restaurants vastly inflated pricing structure.........

[cecinadan]

just been out for dinner and as i have been developing a bit more of a wine awareness i have come to realise just how much the mark up on the wine is! it's pretty outrageous or is this just me. looking at the wine list it seemed to be about approx a 75% mark up. i am slowly coming round to the fact that BYO (which i sort of used to look down on) may not be such a bad thing! either that or stay at home and buy better wine. maybe we should be blaming greedy gordon brown for this!


Good wine needs no push, and perhaps products that people really want need no hard-sell or soft-sell TV push. Why not? Look at pot.
www.nosewine.com

[Innkeeper]

Just 75%!!! Don't know if you have a wholesale/retail differential there in jolly ole, but that would be a great deal here in the states. Even on this board we recommend a 100% markup over wholesale or a fixed markup over retail. Some of our folks report 300% over RETAIL as commonplace in many restaurants here. I wish we lived in England!

[TheEngineer]

yup...three times RETAIL is the norm here in Boston....which means that it really is closer to 3.5 to 4 times due to purchase from wholesales.

[winoweenie]

Here in Phoenix we feel if a restaurant is only charging 2x retail it's a bargain. WW

[barnesy]

Another reason why I drink beer when I'm out and Wine when I'm at home.

Barnesy

[as2324]

Is it really so inflated??? I don't own a restaurant, but I do own a retail business. I would assume that restaurants (like any other business) are in business to make money. Do you really think the steak you're eating with that bottle of wine cost the restaurant $30? Of course not, the restaurant needs to make money on the wine as much as anything else. They have costs... storing the wine, stems for the wine, and so on. You can just as easily walk into any supermarket and buy a $30 steak (restaurant price) for $10.

[Innkeeper]

Hi As and welcome to the Wine Board. The COGs for food is much higher in restaurants than COGs for wine. This is based on broad experience. Most restaurants are happy to simply double COGs when pricing food, and that all we would like to see them do when pricing wine.

[Kcwhippet]

Way oversimplified there as2324. Of course no one should expect to pay supermarket prices for a steak in a restaurant. For the food you get in a restaurant you're paying an amortized part of the cost of equipping a full kitchen, buying all the meats, the seafood, the vegetables, the fresh herbs, the spices as well as the salaries of the chef and all his (or her) minions. For the wine, the restaurant pays for a (usually) small room to store the wine, generally inexpensive stemware and for the wholesale cost of the wine. In a "fancy" restaurant you can include the salary of a sommelier or wine steward, which isn't all that high - trust me on that. So, how do you justify a run-of-the-mill, nothing special restaurant charging $27 for a bottle of Kendall-Jackson Vintmers Reserve Chardonnay that they bought for about $5? So, you're are definitely correct that the restaurants are in business to make money, but the prices charged don't justify the costs to the restaurant. However, what possible costs could the restaurant have incurred, plus their profit, for charging $22 over their cost for the wine? BTW, if I could walk into a supermarket and purchase a $10 steak for $30 and get all I'm getting in a restaurant, I would gladly pay it. The extra $20 would get me a trained chef to prepare the steak as well as all the sides and the service, but it won't happen.

[wineguruchgo]

KC - In addition you have to add rent/mortgage on location, utilities (which ain't cheap), valet if it's free, tax at time of purchase as well as quarterly taxes by government.

If you think it's cheap opening a restaurant, think again.

My Brother-In-Law owns a few and let me tell you...they ain't rich.

One of the wealthiest men I know owns a bunch of Kentucky Fried Chicken Franchises.