So you're a working-class kind of guy who pulls the Ford F150 outside of the local watering hole and kills the engine only after your favorite John Cougar Mellancamp or Clutch song begins to fade into the outro. As you remove your Oakley wrap-around sunglasses and as your eyes adjust to the dimness of the bar, you begin to notice a variety of whiskeys that seem intriguing. However, you don't want anything too fancy.
“Pour me a Jack Daniels,” you say.
The bartender nods, and puts a single of JD in front of you. “That'll be $9,” he says. Normal day, right? Nothing out of the ordinary here, yeah?
Considering that a whiskey bar might have several bottles at the ready with prices (gasp) of twice as much as that pour of JD you ordered, it certainly seems like you've dodged a bullet and saved some money. It was less expensive than most other stuff on the menu.
Or we could look at it another way: like a chump, you just paid nearly an 800% markup for whiskey that has a fair market value of about a dollar a shot.
During one particularly slow weekend, I crunched some numbers of random bottles of whiskey that could be found in five bars in the LA area. Now, rent here is expensive, and you might find your local watering hole a little cheaper, but there's an interesting phenomenon that I would argue holds true just about regardless of where you are, from Manhattan, NY (would love to visit) to Baker, CA (it's super hot and the town's only claim to fame is a big thermometer).
Plotting more than about 135 different data points, the distribution of the data is roughly logarithmic, which is to say that it spikes as the price of a bottle gets closer to zero and flattens out as you move farther away from it. There are a lot of statistical asterisks here, but here's the takeaway: your markup is far, far higher on cheap booze than ultra-premium stuff.
BOTTLE PRICE VS. POUR VALUE
That point all the way to the right is a shot of Ancient Age. It's a bourbon that comes in a jug with a handle on it. $8 a shot seems initially reasonable when you don't consider that the bar price of that brown liquid is more than 1600% of its store-bought value. On the other end of things, Macallan 18 makes up the 3 farthest points to the right, with a massive price variation of $25 to $50 a shot. But even at Mac18's priciest, the markup is always less than 400%.
In my opinion, we can basically split the graph at a certain point to arrive at the following conclusion: If you're buying a shot of anything that costs less than $40 a bottle, you're getting flogged harder than Jesus in that one Mel Gibson movie.
If you're buying anything at a bar that's more than $40 a bottle, you aren't getting manhandled too badly and will in general get more value for spend. A relatively scant 200% markup was par for the course for most whiskeys costing more than $100 a bottle.
What does this mean?
I once looked askance at ordering whiskey from a bar for the longest time, since my only experience was with bars serving your supermarket-available brands. Why buy a shot of something for $8 when a fifth of the stuff costs $17? Now that I crunched the numbers, I'm more willing to try two or three shots of something at a high-end whiskey bar as a means of collecting data for the purchase of a whole bottle. To me, it's worth paying $15 to see if I like a mid-ranged malt before I plunk down $70.
Long story short, just stop ordering JD at bars. You're my friend, and I want you to be happy, but I can't stand to see you do this to yourself any longer.