Pour cost in the UK: formulas, planning ranges and the VAT correction
By Jack Hawkins · Updated
Pour cost is the share of a drink's selling price that went into buying it. A cocktail that costs you £2.50 in ingredients and sells at £10.00 net of VAT has a 25% pour cost: a quarter of every sale was the product, three quarters was labour, rent, and whatever's left. UK operators should compute it on the ex-VAT price, with a clear revenue basis before comparing any formula or benchmark.
The phrase itself is American, which explains most UK confusion about it. British trade talk says "GP" or "gross profit percentage". Pour cost is simply the mirror image: pour cost + gross margin = 100%, always. Once that clicks, the whole topic gets much smaller.
The formula, done the UK way
Three steps, and the first one is where the VAT correction lives.
- Net price = menu price ÷ 1.20 (the standard 20% VAT rate)
- Cost per serve = ingredient cost of one drink, from your invoice prices, not retail
- Pour cost = cost per serve ÷ net price × 100
Worked, for a house gin and tonic: a 70cl bottle at £22.00 trade gives 28 measures of 25ml, so the spirit costs £0.79 a serve. Tonic, lime and ice add about £0.31. That's £1.10 in the glass. Menu price £9.50, net £7.92. Pour cost: 13.9%. Gross margin: 86.1%. A simple serve, and one of the reasons a well-run bar loves the G&T list.
A Negroni, using an illustrative £1.05 ingredient build: at £12.50 including VAT, net revenue is £10.4167 and pour cost is 10.08%. At £10 including VAT, net revenue is £8.3333 and pour cost is 12.60%. The recipe has not changed; the selling price changed its cost share. Use an achievable ingredient cost from your own invoices rather than borrowing this low-cost example as a market quotation.
The VAT correction, once more. Divide that £1.05 by a £10 gross menu price and the answer is 10.5%; divide by its £8.3333 net revenue and it is 12.6%. The shortcut understates pour cost by 2.1 percentage points here. There is no universal six-point correction: the gap is 20% of the gross-price cost ratio when the VAT rate is 20%.
Illustrative UK pour-cost planning ranges
These are illustrative planning bands, not measured national averages. Calculate the actual result from your own invoices, realised prices and mix.
| Category | Pour cost band (ex-VAT) | Same thing as GP |
|---|---|---|
| Spirits and cocktails | 15-30% | 70-85% |
| Draught beer, free trade | 35-45% | 55-65% |
| Draught beer, tied | 50-60% | 40-50% |
| Bottled and canned | 30-40% | 60-70% |
| Wine by the glass | 20-35% | 65-80% |
| Soft drinks, post-mix | 10-20% | 80-90% |
| Illustrative wet-led blend | 35-45% | 55-65% |
Shelf-stable spirits can support an efficient ingredient-cost ratio, but citrus, opened vermouth, dairy, house preparations and garnishes have their own shelf lives. A recipe spreadsheet measures theoretical cost, not spoilage or stock loss. The bar's actual product cost comes from a consistent stock cycle; compare the two at the same product, unit and date grain.
The measures question: use the actual UK serve
For gin, rum, vodka and whisky sold by the glass, the specified system is either 25ml and multiples or 35ml and multiples, with one system used on the premises. The 35ml option is not confined to Scotland. The specified-quantity rule has a cocktail exemption for mixtures of three or more liquids; other spirits are not all subject to that same specified-quantity rule. Cost the actual recipe in millilitres and observe the rules applicable to the serve and location.
Two practical consequences. First, cost every recipe in millilitres, at the legal measure your venue actually serves, and keep the spec sheet in the same folder as the cost sheet. Second, when a premium serve moves to a double (50ml), cost it as a new drink rather than nudging the percentage: both spirit quantity and selling price need to be recalculated.
Theoretical versus actual: the only pour cost that matters
Everything above is theoretical pour cost: what the drink should cost if every measure is exact and nothing is wasted. The real number comes from the stock cycle:
Actual cost of goods = opening stock + purchases − closing stock, divided by net wet sales.
