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.