Tag Archives: restaurant wine prices

Winebits 782: Restaurant wine prices, consumer sentiment, glass recycling

restaurant wine list
“Yes, the wine costs more than the rest of your dinner. It’s restaurant wine, isn’t it?”

This week’s wine news: Why restaurant wine is so expensive, plus consumers want lower prices and Spanish producer aims at recycling

• More sad news: How does $17 a glass for restaurant wine sound? No, I’m not making it up. Rather, Esther Mobley reports in the San Francisco Chronicle, that’s the normal price of a glass of wine at Bay Area restaurants. She lists the increases at several of the region’s “affordable” wine list spots, and some are even more than $17. The reasons are familiar (inflation, high business costs), but the results show once again that wine in restaurants is increasingly reserved for aging Baby Boomers, tech moguls, and the rest of the one percent. That’s hardly good news for wine, is it?

• Lower prices: Kroger says “saving money is top of mind for shoppers.” There are some caveats to the results of this survey; it was conducted by a Kroger subsidiary, for one thing. But tits finding are still worth nothing: 56 percent said saving money is their top financial resolution for 2023, while almost tow-thirds are scaling back on non-essentials and just short of one-half are purchasing fewer items. This is more bad news for wine, which is not an essential and which can be given up to save money by people want to save money.

• Bottle recycling: Spanish producer Familia Torres is trying to set up a European system for reusing wine bottles. Torres has long emphasized green policies, and it even has an executive with the title “director of climate change.” The story says the company wants to establish bottle standards to work across the European Union – size and glass ingredients, for example, so that a German bottle could be recycled in France, a Spanish bottle could be recycled in Italy, and so forth. Are you listening to this, Big Wine?

What’s next for restaurant wine?

restaurant wine list
“Where’s that $750 bottle? Let’s get a couple.”

No, it’s not lower prices – how about more famous brands and fewer interesting wines?

One of the biggest wine questions, as we come out of the pandemic: “What’s next for restaurant wine?” One international study says to expect more of the same – which means higher prices, less selection, and more famous brands.

“It became clear that there’s been a deep shift in restaurants.” including sommeliers pruning lists, buyers being much more selective, and restaurants focusing on the most well-known wines, says Pauline Vicard, the CEO of ARENI Global, a consultancy that studied wine lists in key cities around the world. And, if you’re a small or lesser known winery, it has become that much more difficult to get on lists.

A couple of caveats: First, the study looked at just a handful of international cities, and New York and San Francisco were the only ones in North America. So what’s true in those two places might not be true in Atlanta or Houston or Los Angeles. Second, the study only looked at high-end restaurants serving “fine wine,” so what it found might not apply to the Italian place on the corner.

Having said that, a couple of trends probably apply, regardless. First, restaurant wine, despite its problems over the past 10 or 15 years, remains hugely important. The study estimates that restaurants account for 30 percent of total European “fine wine” sales. So producers, despite sagging restaurant sales, are still desperate to get their wines on lists.

Second, pricing remains counter-intuitive. Want to lure diners back? Then shouldn’t wine cost less? But that wasn’t the case in New York or San Francisco. In each city, restaurants took more “entry-level wines” – those costing less than $100 – off lists than at any other price. In 2022, only out of six wines on New York lists cost less than $100; it was about one in five in San Francisco. But one in four wines, more or loss, costs more than $750 in each city.

Can someone explain how that will bring me back — let alone younger consumers?

Welcome back, restaurants: Please let wine drinkers help you return to normal

pandemic wine
Want to fill those empty tables? Then meet wine drinkers halfway.

Five suggestions to increase restaurant wine revenue and make wine drinkers happy

Dear restaurant business:

I know we haven’t always been on the best of terms, given restaurant wine prices. But that doesn’t mean I don’t want restaurants to recover as we begin to come out of the pandemic. Because I do understand how bad the past year has been – in jobs and store closings, as well as $27 billion in lost sales.

And, despite our differences, we both understand that restaurants and wine are part of each other – when one suffers, we both do. So please, don’t exclude wine drinkers as the recovery begins. Let us help you:

• Don’t take us for granted, and assume we’ll be back just because. Because we may not be. Many of us discovered that home cooking isn’t as bad as we thought it was.

• Keep experimenting. Many operators tried something different during the pandemic, and much of it worked out quite well. Or, as one Texas restaurant official told me about cocktails to go: “How do we help to provide opportunities for restaurants, and especially since what looked like it was going to be a two-week crisis has turned into 10 months? This was a way to do that.” So why stop experimenting now?

• Meet us halfway on pricing. Why expect the old rules from the old normal to be relevant given all that has happened? So consider (where legal) offering wine bottle discounts. Or (again, where legal) buying two or three glasses to get the next one free. Or even cutting wine markups from 3- and 4-to-1 to 2- and 1½-to-1. As noted on the blog many times before, this can bring in thousands of dollars of revenue that would otherwise be left on the storeroom shelf.

