What The Bartender Won’t Tell You – Profit Margins Edition

Ever wonder why a bottle-o-suds at your favorite watering hole costs 3 or 4 times what you’d fork over at Manuel’s bodega? Well dear readers, I’m going to break it down for your reading pleasure. Hopefully, you’ll still frequent my bar and continue to hand over your cash for wildly overpriced hooch.

A “business,” by definition, is an operation whose primary purpose is to generate revenue and in turn, a steady stream of profit. No profit = No business – period. This is just about the only reason why you see bars and restaurant doors shuttered… they haven’t been able to operate in the black for whatever reason. A huge part of a successful bar is properly pricing your products. There are many factors that go into those decisions including (a) neighboring/competing establishments’ prices (b) the type of clientele you’re trying to attract and image (c) supply/demand (d) availability/desirabilty and of course (e) cost baseline.

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