need to determine the amount of beer in each keg. You can do this by diving the number of ounces in the keg by the serving size.
- Then, you will take the cost of the keg. And divide it by your desired pour to get the retail price of the keg.
- Lastly, we will take the retail price of the keg. Divide it by the number of beers that the keg holds to get the cost per pint.
These are the pointers or the things that one should keep in mind before finalizing the price of the craft beer.
Now you should also understand and know that there are several reasons why you would want to offer a robust section of draft beers.
- Draft beer is unique and is available at bars. You can drink a bottle of beer anywhere but if you are looking for an aromatic, pint of beer. Then you will be required to go to a brewery or a bar near you for the same.
- The number of rounds theory is another aspect. The customers tend to think in terms of how many beers they tend to drink. As opposed to how many ounces of beer they drink. The bottles of beers are served in 12oz, and the portions and beers are usually 16oz. Portions of beer can help you promote the draft beer, and it can increase the check averages.
So if you are looking forward to caterer craft beer. You will be required to get behind the scenes aspects of this service in order to ensure this aspect of your business remains profitable. This is all that you are required to know and learn about the profit margin of the beer. To maintain and add to the growth of profit margin you will have to make sure that there is no wastage of the beer. And for the same one can make use of the several types of equipment such as fob detector, beer fob etc. There are others equipment’s to avoid the spillage of the beer.