# How much profit do bars make on their alcohol?!

Question: How much profit do bars make on their alcohol?
I was just curious. I mean here downtown you pay 5.25 for a rum and coke and its basically like ALL ice in the glass.

Does anyone have any idea how much a rum and coke might cost to make for them.
keep in mind that they get discounted alcohol and pop.

Does anyone have any idea what the markup is?

## Best Answer - Chosen by Voters

they make a huge amount of profit

5.25 isnt that bad. i mean they are def making a large profit. their sodas on fountain are so cheap for them, that its almost free. it prolly comes out close to 25 cents for a liter of coke on fountain. and then they put in one shot of rum. and a handle of captain is 25 dollars at a regular liquor store. and theres 40 shots in it. and im sure they get their liquor a little cheaper. so i mean, it costs them less than a dollar for your drink. but they have to pay the bartender, rent, all the utilities. liquor license costs. all employess, bar backs. bouncers. waitress. and then if they serve food as well. it all costs something. so thats why they mark up the drinks. some places get ridiculous tho. 5 bux aint bad

Depending on where you are, the markup could be anywhere from 50% to 150%. Coke syrup and carbonated water dispensed from the bar costs less than 25 cents per drink. Plus, I've seen some bars put as little as 2 tablespoons of rum in a glass of rum & coke drink. And then of course, there is the tips they expect from you.

The bottle of rum was probably about \$5 for the bar and it will generally hold about 25oz. (about \$0.20 per oz.). With a soda gun the coke will be around\$0.01 to 0.05 per oz.). Most bars use about 1.5oz. rum and 2-3 oz coke (\$0.30 rum + \$0.15 for coke = \$0.45). It will be more if you use a better rum.

First off, the reason there's so much ice in the glass is because you need less mixer to fill it. The bar isn't trying to rip you off; they're trying to assure that the drink tastes as strong as possible.

I can't tell you how many people order a drink with "less ice" and then complain that their drink is too weak. I try to explain to them that less ice just means more mixer; it certainly doesn't mean more alcohol. The standard shot at a bar is anywhere from 1 1/4 to 2 oz, and ordering the drink with less ice doesn't change that.

Now that's out of the way...

Most bars get their liquor at wholesale, which means they pay between 40 and 60% of what that bottle would cost at your local packie. So, on the surface, that would seem to be a huge profit. However, you have to consider what the bar has to shell out to the city in order to stay in business. In Boston, the cost of obtaining even a basic cordial license [not including liquor] is over half a million dollars. Obtaining a full-scale liquor license can easily run over a million. The bar has to earn back that cost somehow.

You also have to figure in rent, salaries, comps, insurance, etc. It's basically just like running any other business.

So I would say that your basic rum and coke probably cost the bar somewhere between \$1.50 to \$2.50 to make, depending on which kind of rum you order and how generous they are with their pours. The markup really isn't that much more than what you'd see at your local book store or toy store, but their expenses are likely much higher.

You pay a premium for drinking out instead of drinking in. It's much cheaper to stay home and cook, but we still shell out money for the experience of going out. Same thing.

Professional bartender in Boston

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