Please consider taking a look at the latest entry in the MiamiWine
blog, http://miamiwine.com/:

"Restaurants and Bars Jacked-Up Wine Prices: Ten Years of Data"
Excerpt: I don't mean to keep ragging on the hospitality industry, but
the data seems to indicate that restaurants and bars have in recent
years significantly increased wine prices far above not only the rate
of inflation but the price of wine we can pay at retail shops.

Thanks.

Leo

On Sep 21, 3:03 pm, Leo Bueno >
wrote:
> Please consider taking a look at the latest entry in the MiamiWine
> blog,http://miamiwine.com/:
>
> "Restaurants and Bars Jacked-Up Wine Prices: Ten Years of Data"
> Excerpt: I don't mean to keep ragging on the hospitality industry, but
> the data seems to indicate that restaurants and bars have in recent
> years significantly increased wine prices far above not only the rate
> of inflation but the price of wine we can pay at retail shops.
>
> Thanks.
>
> Leo

Hello Leo,
It seems that it has become my job in the last few years to explain
the difference between retail and restaurant on the internet. Pardon
me if I sound like a broken record, but, here goes:

1) Wine shops have 2- 10 employees. Restaurants have 20-150 employees.
You mention the rate of inflation in relation to wine prices, but have
you noticed that the cost of benefits, ie: health, medical, dental
insurance has increased far faster and higher than the annual rate of
inflation every year in the past 10?

2) Wine shops stack the wine on the floor and on the shelf.
Restaurants have to buy hundreds of glasses (of all kinds, cheap and
expensive) to serve the wine in, tablecloths, china, silver and other
accompaniments to a fine meal.

3) Wine shops sell you a bottle and you go home and drink it.
Restaurants provide you a place to sit down, enjoy dinner, drink wine
that is served to you in glassware that must be cleaned by a
dishwasher earning anything from $6-15 an hour.

4) Wine is marked up by everyone who touches it, from the broker to
the importer to the national supplier, to the local distributor, to
the wine shop or restaurateur. Why is the restaurateur the only one
who consistently gets beat up about the prices?

To be fair, there are some greedy people out there, but the costs
involved in stores and restaurants are totally different and require
different approaches. The general rule is that retail is cost X 1.5
and restaurants are cost X 2.5-3.5.

I hope this is clear.
Mark

Young wrote on Mon, 22 Sep 2008 11:50:17 -0230:

> Thank you Mark.

> and that $40.00 steak can be purchased for $10.00 at the
> butcher.

That's an irrelevant comparison since the restaurant has done nothing
significant to the wine but has cooked the steak.

--

James Silverton
Potomac, Maryland

Email, with obvious alterations: not.jim.silverton.at.verizon.not

On Sep 22, 12:18�am, Mark Slater > wrote:
> On Sep 21, 3:03 pm, Leo Bueno >
> wrote:
>
> > Please consider taking a look at the latest entry in the MiamiWine
> > blog,http://miamiwine.com/:
>
> > "Restaurants and Bars Jacked-Up Wine Prices: Ten Years of Data"
> > Excerpt: I don't mean to keep ragging on the hospitality industry, but
> > the data seems to indicate that restaurants and bars have in recent
> > years significantly increased wine prices far above not only the rate
> > of inflation but the price of wine we can pay at retail shops.
>
> > Thanks.
>
> > Leo
>
> Hello Leo,
> It seems that it has become my job in the last few years to explain
> the difference between retail and restaurant on the internet. Pardon
> me if I sound like a broken record, but, here goes:
>
> 1) Wine shops have 2- 10 employees. Restaurants have 20-150 employees.
> You mention the rate of inflation in relation to wine prices, but have
> you noticed that the cost of benefits, ie: health, medical, dental
> insurance has increased far faster and higher than the annual rate of
> inflation every year in the past 10?
>
> 2) Wine shops stack the wine on the floor and on the shelf.
> Restaurants have to buy hundreds of glasses (of all kinds, cheap and
> expensive) to serve the wine in, tablecloths, china, silver and other
> accompaniments to a fine meal.
>
> 3) Wine shops sell you a bottle and you go home and drink it.
> Restaurants provide you a place to sit down, enjoy dinner, drink wine
> that is served to you in glassware that must be cleaned by a
> dishwasher earning anything from $6-15 an hour.
>
> 4) Wine is marked up by everyone who touches it, from the broker to
> the importer to the national supplier, to the local distributor, to
> the wine shop or restaurateur. Why is the restaurateur the only one
> who consistently gets beat up about the prices?
>
> To be fair, there are some greedy people out there, but the costs
> involved in stores and restaurants are totally different and require
> different approaches. The general rule is that retail is cost X 1.5
> and restaurants are cost X 2.5-3.5.
>
> I hope this is clear.
> Mark

