The Real Cost of Giving Away a Free Drink or Discount

You ever been at a bar or restaurant and thought, “It’s just one free drink, what’s the big deal?” Or maybe you’ve asked for a discount on the bill because you’re a regular and figured, “It’s only a few quid, it won’t hurt them.”

But here’s the thing—it does. Because in hospitality, margins are razor-thin, and what seems like a small gesture can have a much bigger financial impact than you might think.

Why Giving Something Away Isn’t Just a ‘Nice Gesture’

Let’s say a bar gives away a £10 cocktail. That’s not just £10 lost—because the cost of ingredients, staff wages, rent, and overheads still have to be covered.

For most venues, the actual profit on that drink is maybe £2-£3 max. So when that £10 drink is given away, it takes selling another three or four just to break even on that loss.

Now imagine that happening multiple times a night—or across a whole weekend. It adds up fast.

Discounts Aren’t ‘Just a Small Gesture’

You know those “Can I get a little off the bill?” requests or “I’m a regular, surely I get a discount?” moments? They might seem harmless, but for a business that operates on 5-10% net profit on a good day, a £10 discount means they now have to make another £200 in sales just to recover that loss.

For independent venues, those small discounts can stack up into real financial struggles.

When Giving Something Away Makes Sense

Now, don’t get me wrong—there are times when a free drink or discount is absolutely justified:

• If there’s been a mistake. A long wait, a wrong order, or something genuinely not up to standard.

• As a genuine ‘thank you’. Some venues will treat great customers—but it’s their decision, not an expectation.

• For a well-planned promotion. When a venue runs an offer, they’ve already factored in the cost and made it part of their strategy.

But when everyone expects a freebie just because—that’s when it becomes a problem.

The Bigger Picture

The next time you’re about to ask for a free drink or discount, just consider—it might not seem like much, but when it happens all the time, it really does make a difference.

And if a venue says no? They’re not being stingy—they’re just trying to survive.

Like what you’ve read?

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