Menu engineering transforms how you understand your drink sales by revealing which cocktails actually make money versus those that just move volume. Most bar owners unknowingly push low-margin drinks while their most profitable options sit ignored. You'll categorize every drink as Stars, Plow Horses, Puzzles or Dogs.
The 4 categories of menu engineering
Menu engineering splits your drinks using two measurements: popularity (sales frequency) and profitability (earnings per drink). This creates 4 distinct categories:
- Stars: Popular + profitable (promote heavily!)
- Plow Horses: Popular + unprofitable (raise prices)
- Puzzles: Unpopular + profitable (boost visibility)
- Dogs: Unpopular + unprofitable (consider elimination)
Calculate the profitability of your drinks
Each drink needs its pour cost calculated - essentially food cost for beverages. The formula stays the same:
Pour cost % = (Cost of goods / Selling price excl. VAT) × 100
💡 Example pour cost calculation:
You sell a Mojito for €12.10 (incl. 21% VAT):
- Selling price excl. VAT: €12.10 / 1.21 = €10.00
- Ingredients: €2.40 (rum, lime, mint, sugar, soda)
Pour cost: (€2.40 / €10.00) × 100 = 24%
⚠️ Note:
Alcoholic drinks carry 21% VAT, not 9%! Always use the VAT-excluded price for accurate pour cost calculations.
Measure the popularity of your drinks
Popularity comes from sales data. Pull your POS reports from the past 4 weeks and track each drink type:
- Total units sold
- Percentage of overall drink sales
- Ranking from highest to lowest volume
Any drink performing above average counts as 'popular.' So if you stock 20 different drinks, the top 10 sellers are popular. The bottom 10 aren't.
💡 Example popularity:
Total drink sales last month: 800 units
- Beer: 320 units (40%) - Popular
- Wine: 200 units (25%) - Popular
- Mojito: 80 units (10%) - Popular
- Whiskey sour: 20 units (2.5%) - Unpopular
Categorize your drinks
Now combine popularity with profitability. Standard pour cost thresholds:
- Profitable: Pour cost below 25%
- Unprofitable: Pour cost above 25%
💡 Example categorization:
- Star: Mojito - Popular (10% of sales) + 24% pour cost
- Plow Horse: Heineken - Popular (40%) but 28% pour cost
- Puzzle: Old jenever - 18% pour cost but 1% of sales
- Dog: Fancy cocktail - 32% pour cost and 0.5% of sales
Action plans for each category
Stars (popular + profitable):
- Feature prominently on your menu (special placement, highlighting)
- Coach staff to recommend these drinks
- Maintain consistent ingredient inventory
Plow Horses (popular + unprofitable):
- Increase prices (customers will continue ordering)
- Source cheaper suppliers
- Adjust portion sizes for cocktails
Puzzles (unpopular + profitable):
- Relocate to prime menu real estate
- Train bartenders to suggest these options
- Create happy hour specials around them
Dogs (unpopular + unprofitable):
- Remove from menu entirely
- Replace with higher-performing alternatives
- Discontinue ingredient purchasing
A pattern we see repeatedly in restaurant financials shows that bars focusing on their Plow Horses first achieve the fastest profit improvements, since these drinks already have customer demand.
Timing your analysis
Review your drink menu quarterly. Popularity shifts with seasons, trends, and new additions. Profitability fluctuates with supplier price changes.
Using tools like a food cost calculator makes tracking pour costs and drink performance much simpler.
How do you analyze your drink menu? (step by step)
Gather sales and cost data
Get your till data from the last 4 weeks and note per drink type: number sold, selling price and cost of all ingredients. For cocktails add up all ingredients (alcohol, mixers, garnish).
Calculate pour cost and popularity
Calculate the pour cost for each drink type: (cost of goods / selling price excl. 21% VAT) × 100. Measure popularity by looking at which drinks are above average sales numbers.
Categorize and create action plan
Place each drink type in the right category: promote Stars, make Plow Horses more expensive, give Puzzles more attention, consider removing Dogs. Update your menu and train your staff.
✨ Pro tip
Track your top 7 selling drinks over the next 30 days and calculate their exact pour costs. If 5 out of 7 are profitable, you've captured most of your profit potential.
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
What is a good pour cost for cocktails?
Target pour costs between 18-25% for cocktails. Below 20% is excellent territory, while anything above 28% likely loses money.
Should I also analyze beer and wine?
Absolutely! Beer and wine typically run higher pour costs (25-30%) but move high volume. They're usually your Plow Horses with pricing opportunities.
How often should I analyze my drink menu?
Every 3 months works well. Seasonal changes affect popularity (summer drives cocktail sales) and suppliers adjust prices regularly.
Can I always remove Dogs from the menu?
Not necessarily. Some drinks serve completeness (whiskey for whiskey drinkers) despite low sales. Prioritize optimizing your Plow Horses first.
What if I don't have till data per drink type?
Start by manually tracking sales for one week to estimate patterns. Better yet, upgrade to a POS system that tracks individual products automatically.
Should I set different pour cost targets for different drink types?
Yes, beer typically runs 25-30%, wine 28-35%, and cocktails 18-25%. Spirits neat or on rocks should stay under 20% since there's minimal ingredient cost beyond the alcohol.
📚 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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