How is the price of a pint calculated?

BeerNut

Bigcheeze wrote: »

The VAT is only ever a cost to the end customer.

Sure. But it's calculated based on the price the customer pays. And the price the customer pays is partly determined by the amount of duty payable on the beer. It looks to me like the VAT is calculated on the gross duty (ie before the rebate), rather than the net.

Shouldn't Revenue be adding 21% to the duty rebate cheques?

Edited to answer my own question: if they'd intended to set up a VAT rebate scheme, they'd most likely have set up a VAT rebate scheme.

Geuze

bog master wrote: »

Just a small correction.

Sell Pint: 3.60
less VAT -.62
less purchase from Diageo -1.46
PROFIT for Publican 1.52

I am no friend of the publicans, but please note that out of this 1.50 per pint gross margin have to be paid a lot of expenses and overheads.

Waste costs
Wages
Energy costs

Etc., etc.

Geuze

Prices I have paid during the last year:

Pub just off Trafalgar square, London = 1.99 stg per pint

Camden, London: 3.60stg for Boon geuze (very good value, I thought)


Brussels city centre

From 2.00 for 25cl = 4.50 per pint

To 2.80 for 25cl = 6.36 per pint

Leuven

As low as 1.50 for 25cl, with free "upgrade" to 33cl = 2.58 per pint

But more usually 1.80 for 25cl, or 4.10 per pint

bog master

Geuze wrote: »

I am no friend of the publicans, but please note that out of this 1.50 per pint gross margin have to be paid a lot of expenses and overheads.

Waste costs
Wages
Energy costs

Etc., etc.

I know only to well and you will find in the past, I have posted and corrected many misconceptions about the pub trade. Am quite happy with prices, service, and cleanliness of my local.

BeerNut

Geuze wrote: »

Brussels city centre

From 2.00 for 25cl = 4.50 per pint

To 2.80 for 25cl = 6.36 per pint

Leuven

As low as 1.50 for 25cl, with free "upgrade" to 33cl = 2.58 per pint

But more usually 1.80 for 25cl, or 4.10 per pint

In fairness, per-pint prices don't really make sense with Belgian beer, unless you're drinking lager. A 33cl glass of Leffe in Dublin, for instance, is going to be the far side of a fiver; likewise a bottle of Duvel, Chimay or the like.

Rabies

bog master wrote: »

I know only to well and you will find in the past, I have posted and corrected many misconceptions about the pub trade. Am quite happy with prices, service, and cleanliness of my local.

exactly.

I live and work in NZ for past few years.
Normal price for a pint, bottle of beer, glass of house wine (150ml) or spirt (30ml) is $8

According to xe.com the exchange rate is 8.00 NZD = 4.45625 EUR

Granted, we don't charge for any mixer here, but our hourly normal staff rate is cheaper than back home, and the average working NZer earns less than and an average working Irish person.

BeerNut

Rabies wrote: »

Granted, we don't charge for any mixer here

If one wants to jump up and down about the prices in Irish pubs, soft drinks should be Target No. 1 and leave the pints aside.

Does anyone reckon the prices charged for soft drinks and mixers is fair? Does anyone have a breakdown of the figures like the above?

Geuze

Some Barcelona prices in 2010

Voll Damm in Jai Ca = 2.10 for 20cl / 25cl??? = 4.77 per pint

Estrella = 1.90 for 20/25cl?? = 4.32 per pint


Another pub, bottles of Estrella
20cl bottle = 1.30
33cl bottle = 1.90 (very good value)

Duvel 3.80, Orval = 410, Karmeliet 395

Geuze

BeerNut wrote: »

If one wants to jump up and down about the prices in Irish pubs, soft drinks should be Target No. 1 and leave the pints aside.

Does anyone reckon the prices charged for soft drinks and mixers is fair?

Agreed.

Also 33cl bottles are bad value compared to supermarket prices.

Rabies

BeerNut wrote: »

If one wants to jump up and down about the prices in Irish pubs, soft drinks should be Target No. 1 and leave the pints aside.

Does anyone reckon the prices charged for soft drinks and mixers is fair? Does anyone have a breakdown of the figures like the above?

I do agree that Irish pubs should not charge for a standard mixer. Should be free. Doesn't cost too much. Do away with the bloody glass bottles and introduce post mix. Or charge an extra few cent if using bottles. It will weed out the people you don'r want in the bar over time.

