Figuring Out Restaurant Wine Pricing

Ever wondered why there is so much disparity in wine prices at restaurants? And I am not just talking about the difference from retail to restaurant, but from restaurant to restaurant.  A cool article in the Wall-Street Journal came out today talking about this very topic and gives some insight into how the pricing structure works for restaurant wine lists.  It also has a cool interactive map that has 5 different wine bottles and looks at the huge variance in price as you move across the country.  I know that here in Richmond, there is a very big difference between restaurants, even on the same street, much less the other side of town.

 

A brief excerpt from the article:

“The first step to finding better deals on wine is understanding the formula behind most restaurant wine pricing. The standard restaurant markup is about three times the wholesale cost, or about twice the retail price. In most restaurants, the markup decreases as the wholesale price of the bottle increases: An inexpensive bottle might be priced three to four times its wholesale cost, while a pricey wine may be marked up only 1.5 times. This so-called progressive markup helps sell more expensive wines.”

 

Check it out, it is a good read.

 

Cheers!

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Categories: wine industry issues | Tags: , , | 3 Comments

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3 thoughts on “Figuring Out Restaurant Wine Pricing

  1. Great article. I’ve always used the twice retail bar to gauge a wine list. And invariably I will spring for a higher end wine if the mark up is more like 1.5 times retail. What really irritates me is high end multiple location establishments that should be getting good deals based on the sheer amount of wine purchased and these places charge 3 times retail – even on the high end bottles. If I’m dining at one of these places, I will order one cocktail and skip the wine.

  2. this is great. everyone should read. i travel a bit and it just make me see read when i am in a city that has restaurants that allow you to bring in your own bottles wine such as in jersey. i want some of those establishments here>

  3. In Richmond, Enoteca Sogno has one of the gentlest wine mark-ups (basically 1X, just a bit over what you could get the wine in a retail spot) and a super list of Italian wines-partly due to the owner’s philosophy and partly due to the lower rent he pays for the space (at a place like Flemings, they have to pay premium for the space and this trickles down to the wine list). Full disclosure: I sell Enoteca Sogno wine.

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