There Oughta Be a Law! (Take 2)

I’ve never been to The Federalist in Boston, but I’ve always wanted to go. According to an article in the latest issue of QRW (Winter 2005/2006, p 13), The Federalist has a unique and amazing selection of wines; however, many people seem to balk at the wine list prices. The restaurant’s general manager, William "Chip" Sander, defends their high prices by stating, "What’s forgotten in all this is that no serious restaurant can survive just on fine food. Preparing it costs a lot of money. Great food comes to them from sales of wine and spirits."

I hate this excuse.

Chip is admitting that wine prices are jacked up in order to cover the costs of preparing food, and that all serious restaurants must do this to survive. But here’s my question: Why must we, the wine drinkers, subsidize other customers who merely eat and not drink? If I have to pay $100 for a bottle of wine that cost the restaurant $25, then the guy at the next table who drinks only water and orders a $25 tuna steak should pay $100 for it too. Why am I paying more for my wine so he can have a better meal?

Surely a restaurant won’t last too long if they start charging $100 for entrees. But it doesn’t seem fair that wine drinkers have to support the restaurant’s overhead. Why not mark up the food a bit more, mark down the wines a bit more, and even it out? Charge more for food and less for wine. Maintain a standard profit margin across the menu, whether it’s for food or drink. There’s far less work involved in opening a bottle of cabernet than in creating a dish of Beef Wellington, so why put a higher markup on the item that’s actually easier for the restaurant to prepare?

Chip’s statement also irritates me because it implies that inflated wine prices equal great food. Well I’ve been to a number of restaurants with expensive wine lists, and the food has often been average at best. I’ve also been to a few restaurants with modestly priced wine lists, and the food has been outstanding. For example: New York City’s Landmarc (and no, I don’t secretly work for them, even though I rave about them all the time). Their wine markups are extremely low – probably not much higher than their markups on food. But the restaurant does extraordinary business, the meals are excellent, and I’m sure that chef owner Marc Murphy is surviving quite well, despite the fact that he isn’t gouging people on wine prices to cover his food costs.

I'm done venting, yet again, on this topic.  Thanks for hearing me out.

Comments

[jens at cincinnati wine warehouse]

I concur but is anyone (any restaurants) listening? I have seen a few restaurants offer 50% off on wines on certain nights to drum up business, so that is a start.

jens at cincinnati wine

[Lenn]

That argument is bs. I've been to several great restaurants (both here on LI and also in Philly) that were BYO! How is that they are surviving without the wine/spirits markup?

Markup on wines by the glass p*sses me off even more. When I see a GLASS of wine on a list that cost what an entire bottle does (or more) retail, it drives me not drink at that restaurant.

I've seen a glass of [yellowtail] listed for $8. Are you kidding me?!?!?

[WineGoddess]

Good point, Lenn. I hadn't even thought of the BYO spots. I guess Chip wouldn't consider them "serious" restaurants.

Jens - Absolute cheers to those places that offer 50% off nights. It's just too bad that they're usually on Sundays and Mondays when I've already had my weekend wine fill!

[Rod Schiffman]

Boston, and Philly too, have some of the highest wine prices I've seen. They also each have idiosyncratic restaurant wine laws that encourage this type of crap.

Go to SFO. There are some top restaurants that try to get away with assuming everyone is on expense account and either doesn't know or doesn't care. However, there are a lot of truly great restaurants with great lists for excellent prices. That includes older vintages. I have no problem with restaurants charging higher prices on older vintages (that whole cost of money thing), but that does not mean that a bottle they paid $35 for in 98 should be going for $350 today either.

I can handle 300% markup over wholesale for cheaper wines, but to charge $400 for a bottle of current vintage Opus I could go and buy the same day for $150 is nuts. When I was in Boston, I specifically avoided the Federatlist specifically because of the wine list prices. I ended up spending my $1000 on food over the week at places with more reasonable wine prices and good food. I don't regret it for a second.

Unfortunately in MA you can't BYOB in a restaurant with a license and it's hard to find a place with really good food that doesn't have a license. I spent the last 6 months in Philly for most of my working days. There was a lot of way overpriced lists, but you could BYOB for a reasonable corkage in some really nice places if you asked.

[caveman]

Hold on folks,
Let me speak for the resto owners here.

Running a business costs. Holding inventory costs. Electricity costs. blah, blah, blah. It all costs. Sure some places are rolling in the dough but the majority of these people are making a bit of cash, working hard and not seeing alot of anything but their place night after night. Obviously, if your margins aren't right on your food, and you are hoping to make up the difference by gouging on the wine, then you deserve to go broke and feel the wrath of Beau at the same time. But for most of us it is another profit center, and an important one at that.

My rule is be fair. But when i go out for dinner, I expect that the bottles will be double the price. Sucks, but that is what it is.

What is the solution... become a great cook and spend the $50 that you would have spent on the $22 bottle on a real $50 bottle.

Caveman

[beau]

Billy Z - You'll be feeling the wrath of le WineGoddess. Personally, when I go out to dinner, I don't mind markups up to 2.5x of retail on most wines. For high end bottles (over $100), I usually don't go there. But if the markup is 3x or more, I definitely don't dig it.

I realize that in a resto I'm paying for more than just food & wine, I'm paying for ambience, creatively prepared food, someone else to clean up after me, etc.

I think the point here is that outright gouging isn't going to encourage many diners to purchase wine/more wine.

[WineGoddess]

It sucks Bill, but WHY is it what it is? How did the brilliant idea of marking up wines so outrageously, more than anything else on the menu, begin? (indeed it was brilliant – for restaurant owners – because the idea has stuck around and has sadly been accepted by most of the dining public) Is it because drinking wine in a restaurant is supposed to be a luxury or premium opportunity? Just looking for the rationale that makes it okay.

And sure, most of us reading this right now know when we’re getting robbed and can just avoid the restaurants that do it. But sadly, the average person doesn’t realize when it’s happening. The number of people who come into the shop looking for that great bottle of wine they paid $75 for at dinner last night, and then see that it’s only $25 on the shelf, is staggering.

[CaVeManBiLl]

WG and Beau
I agree that triple markups are way outta line. Double or 2.13 is for me is fair. But the reality is that food cost should be only 30%, so the markup on food is in fact higher than that on bottles.

One thing that makes the whole markup thing more palettable for me is if the resto owner has put some thought into the list. What pisses me off even more than the mark up is when I can't find anything that I want to drink. My lists are labours of love and I try and offer so many interesting bottles that the choice is difficult because there are in fact so many options.

And the idea that less markup increases consumption is a fallacy. People spend what they are comfortable spending in terms of bottle price. As a resto owner, the question is, do I want to make 10-20 or 30 dollars on that $50 wine. The one thing that less markup offers the resto owner is that the client can get a better bottle for $50 and theoretically has a better dining experience because the wine was better.

Love ya all
Bill