How do you calculate pour cost for a beverage program and what target range is typically desirable for a full-service operation?

• A. Pour cost = beverage sales / cost of beverage ingredients × 100; target typically 40-60%.
• B. Pour cost = cost of beverage ingredients used for the period / beverage sales for the same period × 100; target typically 18-24% (common 18-22%).
• C. Pour cost = total beverage sales / number of drinks sold; target 5-10%.
• D. Pour cost = cost of glassware / beverage sales × 100; target 25-30%.

Answer: (B)

Pour cost measures how much of beverage sales goes toward the cost of the drinks’ ingredients, giving you a clear view of cost efficiency for the beverage program. To calculate it, take the cost of beverage ingredients used during the period (the ingredients that actually went into the drinks), divide that by beverage sales for the same period, and multiply by 100. This usage-based cost reflects what it really costs to produce the beverages you sell, rather than just ordering costs or inventory values. For accuracy, you track usage by accounting for beginning inventory, additions (purchases), and ending inventory, plus adjustments for waste or spillage, to arrive at the actual cost of goods used.

The typical target range for a full-service operation is about 18-24%, with a common benchmark around 18-22%. Staying in this range helps ensure pricing covers ingredient costs while leaving room for other expenses and profit. The other ways of calculating—such as using sales divided by cost, or using the cost of non-ingredient items like glassware, or measuring per-drink sales—do not reflect the true proportion of ingredient cost to sales, and would give misleading numbers or targets.