In the modern days when restaurants are much more advanced and smarter in getting customers into their restaurants and overall restaurant branding, there are many tricks they use to boost performance and one of them is not including drink prices on the menus.
In this article, I will reveal the smart reason behind why restaurants don’t show drink prices and some additional things you must know in order to fully understand the main question here.
Restaurants don’t include prices on their menus because it will make the customers order more beverages. Restaurants also want them to focus more on the foods which will increase their profits even further and most restaurants aren’t that comfortable showing their profit margins from drinks either.
There are also other reasons which we will talk about shortly. If we want a complete understanding of why do restaurants really do this and what are the in-depth reasons we need to dive into each of the reasons individually. Let’s get started!
It isn’t unusual when you walk into a restaurant and browse the menu and see that everything is priced except alcoholic beverages. This isn’t an accident because when you have chosen a meal the chances are much higher to order an alcoholic beverage to go with it IF the price isn’t shown on the menu.
However, wine prices are nearly always shown or told when ordering one and if you can’t find the price and you would like to know, just ask the servers and they will tell you.
You need to be careful with this as well especially in high-end restaurants because drinks are the item that reaps the most profit and if you don’t ask the price of your drinks in a high-end restaurant, you could pay far more than expected when it’s time for the check.
Focus on food
By not showing the prices on the drinks, the customers will have more focus on the food which will draw the attention from the drinks, therefore more are ordered.
Depending on the area where the restaurant is located, the competition is fierce and you must do something in order to keep the restaurant profitable.
If the area is competitive and the nearby restaurants have way lower prices than you where you just cant descend to, it would be a reasonable choice to not show the prices. This is because for the customers a beverage is a beverage and if you sell yours way higher than the restaurant next door, the customers might choose another restaurant.
Secret profit margins
It’s not a secret that drinks have the best profit margin and many customers would be negatively astonished that the restaurant sells a bottle of beer for $8 for no particular reason. If that’s the case then it may be best to keep the prices hidden.
However, if the restaurant haves too big of a profit marking that is clearly visible for the customer in the check, it may backfire really badly because the best feeling that the customer can have is that the drink costs less than expected, not much more.
If the restaurant isn’t using digital menus, then there is limited space on each page and depending on the menu’s design and item placements, it can get crowded. Therefore the space on the menu may be the reason why prices aren’t shown.
However, if this is the case then I would advise constructing a whole another menu because it needs to be easy to read and organized for the customer.
This is an important aspect to understand as well and it only considers brands and franchises with multiple restaurants in different states where the price ranges are different.
The menu prices might not be shown because if restaurant 1 is located in New York and the other is located on a remote road in Texas, the customers have really different incomes and spending habits that you can’t just ask the same prices in both of these places.
There might also be different liquor tax rates in each of these areas so you just can’t put the same price on both of them.
Last but not least of the reason is that the menu prices may change quite often if there are different tax laws made or some other reasons that would force the restaurant to alter the prices. This can be an unwanted and time-consuming project to change the menu prices both online and on the physical menu boards.
Why is alcohol so expensive in restaurants
Above all the restaurant is a place of business and when you go for drinks to an eatery, you’re not paying solely on the actual drink. The price includes experience, service, facilities, rent, and paychecks. These things considered it is understandable to pay more than the actual cost of the liquid.
However, the profit margins are still high in alcoholic beverages and another reason for that is that they have been made possible with time. People have paid much for beverages and it is a custom now, therefore there is no reason for the restaurants to drop the prices on them.
Do restaurants make more money on food or alcohol
However this may vary a lot for example a successful pizza restaurant with high pizza prices and a valuable restaurant branding may have a much bigger net profit margin than 10-15%, this is quite rare tho but there are places that have made it happen so it really isn’t a 100% either-or answer.
I always enjoy talking about the restaurant business as a whole and all the little things that consider it. There are much to learn about it and what comes to the absence of drink prices on the menu, there is a famous saying about it which goes as follows: ”If you need to know the price, you don’t belong here” which is true more or less and you can make a conclusion of your own about it.
Read also: 21 Ways To Save Money In Restaurant Business