In article >, Hunt > wrote:
>
[snip!]
>
>An aside, why do restaurants use a sliding scale of markup for wines (perhaps
>a gross over-generalization here) with less expensive wines being hit with
>MAJOR markups, and more expensive (at wholesale) wines seeing a much more
>equitable markup? Even in by-the-glass selections, it is not uncommon to have
>a glass of less-expensive wine priced at 200% of wholesale/btl for one glass!
>When I first came to AZ, a tony little wine bar in an upscale shopping area
>touted Lindeman's Bin 65(?) Chard, at US$25/glass. Heck, a btl was only US$4.
>99, and this was 7 years ago. I'd think that a constant markup of say 200%
>would work better, Some wine lists are starting to go with the +US$10/btl on
>retail, as their pricing. Most seem to be making the same profit and selling
>one heck of a lot more wine with their meals.


I assume this is because restaurants are looking to make a certain dollar
amount on each sale and not necessarily a percentage. Also playing into it
is simple supply and demand. Lots of people just want a glass of white wine
and it benefits the restaurant to charge a customary amount for that and yet
try to find a cheap bottle to pour. On the other end of the spectrum, luxury
bottles like Dom Perignon also usually see a high markup based on name
recognition. It seems to me that the middle of the list sees the best values. I
assume it is because these wines are less often ordered, as only more
knowledgeable wine drinkers will order them. Restaurants discount the
markup in order to make them more appealing. The couple celebrating an
anniversary is going to want the Dom. The occasional wine drinkers (which
are most of the clientele at an average restaurant) are going to want the
house wine. Only a knowledgeable wine drinker is going to see that
Sonoma-Cutrer is priced just $5/bottle over retail. (Sonoma-Cutrer is
often priced extremely well in my experiences.) That middle range of
$30-60 wines is often a sweet spot, and I will sometimes order wine off of
the list just based on what the markup is rather than trying to find the
'perfect wine' to complement my meal.


You are right, though, that I will see vintage Krug champagne for
something like $240 (retails $180) and Dom Perignon for $200 (retails for
$100 or less). The Krug is obviously the better buy in this case if one is
choosing between just these two. I suspect that lots of people don't know
Krug and won't shell out the extra cash for it, and that is why it is
'priced to sell' as opposed to marking it up to $350 to align with the
Dom.


Just my speculation...


Dimitri