Just generally curious about this topic because after researching a bit I haven't been able to locate a solid resource on this. I want to know the business side of wine lists a bit more. I studied business in college, but not in relation to wine. I understand contribution margins, COGS, etc, but I'm interested in how to price and how to decide how the wine list will perform.
Any resources or help would be appreciated!
Well for most major markets Restaurant (DC, Boston, San Fran) the industry norm is a basic mark up system. For wines by the glass you mark up 4X if a buy a bottle for 10 a bottle I ask 10 for a 6oz glass so I pay for the bottle with the first sale. For most by the bottle wine its a 3X mark up, if I buy for 50 I ask 150. This scale works most of the time. As you get more and more expensive wines you usually decrees the markup a bit, especially if the wine isnt that hard to get IE Dom Perignon pricey but not hard to get even in large amounts so I only mark up x2. If a wine is expensive and very hard to get IE Screaming Eagle Cab I can only get 3 bottles a year I will stick to the 3x markup or sometimes even more because I dont really want to sell it to fast as it looks good on the list. Every business has a different model, Im sure someone with alot of corporate wine experience will be able to provide you with a more scientific way of doing this. If I was looking to price a list in a city I didnt know well I would get a few copys of wine lists from places in the same food style and price point as the restaurant I ws working with and see what they asked for wines and then look up the cost if those wines, I think you will find many stick with the 4x 3x system. Cheaper prices dont always mean better sales, I now work for a restaurant with a huge library of older wines, We have many many cases of a wine I wanted to sell off as it was getting a bit too old, it was still drinking great but I didnt want to keep it for a long time, The price had been 155.00 a bottle so I dropped it to 99.00 it didnt sell very well, When I asked a few of my better clients why they hadent taken advantage of the savings and they said "at that price I assumed there was something wrong with it"..LOL go figure.