In Defense Of Restaurant Wine Prices

WINE TALK
41

I don’t get your line of thinking here Michael. I guess you believe that the restauranteur’s freedom to price his or her bottles as they please, trumps the freedom of the wine geek to criticize them? As customers we absolutely, positively don’t need to become proprietors to validate our opinions on price of goods, we just buy or don’t.

42

I’m simply pointing out that the most effective way to protest high restaurant wine prices is to not buy the wine and/or don’t patronize the establishment. Venting here may be entertaining but I’m sure quite ineffective.

43

Ah, so you’re saying it’s pointless to use this place to talk to each other about wine. [welldone.gif]

Who started this thread again?

44

If it makes you feel good to talk about what you think should be, and complain about what is, you have my blessing.

45

Maybe, just maybe, there are some propietors of restaurants and wine bars reading these threads?

46

I don’t want to encourage you brother Yankee fan. [wink.gif]

47

We all are used to seeing the “what is the point of this discussion? Sheesh” responses in message board threads. They just aren’t usually by the person who started the discussion.

48

Same thread, different title.

49

I don’t disagree with this, but the fine point was made earlier, that best of all is to raise the issue with the proprietor. Not something I would generally be comfortable doing, after all I am English and we do like suffering in silence or muttering under our breath :wink: That doesn’t stop it being the right thing to do.

50

I knew the replies that continued to suggest that restaurant wine lists needed to be better conceived or priced would be coming. I simply pointed out that the original premise is that the myopic, self-interested points of view of wine geeks (myself included) is of little or no value to someone with millions on the line running a business.

51

But the fact that they have millions on the line in no way means that they have the business acumen or knowledge to make the right decisions, or to evaluate the quality of advice they receive from consultants and advisors. There is a lot of simply following the examples of others without understanding why another’s model won’t work for them.

For example, skilled young chef opens NY restaurant with young somm friend and adopts Jean George wine list model. While the food may be comparable, unless the restaurant is also a destination spot with lots of less price sensitive tourist and expense account diners, the wine pricing model won’t work the same way.

I’ve noticed that many in the restaurant trades can be slaves to margins over dollars as well. Don’t get me wrong, not knowing margins can be a business killer. But being a slave to margins can be as well. Too many restaurants fail to realize that hitting lots of singles and doubles with lower prices on wine can increase volume and generate more profit than trying to hit a home run with each bottle.

52

Huh?

It seems to me that what would be of most value to a restauranteur is implementing a strategy that maximizes the total gross profit from wine (wine revenue - direct wine-related costs). If I understand your point correctly, you seem to be asserting that the stategy imployed in your initial post achieves that goal – but you don’t provide any data to support that assertion.

By the way, I’m not arguing that it’s the wrong strategy – but I do know that many restaurants thrive with alternative approaches. Meanwhile, I’ll continue to be thankful that almost all restaurants in the Puget Sound region allow BYOB, with reasonable corkage fees. That allows me to move forward blissfully without any angst about restaurant wine pricing. champagne.gif

Michael

53

When it comes to wine prices and elasticity of demand in the face of price differentials, there is a tremendous difference between the retail model and the restaurant model. If you live in a city with a number of different retailers (or can have wine shipped to you), if one retailer prices a typical bottle $20 more than other retailers, consumers can pretty easily figure out the pricing differential and adjust their buying habits.

In a restaurant, however, most people go because of the food, NOT the wine list/wine prices. Frankly, there is not much comparison shopping that takes place with restaurant wine lists–a lot of diners don’t know what a “reasonable” wine markup might be. And once you’ve sat down at a restaurant, how likely is the diner going to be to get up and leave because Silver Oak is $20 more on this list than on another list across town?

What may change the dynamic is if more diners use various wine apps that let them look up wine prices online to assess just how reasonable the restaurant wine prices are. If more diners knew that the $200 wine on the list actually retails for $75, then it’s possible that more diners might change their ordering habits at some restaurants.