Remember, "retail" has already been marked up by a significant amount
so a bottle that "retails" for $20 cost the wine shop or restaurant
about $10 so there is already a significant mark-up from wholesale to
retail. As an investor in a moderately sized restaurant group that
was recently sold to Ruth's Chris I saw the financial statements that
showed cost of goods sold for wine at $1 million for the first six
months of 2008 and wines sales at $4.5 million. Not a bad return
regardless of the overhead involved. A bottle that they paid $4.00
for was sold for $7.00 per glass as a glass pour and $35 for the
bottle. They priced it this way to encourage glass pours getting at
least 5 pours from the bottle.

On Sun, 21 Sep 2008 21:18:54 -0700 (PDT), Mark Slater
> wrote:


>It seems that it has become my job in the last few years to explain
>the difference between retail and restaurant on the internet. Pardon
>me if I sound like a broken record, but, here goes:

Yeah, it sounds like a broken record. (Or corrupt MP3 file, for you
younger guys. LOL)

>To be fair, there are some greedy people out there, but the costs
>involved in stores and restaurants are totally different and require
>different approaches. The general rule is that retail is cost X 1.5
>and restaurants are cost X 2.5-3.5.
>
>I hope this is clear.

What's clear is that most restaurants have turned their wine lists
into horrendously overpriced systems for increasing their profit
margins.

I've seen Palazzo della Torre, a wine that retails for $13-$20, going
for $54 on a Seattle wine list. Last year I took friends in Memphis to
an old school Italian place they'd always wanted to try. Food was
okay, not great. A glass of house wine was eight bucks! We're talking
Memphis, not Seattle or New York. Falesco Vitiano was on the wine
list...at $45!!! It's $7.99 at Costco and ten bucks on any store
shelf. I know, because I just bought a bottle yesterday.

The exception that proves the rule: There's an outstanding little
Italian place in Bellevue, WA called Angelo's. Not only is the food
good, but the wine prices are so reasonable you think you're
hallucinating. Examples: Felsina Chianti Classico....for $30. That's
barely over what it costs at retail! Must be a misprint, right? Er,
well no. 2003 Palazzo della Torre for $29, 2001 Taurino Notarpanaro
$24 (grocery around $14+). And how about this: 2001 Banfi Brunello for
$61. Cripes, it's $53 at Costco!

When I complimented the owner profusely on his wine selections and the
reasonable prices, he responded emphatically, "I don't gouge people
over a bottle of wine." Sure, he concedes, he's always being told he
should charge more. (I wonder by whom.) He also concedes a price
correction will have to take place eventually due to the Euro/dollar
differential. But he's adamant that, vintage for vintage, he's not
paying any more for his wine now than before. "So, I'm not gonna gouge
people on the wine!"

A good five years ago, Marv Shanken, publisher of the Wine Spectator,
editorialized against the gouging. He correctly noted that overpricing
in restaurants is discouraging people from buying wine. I completely
agree. It's gotten to the point where I would rather bring my own
bottle and pay a high corkage fee than pay $40 or $50 for a
middle-of-the road bottle from a wine list.

I'd take it one step further. Whatever happened to the price of an
affordable glass of wine when you don't want to order a whole bottle?
Used to be you could get a decent glass for around $5 to $6. Now the
plonk is $7.50 - $10 (more than the price of the whole bottle in a
grocery), and you're lucky to get a 3-ounce pour.

JJ

"Bi!!" > wrote in message news:f26bfe99-ec83-4911-9ebc-

<snip>As an investor in a moderately sized restaurant group that
was recently sold to Ruth's Chris I saw the financial statements that
showed cost of goods sold for wine at $1 million for the first six
months of 2008 and wines sales at $4.5 million. Not a bad return
regardless of the overhead involved. A bottle that they paid $4.00
for was sold for $7.00 per glass as a glass pour and $35 for the
bottle. They priced it this way to encourage glass pours getting at
least 5 pours from the bottle.


