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Mark Up on Restaurant Wine


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Competion??????.....not really. Theres more than enough to go round, and yes he has done  a fantastic job on promoting the town.We have a nice friendly rivalry with all the quality restuarants in town..3 Stein's and 2 others.We all help each other out when we run out of stuff and i share one member of staff with the great man.sshhhhh. Only fly in the ointment is the guy who i had lined up to be my 2nd chef for this season. decided to stay where he was (for more ££££££) and didn't let me know. I had to ring him up on the day he was due to start , to find out! what a shit! PS this chef is not from Stein...Any other questions.....?????? :biggrin:

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There was a very good article in the Weekend FT "the business" magazine, March 2, on the very subject of restaurant mark-ups - though it doesn't go into great detail about wine mark-ups specifically, it does a good job of analysing both sides of the discussion.Sadly it is not available online but it is on p. 20, title is "Lean Pickings".

And while we're on the subject - I do recall going to the Garrick Hotel/Restaurant in Cornwall and being impressed with their wine mark-up policy, which is - or was at the time - to add a fixed mark-up to all wines, I may be getting this wrong but I seem to recall it was a few pounds for a wine under £x; and slightly more for wines over £x - i.e. £5 for wines over £20. The restaurant's goal was to enable people to try more expensive wines they might not otherwise be able to afford, by eliminating the straight percentage mark-up, but still make a modest profit. So I guess the restaurant was making its money on entrees, which of course require a lot more labour, talent, care etc. which is what a customer should be paying for - unless the place is a really high end wine-specialist where you are paying for the sommelier's time, expertise, energy, effort, etc. - and not just for someone to pull a cork for you.

To answer Cabrales's about good BYO places in London, in fact, the only BYO places I've ever come across are "ethnic" restaurants, for example the much lauded New Tayyab behind the Mosque on Kingsland Road...and a decent place in Chelsea Market, I think it was a steakhouse but the name escapes me. The Cook House in Putney used to be BYO and it was indeed *very* good. But no longer. Other than that, I believe there are none.  

One thing that I have been able to do - upon special advanced request (depends how often you go to a restaurant, how friendly you are with the powers that be) is to bring my own wine to a regular licensed restaurant, and still pay a corkage fee. This is obviously not very encouraged but for a special occasion, and for a wine that the restaurant does not stock, it's a less way of having your wine and drinking it too... be sure to offer a glass to the owner...

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Although I know a little about wine,when I go to a restaurant I generally don't know how much they've marked up any one particular bottle by.Instead I have my own rule of thumb which is about how much I'm prepared to pay in any particular establishment.

Generally I will not pay more than £20 for a bottle of wine in a restaurant.If I'm in a "high end" place I might consider going to £35-45,but generally no more. This is less to do with whether I can afford it or not(I've paid a lot more for some bottles I've got at home) and more to do with my own value systems.For me it is just "not right" to spend more on a bottle of wine in a restaurant.Whether the wine is "worth it" or not is not the point. Other people may spend hundreds or thousands-good for them.We all develop our own sense of values and priorities depending on our individual outlooks and we do what we feel is right for us.

I was gratified to see that two "high end" restautrants I've been to recently-Embassy and Rhodes in the Square-offering good choice in the £15-20 bracket and very good choice in the £20-£30 range. If a restaurant feels unable to offer a choice at this level it had better be offering something stupendous food wise in order for me to feel that I can bring myself to go there.

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Oh dear, there are some mighty serious people out there - opportunity costs, etc... Some of the correspondence wouldn’t look out of place in a A Level Economics paper.

I’ve spent the best part of a decade trying to get out of the wine trade (any offers please e-mail); the money is a joke, the benefits are worse & the hours are criminal, anyway that’s enough moaning.

In response to the prior correspondence & staying in the economics vernacular, restaurants will charge as much as they can for wine, not to mention water, etc. irrespective of rationality &/or morality. Arguments about justification on the grounds of service, ambience, the cellar, simply miss the point completely. Lets take wine stock argument:  cash tied -up in stock has to be paid for through mark-ups.  99% bullshit “ I’m afraid to say, only the top 1-2% of restaurants keep what could be remotely described as a cellar, & even then most of their stock will be held off premise & unpaid with their supplier/s. “Just in time” production isn’t just for auto manufactures! Furthermore, the vast majority of vino consumed -even at the top end of the restaurant spectrum-  is house wine that by definition goes no nearer the cellar than the desert.

In fact it’s even worse than that because not only does the restaurant operate a virtual cellar, it pays for it in a similarly ‘new economy’ fashion. You as the punter pay on the button; cash, cheque or credit card, the restaurant then has anywhere between a month to infinity to pay its supplier. So, instead to paying 300% plus mark-ups we should be paying less than retail prices! Especially as the trade price is at least 10% below the retail equivalent.

Another of a my petty gripes is the piss poor standard of wine knowledge amongst restaurant staff in this country.  Even or should that be especially at the top end of the spectrum, staff many of whom are paid to know what the hell their talking about, patently don’t. A friend who used to work in a senior wine capacity at Gleneagles Hotel, when it was a proper hotel not a bloody glorified timeshare country club, remarked that places for sommeliers competitions used to be over subscribed 3 or more to 1. This compares to a situation today where one was hard pushed to get a single member of staff to take part, even if paid time of & expenses are available.

My own experience of running trade tastings in Scotland certainly bares this out. It is nigh on impossible to get “genuine” representatives from the trade to attend these functions. The reason - in their respective domains these guys can wing it, they might know jack shit but that’s a whole lot more that anyone else in their respective hotel/restaurant. Ignorant they may be,  stupid they most certainly are not. The last thing their going to do is expose themselves “in public”. Those of their fraternity that exhibit a micron of knowledge above the norm can expect to be wined & dined in a spectacular fashion by eager suppliers

(the slickest operators by far are the Champagne houses who also have the deepest pockets!) with much ego stroking & general arse licking the order of the day. They will then be asked to “consult” on wine lists, cellar selection, etc.... The dashing David Harvey, formerly of No.1 at the Balmoral, Edinburgh is a wonderful example of this phenomena - from humdrum sommelier to all singing, all dancing wine guru in 5 short years. Alternatively, step into any branch of Oddbins & talk to just about any member of staff whose been with the company for more that 2 years & you’ll find someone who definitely does know what their taking about. Sadly for them this knowledge doesn't translate into anything more than minimum wage rates & a non-existent career path & no I don’t work for the buggers, not anymore thank Christ.

Well, that’s way more bile than I originally intended to spill! I shall continue at a later date on similar vein: cretinous wine critics; vanity wine operations; under brained & overpaid tossers in the wine trade, etc.... Thank you for your indulgence.

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Martin - very interesting and entertaining post. The discussion up to this point has been centred on the restaurant/customer relationship and we had overlooked the wine merchants role. Can you tell us a little more about what you do, just to put things in perspective?

I had dinner with a friend at The Merchant House in Ludlow a little while back and we were talking to Shaun Hill about the wines on his list. It was mentioned that the Mirabelle was selling a Zind Humbrecht I think it was for 3 times the rate that Shaun was. His response was simply "Well, it's not worth that".  A refreshingly honest approach to business I thought.

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