Picture this: your wine supplier offers a 15% volume discount, but you're still calculating margins with the old purchase price. You're literally leaving money on the table without knowing it. Here's how to correctly process those discounts in your recipes and wine list.
Why correct processing of discounts is crucial
A supplier discount seems straightforward: you pay less, so you earn more. But if you don't adjust your recipes, you won't know how much you actually earn per glass. That makes it impossible to use your prices strategically.
⚠️ Note:
Always calculate with your actual purchase price after discount. Otherwise you underestimate your margin and miss opportunities to price more competitively.
Recognizing different types of discounts
Suppliers offer various discount types that you need to process differently:
- Volume discount: X% when purchasing Y bottles per month
- Seasonal discount: Temporary discount on specific wines
- Loyalty discount: Annual discount for loyal customers
- Cash discount: Discount when paying within a certain period
💡 Example:
You normally buy Sauvignon Blanc for €8.50 per bottle. When purchasing 24 bottles, you get a 15% discount.
- Normal price: €8.50
- Discount 15%: €8.50 × 0.15 = €1.28
- New purchase price: €8.50 - €1.28 = €7.22
You save €1.28 per bottle = €30.72 per case
Calculate new pour cost after discount
Pour cost is for beverages what food cost is for food: the percentage of your selling price that goes to purchases. After a discount, your pour cost drops, giving you more margin to work with.
Pour cost formula:
Pour cost % = (Purchase price per serving / Selling price excl. VAT) × 100
💡 Example calculation:
Sauvignon Blanc, €6.50 per glass (incl. 21% VAT), 5 glasses per bottle:
- Selling price excl. VAT: €6.50 / 1.21 = €5.37
- Old purchase price per glass: €8.50 / 5 = €1.70
- New purchase price per glass: €7.22 / 5 = €1.44
- Old pour cost: (€1.70 / €5.37) × 100 = 31.7%
- New pour cost: (€1.44 / €5.37) × 100 = 26.8%
Your pour cost drops by 4.9 percentage points!
Three strategies with your new margin
From tracking this across dozens of restaurants, I've seen three main approaches to handling discount savings:
- Strategy 1: More profit - Keep your price the same, increase your margin
- Strategy 2: More competitive - Lower your price, maintain your margin
- Strategy 3: Combination - Split the discount between profit and price
💡 Example strategies:
With €0.26 savings per glass you can:
- Strategy 1: Price €6.50, extra profit €0.26/glass
- Strategy 2: Price €6.20, same margin
- Strategy 3: Price €6.35, €0.13 extra profit + €0.15 more affordable
At 100 glasses per month this makes a difference of €26 to €156 per year
Administration and registration
Keep track of your discounts well for your administration and cost price calculations:
- Note the discount conditions (volume, period, products)
- Update your purchase prices in your system as soon as discount becomes active
- Check monthly if you still meet the discount conditions
- Calculate the financial impact per product
⚠️ Note:
Volume discounts often apply per month. If you don't reach the minimum in a slow month, you still pay the regular price. Keep an eye on this.
Digital tools for discount management
Manually tracking discounts and new cost prices is error-prone. A food cost calculator like KitchenNmbrs helps you to:
- Track purchase prices per supplier
- Automatically calculate pour cost after price changes
- See the impact of discounts on your margin
- Calculate different price scenarios
This way you won't miss any discount and you'll always know what each glass actually brings in.
How do you process a supplier discount? (step by step)
Calculate your new purchase price
Subtract the discount percentage from your current purchase price. At 15% discount on €8.50: €8.50 × 0.85 = €7.23. This becomes your new actual purchase price per bottle.
Recalculate your cost price per glass
Divide your new bottle price by the number of glasses per bottle. €7.23 divided by 5 glasses = €1.45 per glass. This is your new cost price for your pour cost calculation.
Determine your new pour cost percentage
Divide your cost price per glass by your selling price excluding VAT and multiply by 100. €1.45 / €5.37 × 100 = 27%. Compare this with your old pour cost to see the difference.
Choose your pricing strategy
Decide whether you pass the discount on to your guests (lower price), keep it as extra margin, or make a combination. Update your wine list and systems with your new prices.
✨ Pro tip
Track your wine discounts in a spreadsheet with expiration dates and volume requirements. Set monthly reminders 48 hours before month-end to place orders if you're close to hitting volume thresholds.
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
Do I have to lower my wine list price if I get a discount?
You don't have to. You can keep the discount as extra margin, lower your price for more sales, or make a combination. It depends on your competitive position and profit targets.
How do I keep track of whether I still meet volume discounts?
Check your purchases per supplier monthly. Note the discount conditions and count how much you've ordered. Many suppliers also send overviews, but verify this yourself.
What if the discount is temporary?
Calculate how long the discount applies and how much you save in total. You can choose to temporarily increase your margin without adjusting your menu price, especially for short-term promotions.
Can I combine different discounts?
That depends on your supplier. Some offer volume and loyalty discounts together, others don't. Read the terms carefully and ask your supplier explicitly.
How often should I update my recipe costs after getting a discount?
Update immediately once the discount becomes active. Don't wait until month-end or your next inventory - those delayed updates mean you're working with wrong numbers for weeks.
What happens to my pour cost targets when I get a discount?
Your actual pour cost will drop, but keep your target the same initially. Use the extra margin strategically rather than just accepting lower standards across your wine program.
Should I negotiate different discount rates for premium vs house wines?
Absolutely. Premium wines often have higher margins for suppliers, giving you more negotiating room. House wines move faster but have tighter margins - structure your requests accordingly.
📚 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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