Just confirming:
I assume you mean that you saw the financial statements of the restaurant
group that was sold to Ruth's.
Thanks.
Dee Dee

On Sep 23, 12:22�am, "Dee Randall" > wrote:
> "Bi!!" > wrote in message news:f26bfe99-ec83-4911-9ebc-
>
> <snip>As an investor in a moderately sized restaurant group that
> was recently sold to Ruth's Chris I saw the financial statements that
> showed cost of goods sold for wine at $1 million for the first six
> months of 2008 and wines sales at $4.5 million. �Not a bad return
> regardless of the overhead involved. �A bottle that they paid $4.00
> for was sold for $7.00 per glass as a glass pour and $35 for the
> bottle. �They priced it this way to encourage glass pours getting at
> least 5 pours from the bottle.
>
> Just confirming:
> I assume you mean that you saw the financial statements of the restaurant
> group that was sold to Ruth's.
> Thanks.
> Dee Dee

Yes.

On Sep 22, 12:29*pm, "Bi!!" > wrote:
> On Sep 22, 12:18 am, Mark Slater > wrote:
>
>
>
> > On Sep 21, 3:03 pm, Leo Bueno >
> > wrote:
>
> > > Please consider taking a look at the latest entry in the MiamiWine
> > > blog,http://miamiwine.com/:
>
> > > "Restaurants and Bars Jacked-Up Wine Prices: Ten Years of Data"
> > > Excerpt: I don't mean to keep ragging on the hospitality industry, but
> > > the data seems to indicate that restaurants and bars have in recent
> > > years significantly increased wine prices far above not only the rate
> > > of inflation but the price of wine we can pay at retail shops.
>
> > > Thanks.
>
> > > Leo
>
> > Hello Leo,
> > It seems that it has become my job in the last few years to explain
> > the difference between retail and restaurant on the internet. Pardon
> > me if I sound like a broken record, but, here goes:
>
> > 1) Wine shops have 2- 10 employees. Restaurants have 20-150 employees.
> > You mention the rate of inflation in relation to wine prices, but have
> > you noticed that the cost of benefits, ie: health, medical, dental
> > insurance has increased far faster and higher than the annual rate of
> > inflation every year in the past 10?
>
> > 2) Wine shops stack the wine on the floor and on the shelf.
> > Restaurants have to buy hundreds of glasses (of all kinds, cheap and
> > expensive) to serve the wine in, tablecloths, china, silver and other
> > accompaniments to a fine meal.
>
> > 3) Wine shops sell you a bottle and you go home and drink it.
> > Restaurants provide you a place to sit down, enjoy dinner, drink wine
> > that is served to you in glassware that must be cleaned by a
> > dishwasher earning anything from $6-15 an hour.
>
> > 4) Wine is marked up by everyone who touches it, from the broker to
> > the importer to the national supplier, to the local distributor, to
> > the wine shop or restaurateur. Why is the restaurateur the only one
> > who consistently gets beat up about the prices?
>
> > To be fair, there are some greedy people out there, but the costs
> > involved in stores and restaurants are totally different and require
> > different approaches. The general rule is that retail is cost X 1.5
> > and restaurants are cost X 2.5-3.5.
>
> > I hope this is clear.
> > Mark
>
> Remember, "retail" has already been marked up by a significant amount
> so a bottle that "retails" for $20 cost the wine shop or restaurant
> about $10 so there is already a significant mark-up from wholesale to
> retail. *As an investor in a moderately sized restaurant group that
> was recently sold to Ruth's Chris I saw the financial statements that
> showed cost of goods sold for wine at $1 million for the first six
> months of 2008 and wines sales at $4.5 million. *Not a bad return
> regardless of the overhead involved. *A bottle that they paid $4.00
> for was sold for $7.00 per glass as a glass pour and $35 for the
> bottle. *They priced it this way to encourage glass pours getting at
> least 5 pours from the bottle.

Years ago when I worked in retail wine, the standard markup was 1.5
times cost. I could never understand why the salesmen always had so
many bottles that were priced at $6.66 until I realized that on the
shelf they became $9.99.