• BYOB is an opportunity to regain customer loyalty and trust, and not – as some complain – lost revenue. What better way to win back those of us who enjoy drinking wine with dinner than to let us bring it to your restaurant? We would be happy to pay the corkage fee, and you’re getting two or three or four people at the table who might otherwise stay home.

• Shake up the wine list. Offer us something that we haven’t seen at the supermarket or Drizly or a chain retailer. This is an opportunity to replace the wholesaler-driven, Big Wine brands that you use because it’s easy, with wine that’s interesting and different. Which is how you think about your food, isn’t it?

As always, let me know if there is anything else I can do to help.

Your pal,
The Wine Curmudgeon

Photo: “Restaurant tables” by TChapman9 is licensed under CC BY 2.0

Restaurant wine prices 2018

restaurant wine pricesSome restaurants are moving away from traditional wine pricing, and selling wine at prices we can afford to pay

There’s actually some good news surrounding restaurant wine prices 2018 – which is especially welcome after 2017’s higher prices and, not surprisingly, flat consumption.

I’ve talked to a number of restaurant officials in different parts of the country over the past two or three months who are being more aggressive with pricing. That includes extended half-price wine nights, half-price wine happy hour promotions, and even – as difficult as it is to believe – lower markups than the traditional 3 ½ to 4 times wholesale.

Yes, this is a small sample size, and there remain too many restaurants that consider charging $30 for an $8 retail bottle of wine their inalienable right, just like freedom of speech and assembly. But good news is good news.

Perhaps even more important: The restaurants that are cutting wine prices are seeing impressive results. An Italian restaurant owner in New Jersey told me his second biggest wine night of the week is half-price Monday, second only to Saturday night. Ordinarily, Monday is one of his worst days for wine sales.

In New Orleans, meanwhile, the general manager at a popular French Quarter restaurant said half-price wine happy hour has done the impossible – keep his restaurant busy between lunch and dinner, usually a dead spot. In this, he said, given the choice between a packed dining room and traditional wine pricing, he’ll take the packed dining room every time.

A few other notes from my reporting and research on restaurant wine prices 2018. Unfortunately, in these cases, the more things change, the more they stay the same:

• A Dallas seafood restaurant that caters to the city’s social and political elite has about one-third more red wines on its list than whites. And the markups remain mostly 4-1.

• The restaurant business’ leading trade magazine recently ran a very basic story about how to put together a restaurant wine list, the kind of thing I might write for the blog. One would like to think that anyone reading that magazine would already know how to do that. That the story still ran speaks to the need for basic wine list information – which, actually, shouldn’t be surprising. Also not surprising: the story didn’t mention pricing at all.

• Where are the young people? No matter where I eat (and not just in Dallas, where wine is still seen as exotic by many diners), I don’t see enough Millennials and Gen Xers drinking wine. I’ve been coast to coast this spring, and most of the wine was being consumed by older white couples – even in restaurants where where there were lots of younger people. One more reason why I fear for the future of the wine business.

More about restaurant wine prices:
• The John Cleese Fawlty Towers guide to restaurant wine service
• Restaurant wine prices explained: Follow the money
• Winecast 28: Bret Thorn, Nation’s Restaurant News

Winebits 511: Frey Vineyards, customer service, restaurant sales

Frey WineyardsThis week’s wine news: U.S. organic wine may have suffered a serious setback when Frey Vineyards burned, plus customers want top-notch service and more bad news for restaurants

• Organic wine: Frey Vineyards, destroyed in last week’s wine country wildfires, was one of the leading organic producers in the country, one of only two or three with national distribution. Its destruction deals another setback to organic wine, which has never been as popular as other organic food products. It accounts for less than five percent of U.S. wine sales; that compares to the 13 percent market share for organic fruits and vegetables. I’ve written a lot about why organic wine does so badly in the marketplace, but the best explanation is so simple I’m embarrassed I didn’t think of it. Says Tyler Rodrigue, an organic viticulture consultant in northern California. “Consumers assume that wine, by its very nature, is pure and natural to begin with. Ask most consumers, and they don’t equate a vineyard with a factory farm the same way they do for other products. Vineyards are beautiful, and don’t look like a picture of a factory farm.”

• It’s all about customer service: The Wine Curmudgeon is the son and grandson of retailers, so this study from a company that tracks on-line reviews called Trustpilot isn’t surprising. We want better service when we shop on-line, even more than cheap prices. Which is what I heard when the subject came up at the dinner table, which was more often than not. Says the report: “ ‘Price’ only shows up around in 4-5% of 1-star reviews and in 10% of 5-star reviews, significantly behind the top five most common words.” Why does this matter to wine retailers? What’s more confusing than buying wine? What other category requires service to find something to buy that is enjoyable? In other words, fake discounts and shelf talkers blaring 92 points aren’t enough. We want a person to answer our questions knowledgeably and intelligently.

