What margins and commitments do major UK retailers expect from drinks suppliers?

Retailer margins vary significantly by channel and retailer type. **Off-trade (retail) margins** typically range from 25–40%, though some premium retailers push higher and occasional outliers demand 70%. **Premium supermarkets** (Waitrose, Sainsbury's) calculate margin as NOG (Net on Gross, including VAT), targeting 20–25%; **value supermarkets** (Tesco, Asda) use POR (Profit on Return, ex-VAT), targeting 27–32%. Margins are often blended between on-promotion and off-promotion prices, and the retailer will guide expected basket mix. **Premium independent retailers** like Daylesford may expect margins around 55%. **On-trade (pub) margins** are much higher: independent pubs typically seek 60–75% gross profit (calculated on per-serve pricing, e.g. 10 serves × 6 margin = 60% vs. purchase price). Pubs standard gross profit is 70–72%. **Harrods** specifically targets gross profit of 42–45% and expects back margin of around £1m annually; spirits buyers are nick.fleming@harrods.com and wines buyers are siobhan.irons@harrods.com. A key note: Harrods' vodka and gin sales are weak (c. £3k/week) compared to whisky, Bordeaux and burgundy (£100k+/week), and baijiu and tequila significantly outsell gin and vodka—listing there is a lighthouse for brand and export positioning rather than volume. Members caution that some retailers (e.g. Whole Foods) may not suit alcohol due to margin constraints, and retailers like Cress may demand unsustainably high margins relative to volume opportunity.