Bigcheeze

BeerNut wrote: »

Shouldn't Revenue be adding 21% to the duty rebate cheques?

If Revenue rebated VAT to the brewery, all the brewery would do is repay that same VAT to the Revenue in their next VAT return, making the whole VAT process more complicated with no net gain. Lower duty makes the microbreweries' products more competitive, a VAT rebate would just involve more book keeping.

BaZmO*

Geuze wrote: »

Also 33cl bottles are bad value compared to supermarket prices.

That’s a weird one due to the obvious transparency between what the average Joe can get a bottle for in the supermarket/off license and what’s charged in a bar. The problem is that if the bars reduced the price of bottles so much well then nobody would drink pints.

Actually, on the price of bottles in Bars. Do the bars get the beer just as cheap as you could get them yourself? say €1 a bottle. If so, that’d make a phenomenal markup for them if they did, which I assume they do.

irish_goat

BaZmO* wrote: »

Actually, on the price of bottles in Bars. Do the bars get the beer just as cheap as you could get them yourself? say €1 a bottle. If so, that’d make a phenomenal markup for them if they did, which I assume they do.

Pub I work in gets bottles of beer(heineken, bud etc) for about 85c each as far as I remember.

BaZmO*

irish_goat wrote: »

Pub I work in gets bottles of beer(heineken, bud etc) for about 85c each as far as I remember.

That's some markup!

Apart from the VAT, which is paid by the customer, the rest is profit then? Or is there some other duty?


edit

Quick calculation..... (excuse any mistake)

Cost 0.85

Sale Price 4.50

Profit 3.65

less 21% VAT 0.63

= 3.02 net profit

rubadub

BeerNut wrote: »

Does anyone reckon the prices charged for soft drinks and mixers is fair? Does anyone have a breakdown of the figures like the above?

I have not done it like exactly like the previous posts, but have highlighted strange pricing policies before. Its a pet hate of mine the way people equate all "drinks" to being the same, and being blind to the different pricing policies.

€5.20 for a bottle (of heineken), this was around 8pm in a normal pub (the goat), i.e. no niteclub, or late nite pub prices.

€5.20 works out at €8.95 per pint, YES almost nine euro for a pint of run of the mill beer, almost twice the price of a pint of guinness. Last time I got them in tesco they were 83cent a bottle, so over 6 times the price.

A pint of guinness in my local is €4.20, 4.2% 568ml. So that is 23.856ml of pure alcohol. €176 per litre of pure alcohol.

A 200ml coke is €2.80, a vodka €3.85 37.5% 35.5ml, €6.65 in total. So 13.3125ml of pure alcohol. €499.50 per litre of pure alcohol.

2.84 times the price.

rubadub wrote: »

say 568ml in the glass to the brim is 113.6ml of miwadi per pint. They come in 1L bottles so 8.8 dashes per bottle. 1L in tesco is €1.79 so say 20cent per dash. So charging you 5 times the price, or a 80cent surcharge/profit.

This sounds like a very good deal to me, many bottles of beer can be got for under a euro these days yet they are €4.50-5.50 in most pubs I go to, so roughly 5 times the price too, but a hell of a lot more profit per drink. Coffee costs about 15-25cent per cup to make and is usually €2-3 in pubs. A pint of coke in my local costs €8.40.

rubadub wrote: »

I usually get 2L of coke €1.50, it would be €28 for 2L in my local!

I remember being in a pub and wondering why they sold pub crisps, a mate actually thought they had to by law, I was then talking about the bottles of coke and he also thought they had to sell 200ml bottles by law too! or had some legal contract with the vitners or something. A few pubs sell cans, and I have seen some pubs sell 2L bottles of coke to families with kids, or pour from a 2L bottle and charge a reasonable price.

SteeveeDee

My local bar at home in Mayo charges 40c for mixer from a standard 2ltr bottle whatever it may be,granted there's not much of a choice but there you go.
Its an old family run bar,they never really had any small bottled soft drinks as far as I can remember.Basically they just do pints and spirits,mostly whiskey.A pint of Beamish is €2.80 Guinness/Smithwicks €3.00 a glass of powers is €2.85 and Connemara €3.00.This is all i drink there so don't know about any other beers.I'd be happy to pay some more given there were some better beers.Also two other plus' are the free tea and no extra charge for a hot whiskey,always amazes me what some folks charge for a bit of hot water and what not in a pub.
I must ask the barman/owner how his money is split.This is a rural bar by the by.

