Maybe restaurants will finally slash their exorbitant, ridiculous wine prices.:
Restaurant wine service is an eternally fraught subject. Conflicting opinions have even been slipped into the pages of Slate. Last January, I wrote an article praising American sommeliers; five months later, an indignant Christopher Hitchens demanded to know why such creatures even exist. In denouncing sommeliers, Hitchens hit on an essential point: Restaurants want you to drink as much wine as possible. Not only that: The more you spend on a bottle, the happier they are. They will sometimes even sacrifice a bit of the profit they might earn from solids in order to get clients to pony up for liquids. In a profile last year in The New Yorker, British chef Gordon Ramsay admitted that he kept food prices at his newly opened Manhattan restaurant lower than they needed to be as a way of enticing customers to go crazy on wine.
The emphasis on wine has a simple explanation: Wine sales are the lifeblood of many restaurants. Ronn Wiegand, a Napa, Calif.-based restaurant consultant who holds the rare Master of Wine degree, says that wine accounts for 10 percent to 15 percent of total sales for casual restaurants and as much as 60 percent at fancier establishments. Restaurants generally have low profit margins and thus need to slap markups on pretty much everything they put on the table. But a $250 Bordeaux is obviously going to make a far greater contribution to the bottom line than a turnip, which is why restaurants invest so heavily in their wine programs—not just filling their cellars with excellent rieslings and syrahs but also providing competent sommeliers, good stemware, excellent storage, and other amenities. For decades now, markups of 2.5 to three times the wholesale price have been the industry norm. According to Wiegand, such multiples are an economic necessity for most restaurants; anything less and they may have trouble sustaining themselves. But not every wine on the list has to be marked up at the same rate. So long as the average cost per bottle is in the 2.5-to-three-times-wholesale range, list prices for individual wines need not follow any formula. And, in fact, most restaurants that take wine seriously use a system of progressive markups: They generally slap the biggest markups on inexpensive wines and the lowest ones on pricy bottles (the idea being that the closer an expensive wine is to its retail price, the more apt the customer will be to bite).