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Does happy hour actually make money?
A discount pays only if it brings in enough extra drinks to cover the margin you gave away. Most do not.
Skip the reading. The tool does this maths for you, free, as you type.
Check your happy hourCutting a $9 drink to $6 gives away $3 of margin on every drink you would have sold anyway. The extra drinks the discount brings in have to earn that back. The break-even uplift is usually higher than owners expect, and food is what saves it.
The formula
Margin per drink = price − pour cost, at each price. Profit per hour = margin × drinks + food profit × drinks × attach rate. Compare happy hour with a normal hour. Uplift needed to break even = regular margin ÷ happy hour margin − 1.
What a good number looks like
It pays. Keep it to the hours that were dead anyway.
Close. Push food: the attach rate is what tips it.
The discount costs more than it brings in. Shrink it or make it food-only.
What to do about it
- Discount the drinks with the lowest pour cost, not the whole menu.
- Never price a happy hour drink under its pour cost plus a dollar.
- Measure the real uplift from the till for two weeks before deciding.
Now do it with your numbers.
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Check your happy hour