I must also add that it is one of them pub/shops of old,which maybe why they don't charge for the "bits and pieces" but I honestly think that it just never crossed there mind to do so.

knipex

BaZmO* wrote: »

That's some markup!

Apart from the VAT, which is paid by the customer, the rest is profit then? Or is there some other duty?


edit

Quick calculation..... (excuse any mistake)

Cost 0.85

Sale Price 4.50

Profit 3.65

less 21% VAT 0.63

= 3.02 net profit

Not net profit its Gross margin.

From that the publican has to pay rent, rates, wages, insurance, upkeep and maintenance, heating, glasses, tables chairs etc.

You add up gross margin take away overhead and then your left with net profit.

I know one small company where it costs 40K a month just to open his doors. he has to make a gross margin of 40k a month just to break even.

Prenderb

BaZmO* wrote: »

That's some markup!

Apart from the VAT, which is paid by the customer, the rest is profit then? Or is there some other duty?


edit

Quick calculation..... (excuse any mistake)

Cost 0.85

Sale Price 4.50

Profit 3.65

less 21% VAT 0.63

= 3.02 net profit

It's Gross profit, and all of the publican's costs have to come out of that. Though it still sounds nice!

bog master

irish_goat wrote: »

Pub I work in gets bottles of beer(heineken, bud etc) for about 85c each as far as I remember.

Steady on here lads! Lets talk bottles of Bud here 33 cl. From the cash n carry, which by the way is the only way a publican can buy bottles, cans, and spirits, the Net price ex of VAT is €27.75 for 24 bottles=€1.15, with a deposit charged on bottles, which must be collected and then put into the crate. A small bit of extra labour, but it all adds up. Yes, perhaps the mark up is high, but traditionally the pubs have always charged the least for pints, especially Guinness, and had higher margins on bottled beer, which is a recent phenonmenon. And the same could be said for soft drinks. But the popular bottled beers tend to be availabe in pints, which is better value.

Mixer wise, my local, if you are a regular, you are not charged for Seven-Up, ie for a vodka and seven. If you want Coke or Ginger etc., then you pay for the mixer.

It may be time to change, it may not be right, but thats the way it is now.

BTW, I am not a publican, i do bookkeeping for a few pubs, hence my insight. And again, my experience is with a rural type or lets say, non city or large town pub.

SteeveeDee

knipex wrote: »

Not net profit its Gross margin.

From that the publican has to pay rent, rates, wages, insurance, upkeep and maintenance, heating, glasses, tables chairs etc.

You add up gross margin take away overhead and then your left with net profit.

I know one small company where it costs 40K a month just to open his doors. he has to make a gross margin of 40k a month just to break even.

True,but not all pubs have this to deal with.Many rural pubs have no rent or wages to pay outright or have to replenish furniture regularly or have to hire security etc. They also don't suffer from the destruction of toilets that many city bars tend to,I'd imagine that alone is a fairly pricey problem.

I don't think i would go into the pub trade if its cost me 40k a month to operate, but thats just me.

BaZmO*

knipex wrote: »

Not net profit its Gross margin.

Prenderb wrote: »

It's Gross profit, and all of the publican's costs have to come out of that. Though it still sounds nice!

Sorry, yeah I know it's Gross Profit. I was in a hurry in work. I'm just in the habit of writing net cost after the final figure.

That said, it's still an incredible markup even when you consider the overheads. All businesses have overheads.

Geuze

SteeveeDee wrote: »

My local bar at home in Mayo charges 40c for mixer from a standard 2ltr bottle whatever it may be,granted there's not much of a choice but there you go.
Its an old family run bar,they never really had any small bottled soft drinks as far as I can remember.Basically they just do pints and spirits,mostly whiskey.A pint of Beamish is €2.80 Guinness/Smithwicks €3.00 a glass of powers is €2.85 and Connemara €3.00.

I must also add that it is one of them pub/shops of old.

Off topic, but by the sounds of it, I would love to visit this pub.

I am in Mayo fairly often, near Kiltimagh. Where is this pub??

irish_goat

BeerNut wrote: »

Does anyone reckon the prices charged for soft drinks and mixers is fair? Does anyone have a breakdown of the figures like the above?