• Restaurant sales continue to slump: How bad has the restaurant sales slump become? So bad that the people who parse the numbers are desperatley looking for silver linings. Throw out the hurricane states from this summer’s sales figures, and the decline in sales from month to month are less than two percent. Not much of a silver lining, is it? Or, as the chart with the story shows, same store sales have declined for 11 of the past 12 months. We’ve written about this on the blog many times, since poor restaurant sales numbers usually mean higher restaurant wine prices, as operators increase wine prices to make up for losing money elsewhere. No doubt this will continue to happen.

Restaurant wine prices explained: Follow the money

restaurant wine pricesRestaurants have millions of dollars in reasons not to price their wine fairly

Restaurant wine pricing has bewildered all of us for years, and never more so in the past 18 months. Why, given that restaurant wine sales are so sluggish and prices are so high, haven’t restaurants cut prices to boost sales? Instead, just the opposite has happened.

I’ve written about this on the blog. We’ve discussed it in the comments. I’ve even interviewed experts, and they were just as baffled as the rest of us. And if you talk to restaurant types, as I have, you’ll get a hem and a haw, but nothing to really justify the high prices.

Until now. I’ve spent the past couple of days perusing mixed beverage tax receipts compiled by the state of Texas, and the answer has become abundantly clear. Many restaurants don’t sell enough wine to make it worth their while to price it more fairly, and those that sell enough don’t have any reason to do so.

Or, rather, have millions of reasons not to do so.

In September 2016, nine restaurants in the state sold more booze than the highest-ranking strip club, and strip clubs exist to sell overpriced alcohol. That’s nine individual restaurants, not chains, and one of them did $800,000 in alcohol sales. The best the strip club could do was $551,000, which was just $4,000 more than the 10th best restaurant in the state.

That’s more than $6 million a year for the top 10 restaurants. And every time I looked at the list, I found something else that stunned me. A restaurant where I have had many wine lunches and where the wine list is quite ordinary: $1 million a year. Another, where the food is quite reasonable but with an even less distinguished wine list: $400,000 a year. A chain Chinese restaurant in the north suburbs: $500,000.

Those are mind-boggling numbers, and explain all. How much more could you sell if you priced the wine fairly? Probably not enough to make a difference. I’d even think about marking wine up four times wholesale for results like that. And I’m one of the good guys.

The caveats: The totals here include beer, wine, and spirits, and the restaurant business in Texas may not be representative of other states. Still, I’m trying to compare apples to apples. Hence, I didn’t include Mexican restaurants in my analysis, where margaritas will boost the numbers, or bars, which don’t sell much wine. The restaurants I’ve cited here are medium- to high-end, many steak houses. One, in fact, even boasted about its wine list helping it sell one-half million dollars in alcohol last month.

Not very good restaurant wine price news to start the new year, is it?

Image courtesy of Wine Folly, using a Creative Commons license

British restaurants to customers: Sod off

restaurant wine pricesBritish restaurant wine prices are ridiculously high, just like those in the U.S.

British journalist Matthew Bell is even more angry about restaurant wine prices than the Wine Curmudgeon is.

As he writes in London’s Daily Mail newspaper: “But if you think you’re paying a reasonable price for a decent bottle, think again. … restaurants are relying on the fact most of us don’t know much about wine to squeeze the biggest profits out of frugal diners.”

Which, as regular visitors here know, is something we’ve been warning consumers about for the past couple of years. As restaurant traffic and profits slump, they’re using wine to make up the difference – and gouging those of us who want a quality bottle at a fair price.

As Bell writes: “Take The Connaught hotel restaurant in London, which has two Michelin stars, and where a meal for two can set you back £300 (about US$381). A small glass of house white (125ml) costs £10 (about US$13). But go on-line and you could buy a whole bottle of the very same wine for just £9.70. That represents a mark-up of a staggering 500 per cent.”

There’s a terrific chart with the story showing the markups at four London restaurants – 300 percent for a couple of simple Italian white wines, 312 percent for a French red posing as a house wine, and 233 percent for another French red.

In other words, British restaurants are doing the same thing to their customers that U.S. restaurants are doing to us, and a London food critic calls it a big problem. Would that food critics in this country noticed the same thing.

And the results? Writes Bell: Those of us who don’t know much about wine are left “with an unenviable choice — either we pick the cheapest, and get ripped off; or go upmarket and spend more money, when all we ever wanted was a simple glass of wine.”