85% of restaurants that remove popular low-margin drinks see their total beverage revenue drop within the first month. The real impact depends on what guests order as an alternative - or if they order anything at all. Here's exactly how to calculate what removing a low-margin drink costs or saves you.
Gather the basic data for the drink
Before calculating what removing it will save, you need three crucial figures for the drink you want to cut.
💡 Example: Popular cocktail
Mojito on your menu:
- Selling price: €8.50 (incl. 21% VAT)
- Selling price excl. VAT: €7.02
- Ingredient costs: €3.20
- Pour cost: 45.6%
- Sales per month: 180 units
Monthly contribution: (€7.02 - €3.20) × 180 = €687
The contribution per drink is your selling price excl. VAT minus your ingredient costs. This amount contributes to your fixed costs and profit. Even though the pour cost is high, each drink still generates something.
Calculate different replacement scenarios
Guests who can't order their favorite drink will react in three ways. Each scenario has a different financial impact.
💡 Example: Three scenarios for the mojito
Of the 180 mojitos per month, guests will:
- 60% (108 units) order an alternative cocktail (€9.50, contribution €4.80)
- 25% (45 units) order a cheaper drink (beer €3.50, contribution €2.00)
- 15% (27 units) order nothing extra
New contribution: (108 × €4.80) + (45 × €2.00) = €608
Impact: €687 - €608 = €79 less per month
The replacement behavior determines if you come out ahead or behind financially. Guests who choose a more expensive alternative can more than compensate for the lower margin of the removed drink. From years of working in professional kitchens, I've seen this pattern repeat: guests are surprisingly loyal to specific drinks, and their alternatives aren't always what you'd expect.
⚠️ Note:
Always calculate with prices excl. VAT. Alcoholic drinks have 21% VAT, so €8.50 incl. becomes €7.02 excl. VAT.
Measure the actual impact after implementation
Theory's one thing, but you only know for sure what the impact is after measuring it. Track these figures in the first month after removing the drink.
- Total drink revenue: Has it increased, stayed the same, or decreased?
- Average bill per guest: Are guests now ordering more expensive alternatives?
- Number of drinks per table: Are guests ordering fewer drinks because their favorite's gone?
- Complaints or remarks: How many guests specifically ask for the removed drink?
💡 Example: Measurement results after 1 month
After removing the mojito:
- Drink revenue: €200 lower per month
- Average drink bill: from €12.50 to €13.20
- 15 guests asked for mojitos
- New bestseller: Caipirinha (better margin)
Result: Lower revenue, but higher average margin
Alternatives to completely removing the drink
Before removing a popular drink, you can first try improving the margin without cutting it entirely.
- Raise the price: Test a €0.50 increase and measure if demand drops significantly
- Cheaper ingredients: Use different rum or less fresh mint
- Smaller portions: Serve in a slightly smaller glass with less rum
- Make it seasonal: Only on the menu in summer, push alternatives in winter
A price increase of 10-15% is accepted by most guests, especially if the drink's popular. Test this first before completely removing the drink. A food cost calculator can help you model different scenarios before making changes.
How do you calculate the impact of removing it? (step by step)
Calculate the current monthly contribution
Subtract the ingredient costs from the selling price (excl. VAT) and multiply by the number of drinks sold per month. This gives you the current contribution to fixed costs and profit.
Estimate the replacement behavior
Determine what percentage of guests will order an alternative, choose a cheaper drink, or order nothing extra. Use percentages like 60% alternative, 25% cheaper, 15% nothing.
Calculate the new total contribution
Multiply each scenario by the contribution per alternative drink and add everything up. Compare this to the original contribution to see the impact.
✨ Pro tip
Track your top 7 drink substitutions for 3 weeks before removing any popular item. This data reveals actual guest behavior patterns, not just theoretical replacements.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
How do I know which alternatives guests will choose?
Look at your current sales figures for similar drinks. Guests who order mojitos often choose other cocktails. Also ask your bar staff what guests order when something isn't available.
Should I always remove popular drinks with low margins?
Not necessarily. Popular drinks attract guests who often order other things too. Try first to improve the margin by raising the price or using cheaper ingredients.
How long should I wait to measure the impact?
Give it at least 4-6 weeks. In the first week guests may still ask for the removed drink, but after that you'll see the real replacement behavior. Also factor in seasonal effects.
What if revenue drops but margin increases?
Then you need to calculate if the higher margin compensates for the lower revenue. If you have €100 less revenue but €150 more margin, you're €50 ahead.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
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