55c-60c for a standard bottle of mixer like Coca Cola, 7up etc.

Worztron

BaZmO* wrote: »

That said, it's still an incredible markup even when you consider the overheads. All businesses have overheads.

Yes, I agree totally. The pubs have been ripping people off for years.

Rabies

SteeveeDee wrote: »

True,but not all pubs have this to deal with.Many rural pubs have no rent or wages to pay outright or have to replenish furniture regularly or have to hire security etc. They also don't suffer from the destruction of toilets that many city bars tend to,I'd imagine that alone is a fairly pricey problem.

I don't think i would go into the pub trade if its cost me 40k a month to operate, but thats just me.

My stock and staff costs (including security) alone are $20-25k a week during summer. Throw rent, support office and general over heads on to that and it gets fairly high. Winter it drops a bit, but rent and support office don't.
General maintenance isn't too bad, the odd broken door, table etc

SteeveeDee

It's Costello's pub/shop near Tristia village,I guess bangor would be the closest town.It'd be a fair drive out to it from Kiltimagh especially on roads that go in circles!

Geuze wrote: »

Off topic, but by the sounds of it, I would love to visit this pub.

I am in Mayo fairly often, near Kiltimagh. Where is this pub??

SteeveeDee

Rabies wrote: »

My stock and staff costs (including security) alone are $20-25k a week during summer. Throw rent, support office and general over heads on to that and it gets fairly high. Winter it drops a bit, but rent and support office don't.
General maintenance isn't too bad, the odd broken door, table etc

What kind of bar is it?By that I mean location,size,opening times,do you serve food,staff,live music,etc.etc.

I'm just curious as I am having trouble equating it.

the beer revolu

Rabies wrote: »

My stock and staff costs (including security) alone are $20-25k a week during summer. Throw rent, support office and general over heads on to that and it gets fairly high. Winter it drops a bit, but rent and support office don't.
General maintenance isn't too bad, the odd broken door, table etc

Come on, high stock costs mean high turn over.
You cannot include that as an operating cost.
There's a lot of pubs would love to have huge stock bills.
You'd be complaining a lot more if you didn't have to spend money to replenish stocks.

I think everyone here knows that pubs have overheads and any so called profit on a pint does not go straight into the publicans pocket (and if they didn't about five posters here have helpfully pointed this fact out to us).
What pisses people off is when publicans claim that 'half the price of a pint goes to the government' when it clearly doesn't.
The mark up on mixers clearly upsets a lot of people.
And from my point of view, the general apathy shown by most publicans towards craft and quality beer is a big issue, along with untrained staff and ignorant security in many pubs.
Most other industries lower their prices when sales drop.
Pubs have done the opposite.

rubadub

bog master wrote: »

Steady on here lads! Lets talk bottles of Bud here 33 cl. From the cash n carry, which by the way is the only way a publican can buy bottles, cans, and spirits,

Why would this be the case? I remember asking before if there was anything to stop a publican buying lidl brand beer and selling it and somebody (who seemed to be in the trade) said they could do it but reclaiming the VAT would be more troublesome. Currently you can get a bottle of heineken for 75cent including the VAT, so even if they didn't bother trying to reclaim it they are paying far less than your cash & carry ex-Vat price.

In other threads people have mentioned getting mulitpack beers in pubs, and I have heard stories of publicans going up north. The manager in my local was seen buying up lots of vodka in tesco one day.

Rabies

SteeveeDee wrote: »

What kind of bar is it?By that I mean location,size,opening times,do you serve food,staff,live music,etc.etc.

I'm just curious as I am having trouble equating it.

Open 7 days a week.
Close weekdays between 12am-3am. Weekends by 6:30am.
Legal capacity of 225.
No kitchen. Basic bar snacks.
We are quiet busy 3-4 days/nights a week so thats why spend a lot each week.
But as rightly pointed out our turn over is pretty good too.
We'd prob turn over $10-15k more a week than a bar of similar size. But it takes alot of work, it pays off.

We do take care of our customers though.
Happy hour 7 days a week and for two whole nights a week too Drop our prices by 50% on those nights.

But because of our location we do have a decent rent to pay. So, not too cheap all the way.

No live music. Its a bar. Owner won't give me the extra cash to spend in live music