Not really true when it comes to wine. Wine has the lowest markup in restaurants for everything except steak.
Rick, nice detective work. 3x wholesale tends to be industry standard. No restaurant uses retail for pricing their list.
Veuve Clicquot Yellow Label retail: $49. At The Carlton: $96. I’m not saying I have a problem with that, but it’s nothing like the pricing you said they use. This example seems to be about their standard, and you’re citing them as a restaurant that’s famous for low pricing.
This is hilarious. No place that people on this board would consider going to (if spending any amount of time considering) charge a cover to sit down in Europe. Not saying you cannot come up with one or even five examples, but I have NEVER paid a cover charge at a restaurant in Europe. I likewise was not charged a cover last time I was in Brazil, but I avoided the tourist hangouts. I’m at a restaurant in central Brussels right now.
I have seen this all over Italy (out in wine country and even in rural Puglia, not just in Verona or Rome) and I’ve almost never seen a place in Brasil without it (we NEVER go to tourist trap places as my wife is Carioca, I speak fluent Português and we have been all over the country many times). There it will be placed on the check where we would put tax (which is included in the prices there) and will say “couvert” then a small amount of Reals. In Italy, it is “il coperto”. From Yahoo Travel Guide:
• Cover Charge- Restaurant prices in Italy seem a little strange to foreign tourists from the United States. Restaurants charge each customer a “coperto”, which is a cover charge that usually ranges from 1.5 Euros to 2.5 Euros per diner. When these fees are assessed, customers are not expected to leave additional tips. However, occasionally a restaurant in Italy will also charge a 10% service fee in addition to a “coperto”. You can shop around when looking at restaurant menus for lower prices, but know that when restaurants advertise “no service/cover charge” (ie. No “coperto”) this means the coperto is likely built into the food or beverage prices.
• Table Charge- Bars and cafes in Italy will normally post two different prices for food and beverages- the “banco” or counter/bar price, and the “tavolo” or table price. Tavolo is always considerably higher, sometimes even double the banco price. So if you are on a tourist on a budget when traveling in Italy, specify “al banco” when ordering and you will have to stand at the bar, but you will also save money.
Much more info:
I’ve definitely seen this. I was puzzled when I first saw the menu listing different prices, but I understood after the 3rd or 4th place in Paris. ha. Mostly street side cafes tho
Particularly rich information on il coperto in Italy:
Thomas K: “No place that people on this board would consider going to (if spending any amount of time considering) charge a cover to sit down in Europe.”
There are dozens of folks here who have been to Verona for VinItaly at least once and quite a few who have done so many, many, times. I would be shocked if they had never stopped and had an Aperol Spritz or a nice glass of Amarone at one of the Piazza Bra places facing l"Arena or one of the many bars on Piazza l’Erbe. They ALL charge il coperto.
True, but they should be cognizant of the retail price and how it might affect how their list is perceived. In general, at least here, the above markups are close enough that someone would think “Oh, that’s 2x retail…” if they think about it.
While wine might have a fairly low markup in percentage terms, I can’t think of another item that, as a single serving, brings in more dollars. Liquor, probably, but no one buys a bottle of booze with their dinner, they buy a drink.
There is a place in Atlanta called Brooklyn cafe that sells wine at essentially retail. I think Shafer 1.5 was $5 less than the winery. Seed Restaurant in east Cobb area of Atlanta also has good wine at close to retail.
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Rick, bottle service is all the rage with the kids these days in retro style “supper clubs” with Rat Pack aspirations. $200 bottles of Grey Goose, $500 bottles of Hennessey…with dinner, not in a dance club. Some places will not give you a table UNLESS you buy a bottle. The Vegas Effect is creeping in all over the place.
Of course, my girlfriend’s wine bar charges flat out retail for bottles consumed on premise. Shameless plug.
You’re forgetting the soda that costs $2.50 and costs the restaurant $0.02.
Whenever I wrote a wine list I took great pains to make sure I didn’t list popular retail wines. I would also let the wholesalers know if they wanted a stack display at the local grocery store then don’t bring me the wine for my program.
Per serving most drinks are more expensive than wines by the glass. If a bottle of wine sells for $40 let’s say. It’s wholesale is probably around $13. So it will generate $27 in gross profit but that’s for 4 servings essentially. Not out of line IMO.
