The margin on soft drinks determines how much you keep per glass after deducting purchase costs. Most hospitality entrepreneurs calculate only the syrup cost, forgetting VAT, CO2 and other expenses. Here's how to calculate your real soft drink margin step by step.
What does a glass of soft drink really cost?
Cola seems cheap - syrup costs pennies. But you're dealing with more expenses than you realize:
- Syrup or concentrate
- CO2 for carbonation
- Water (with own mixing system)
- Ice (energy for ice machine)
- Straw, napkin
- Glass (depreciation and breakage)
? Example: Cola from tap system
Glass of cola (0.25L) sold for €2.75 incl. VAT:
- Syrup: €0.18
- CO2: €0.03
- Ice: €0.02
- Straw/napkin: €0.02
Total purchase costs: €0.25
Processing VAT correctly
Soft drinks in restaurants fall under 9% VAT. For your margin calculation, you always work with the price excluding VAT.
⚠️ Note:
Never calculate with the VAT-inclusive price. Your margin will look higher than it actually is. €2.75 incl. VAT = €2.52 excl. VAT at 9%.
The formula for drink margin
Just like with food, you use a percentage to calculate your margin:
Drink margin % = (Purchase costs / Sales price excl. VAT) × 100
? Example calculation:
Cola for €2.75 incl. VAT with €0.25 purchase costs:
- Sales price excl. VAT: €2.75 ÷ 1.09 = €2.52
- Drink margin: (€0.25 ÷ €2.52) × 100 = 9.9%
You keep 90.1% as margin
Standard margins per drink type
Different drinks carry different margins:
- Soft drink from tap: 8-15% purchase costs
- Soft drink from bottle: 25-35% purchase costs
- Freshly squeezed juice: 20-30% purchase costs
- Coffee/tea: 15-25% purchase costs
- Water (bottle): 20-30% purchase costs
? Comparison: Tap vs Bottle
Cola 0.25L sold for €2.75:
- From tap: €0.25 purchase = 9.9% costs
- From bottle: €0.65 purchase = 25.8% costs
Tap delivers €0.40 more margin per glass
Hidden costs you forget
After managing kitchen operations for nearly a decade, I've seen many entrepreneurs calculate only the syrup cost. But they're missing:
- Equipment: Depreciation of tap system, ice machine
- Maintenance: Cleaning pipes, replacing filters
- Energy: Cooling syrup, ice production
- Breakage: Glasses that break
- Overfilling: Too full glasses by staff
Impact on annual basis
Small differences in drink margin create massive impact:
? Impact calculation:
Restaurant with 50 soft drinks per day:
- 5% difference in margin = €0.13 per glass
- Per day: 50 × €0.13 = €6.50
- Per year: €6.50 × 300 days = €1,950
Almost €2,000 difference per year
How do you calculate the margin on soft drinks? (step by step)
Gather all purchase costs
Add up: syrup/concentrate, CO2, water, ice, straw, napkin and part of the glass costs. Don't forget energy for cooling and ice production either.
Calculate sales price excluding VAT
Divide your menu price by 1.09 to go from including to excluding 9% VAT. €2.75 incl. becomes €2.52 excl. VAT.
Apply the formula
Divide purchase costs by sales price excl. VAT and multiply by 100. At €0.25 purchase on €2.52 sales = 9.9% costs, so 90.1% margin.
✨ Pro tip
Track your drink margin on your 3 highest-volume soft drinks weekly for 4 weeks. These drinks represent 80% of your beverage profit, so getting their margins right maximizes your overall profitability.
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
Should I include VAT in my margin calculation?
What is a good margin on soft drinks?
What costs do I often forget with soft drinks?
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
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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