The gap between theoretical and actual is variance, and it is where UK bars find money. In an illustrative comparison, theoretical cost at 18% and actual cost at 24% of the same net sales leave a six-percentage-point gap to reconcile through counts, receipts, recipes and explained depletion. On £250,000 of wet sales a year that's £15,000, before considering any different staffing or operating-cost decisions. A venue can choose a 5% investigation trigger, but the appropriate tolerance depends on counting precision, product and the definition of explained loss; it is not a measured national average.
We've written the full arithmetic, with a worked stock cycle, in the stock variance guide, and the variance calculator does it in your browser with no signup.
Reducing pour cost without touching prices (and when you should)
Ordered by least painful:
- Fix the measures before the menu. Jiggers, measured pours, speed rail set to spec. Compare repeated measured pours with the recipe and calculate the actual saving before assuming a percentage improvement.
- Batch the juice and syrups. Batch only to a realistic yield and safe holding period. Record fruit input, usable juice and discarded volume; a larger batch that spoils may cost more rather than less.
- Reprice the three worst builds, not the menu. Sort cocktails by cost per serve against price, fix the three worst offenders by 50p moves, watch them for a month. Small moves track supplier inflation without announcing a price rise.
- Reformulate the signature. If your house negroni uses a £42 Campari alternative, that's a story or a cost; decide which it is.
- Then prices. If a category's supplier costs have moved more than margins have, a menu move is honest arithmetic, not a betrayal.
And the honest caveat: a low pour cost is not automatically good. A 10% blended pour cost can reflect price, mix or incomplete costing; it does not by itself demonstrate that guests think the venue expensive. Price for contribution pounds at the volume your room can hold, then let pour cost check the work.
Keep theoretical and actual ratios comparable
Use net wet sales for both cost ratios and the same calendar window. Theoretical recipe cost is the sum of item sales multiplied by current recipe cost; actual usage cost is opening stock plus receipts less closing stock, adjusted for transfers and returns. Recorded waste explains part of the difference but remains a real cost to the business. Show the total gap and unexplained gap separately. If the theoretical ratio improves while actual cost worsens, check counts, invoice completeness, recipe versions and waste before changing prices. Avoid comparing a spirits-only recipe target with a beer-heavy whole-bar blend.
FAQ
What is pour cost in a bar? The cost of what's in the glass as a percentage of what the drink sold for (before VAT in the UK). £2.50 in a £10 net drink is a 25% pour cost.
What is a good pour cost for a UK bar in 2026? For the illustrative 55–65% ingredient GP blend used in the margin guide, the matching pour-cost range is 35–45%. A cocktail-heavy venue can choose a different target. Compute the blend from actual category sales and costs rather than transferring a spirits-only target to draught beer.
Is pour cost the same as gross margin? They're mirrors of each other and always sum to 100%. 20% pour cost is 80% gross margin. The UK says GP, the US says pour cost, same money.
How do I calculate pour cost with VAT? Net price first: menu price ÷ 1.20. Then cost per serve ÷ net price × 100. Never divide by the gross menu price, or every number looks too good.
Why is my actual pour cost higher than theoretical? Possible reasons include measurement, receipts, recipe mapping, waste and unrecorded authorised serves. Compare the same period and product units, then separate logged explained depletion from the remaining variance. A gap identifies a reconciliation task; it does not establish its cause.
Method and assumptions
Cost examples and planning bands are illustrative. Specified quantities for gin, rum, vodka and whisky permit either a 25ml or 35ml system on the premises, with the applicable cocktail exemption; the 35ml option is not Scotland-only. Review the rule for the actual serve and jurisdiction. Our methodology page explains the distinction between measurements and planning assumptions.
Last reviewed 19 October 2026. To run your own numbers in £ and millilitres, the cocktail pour cost calculator has the VAT correction built in.