I will only say this about the general subject here. You cannot compare the price of wine in a restaurant with retail. The cost structure is completely different. Most restaurants cost millions of dollars to build. I’m just talking about the interior here. Not property and building. retail stores generate millions more in revenue than restaurants do with substantially lower fixed costs and labor per revenue dollar. Any comparison is quite frankly fallacious.
It’s not shameless unless you tell us the name of the place, Jim. So what is it?
It’s in my signature as part of my disclosure of being and living ITB.
Oh, I wasn’t thinking of stacked wines at Safeway, but using wine shops as a comparison point. Of course, that’s not important unless you’re attracting a fairly geeky crowd.
Per serving most drinks are more expensive than wines by the glass. If a bottle of wine sells for $40 let’s say. It’s wholesale is probably around $13. So it will generate $27 in gross profit but that’s for 4 servings essentially. Not out of line IMO.
Sure, but that misses the point that no one customer buys a bottle of liquor except in edge cases… They do buy a bottle of wine (I’m ignoring the BTG issue…). So, for sheer dollar profit, the bottle of wine seems to me to be pretty much at the top of the heap. 3x wholesale isn’t bad - I’m not suggesting it is. Beyond that is where places start to feel greedy to me.
Big +1 on this. I’ve worked both high-end on- and off-premise, and, while I hate paying restaurant prices, I do understand why they are what they are.
One night drove home the difference. I was looking at the totals of my first really busy night as manager/sommelier at a restaurant that had been a WS Grand Award winner until a few years before I took it over. And, think what you want to think of those awards, but you don’t get one without maintaining a pretty largely-scaled list. The restaurant was small for a list so big (part of my job was to improve its flaws while shrinking its scale - it was an interesting challenge) - firing on all cylinders we could probably do 175 covers in a night. One of that restaurant’s best holiday evenings - one that made the new owner giddy with joy - took in the same revenue the good medium-sized retail shop I ran took in on a decent off-season Friday.
On any given night in a restaurant, the number of customers you will serve is limited to how many people you can serve a good meal to. The amount of alcohol they will buy is limited to what they can consume on-premise. In an off-premise account, you may have one customer come in and buy a bottle. Another might buy a case. There is no ceiling out on the number of bottles I can sell off-premise besides what I have on hand. On a busy holiday night in a restaurant, I might sell eight cases of wine, I could do that in an hour or less at retail. Whoever said upthread that he couldn’t imagine inventory turn was that different is wrong, simply put. Customer volume and turnaround at retail is so much faster than in a restaurant, even in much higher volume venues than the one in which I worked.
You also have considerably less to pay in salary on a given shift off-premise. I’ve seen good small retail shops have two or three guys working. A medium-sized one might have five to ten, several of whom are likely part-time and low-cost. Even a slow restaurant would go down in flames with such a short staff. If you do lunch, figure you have at minimum two hostesses, two bartenders, two managers, three servers - not to mention food runners or bussers if the restaurant runs like that. We aren’t even getting into back of the house, where you will have at minimum three cooks and a dishwasher - and that’s on a slow night in a decent small restaurant.
Put another way, I’ve seen top restaurants brag that they have two, or even one employee for every diner in the restaurant that night. Ten people can serve thousands off-premise. The money to pay the on-premise staff has to come from somewhere, and its either tips or margin.
Can one of our computer savvy folks (I’m talk to you Levine) should make a “Farmville” style on line game where Berserkers get to try and run their own restaurant while the program throws everything from bad weekends due to Lakers games to dishwashers taking cases of lobster and beef out with the trash to complete meltdowns of the refrigeration systems at them.
Like blind tasting, it could be very humbling.
When I lived in Princeton in the late 90s, the top restaurant there was taken over by a guy who made a fortune on Wall Street and openly asked “how hard can the restaurant business be if I made it in finance?” as he was getting his feet wet. I think he drowned within in a year. Maybe two. FWIW, Princeton does not hand out liquor licenses lightly (if at all), and he bought two restaurants and moved the license away from the already successful one to the new one and made the successful one BYOB. Both died quickly in light of his Wall Street “fortune.”
Where I live now, every fine dining restaurateur quietly prays for KU and MU basketball to flame out early in the NCAA basketball tournament. Three winters ago, three consecutive December weekends with snowstorms put several restaurants under for good, and the ones that survived still talk about it.
While we’re at it, why don’t you try running a software firm or… Oh hell, both ideas are idiotic.
No one is disputing that it’s hard to run a a restaurant. You’re arguing against a 
.