Bruce

54

Really? Where are you going to find a group that populates fine dining more than on this board? I think you will find a consensus of opinions that think pricing on today’s upper tier wine lists has gotten out of hand - these restauranteurs are living in the 60s and 70s and THEY are the ones that are usually complaining about not having a sophisticated enough clientele to pay their exorbant, way out of wack pricing. While the restaurants that are pricing their lists for fast resale don’t have the time to read this board because they are spending all their time replenishing their wine inventory because it is turning so fast.

I call on restaurants for a living, selling wine, craft beer and craft spirits, and I am seeing more and more restauranteurs changing their policies and using a much less markup on their higher priced wines, intent on making their money on wines by the glass and the lower tier (An $8 Cotes du Rhone can fly off the list at $32 - what more do you want?) - rather than just collecting another museum’s worth of wines no one will touch.

55

Michael,

I disagree with your statement that the restaurant “is there to make as much money as possible and what needs to be done is all towards that end.” Seriously? I know plenty of people who own their own business (restaurants and others) who are not there “to make as much money as possible.” And not everything “done is towards that end.” I count myself among them. Most folks I know in the restaurant business have many reasons for being in the business. Do they want to make money? Sure. But it’s not the raison d’être of their business.

I’m also not sure why you’re dissing folks for giving their divergent opinions here when the last line of your OP was, “Your thoughts?”. [scratch.gif]
Edit: I see that you did address this part in Post #50.

56

Yes, wine enthusiasts may patronize fine dining establishments more than most, but going there and spending meaningful money are not necessarily congruent. In fact, I think a case could be made that in many cases, the wine obsessed are actually more trouble than they are worth. (Once again, I include myself.)
I’ve long been fascinated by what I call “the illusion of intimacy” that good servers and by extension good restaurants must create to have happy customers. What I am talking about is, as restaurant patrons we expect a level of attentiveness, care, and pampering that is usually only found within the confines of the home and extended to friends, family, and loved ones. Skillful restaurant employees learn not only to do this, but make us believe that it is heartfelt. But there is a saying in the restaurant business: " butts in seats" or perhaps " asses in chairs". This is the part of the business that is behind the veil. They provide the “illusion of intimacy” but expect significant compensation for the effort. That’s the way the game is played. So it’s not how much one appreciates great food and wine that really matters, but how much money that is left behind at the end of the night.

57

I guess the whole premise of this thread frustrates me. I go to restaurants because I’m an inveterate foodie and have been for a long time. While I am only rarely scared/mystified/saddened/insulted/angered by the price of food in restaurants because I pay for artistry, ingredients and service and am happy to do so, I am almost always flummoxed and dismayed by wine pricing in restaurants. My budding cellar is scarcely 1000 bottles but I have been collecting, or at least frequently buying, wine for ten years or so and, in that time, I have bought wine in restaurants by the bottle maybe 30-40 times because it just seems like a waste of money. And to tip for the wine on top of that, after a 300% markup? Screw you! I will pay a $25 corkage any night, or even $35. After that, screw you! I know some wonderful somms, and as I get to know my tastes better, I am less and less likely to enjoy wine lists at restaurants with the rare exceptions of those somms, and often the reason I like their lists is because they’re populated with wines I either already know or have in my cellar.

I also have been a big supporter of the DC cocktail scene for years, and again, I am happy to pay for the effort and the artistry. $16 a cocktail? No problem. But wine in restaurants is a racket - they buy bottles for wholesale prices, do nothing but pop a cork, and for that they markup x3 retail? Even if food costs are only 20% in a fine dining establishment, everything else that goes into food preparation (not service - that is paid below minimum wage in most states and is almost entirely subsidized by your tips) is expensive. As a former cook, I respect that.

But wine prices in restaurants are indefensible except in that amoral, purely capitalistic sense of prices being whaever the market will bear, which is not a justification that bears any weight in my tiny little besotted mind. And the argument that restaurants don’t make money on food and need to make money on booze to stay afloat still doesn’t justify the price gouging. Only the fact that there are people out there that are willing to be gouged allows it to happen.

58

I’m with Noah on this one - well put - and Noah is a classic example of someone who would purchase kinky upscale wines on a list if they were priced right every time he went out for dinner rather than 3-4 times a year.

59

[thumbs-up.gif]

60

Just think of it as a counterpoint to the continual whining about how unfair restaurant wine prices are.