The Imbibe Debate: Sole Supply

Drinks: Drinks

Is sole supply an example of business pragmatism or unimaginative laziness? Natasha Hughes referees, as two UK wine merchants get into the ring to debate the power of one

Willie Lebus, director, Bibendum Wine

It’s fine to be critical about venues having sole-supply contracts, but what a lot of people fail to grasp is that opening up a restaurant is fraught with financial challenges. Well over 90% of restaurants opening in any given year fail to last 12 months. That’s the time that sole-supply contracts tend to come into their own – particularly in restaurants where there aren’t any specialist wine buyers. In many cases you have an owner-operator, who may or may not be cooking the food, but is lacking in wine knowledge. They need to work out how it’s going to be served in their restaurant, and one option open to them is to have a sole supplier.

It’s normal, in sommelier-led environments, to have more than one supplier – but that’s not always the case. It’s rare that a sommelier is also an expert in fiscal matters, so it’s a good idea to have someone keeping an eye on the finances. And a restaurateur who wants to keep everything tightly controlled may instruct a sommelier to buy from one merchant.

Very few restaurants with a sole-supply deal are all that radical in terms of what they’re trying to do, they’ll want a prescriptive list with, for instance, an entry-level Chilean Merlot, a New Zealand Sauvignon Blanc and a Rioja. If you’re doing that, you’re looking for the best financial deal, and while some people think that when the initial deal’s done, that’s it, others get quotes for the business once a year. That keeps the incumbent exceptionally honest as the best way to get the business is to drive your prices down. We’re not going to send the owner out on a holiday to Florida or pay for fridges though: that’s a greasy pole.

If all you’re offering to the customer is lower prices, you’re never going to have a good relationship, and the working relationship is what this business is all about. Where Bibendum acts as a sole supplier – which is around 10% of our business – it’s about a partnership. It’s about offering the best price possible and a consultancy service that deals with the suitability of the wines, the organisation of the menu, the pricing and staff training.

A sole supply relationship is like a marriage. If we don’t take an interest in what our clients want to do with their list and their business, it will all end in tears.
I just don’t think sole supply is a dark arts scenario. The wine business has never been more transparent, or more competitive. There’s no point in us pulling the wool over our clients’ eyes because it will come back to bite us.

Doug Wregg, sales director, Les Caves de Pyrène

I think that in many cases sole-supplier contracts smack of the triumph of convenience over quality, not to mention the gradual erosion of choice at restaurants that could and should offer more to their customers. These contracts are symptomatic of the rise of the food and beverage manager over the sommelier: one favours clarity, simplicity and margin, while the other values – or should value – quality and choice. To tie down a restaurant with a sommelier or wine buyer to a sole-supplier contract is to turn him or her into a glorified bottle opener.

In many cases, the rationale behind sole supply is the creation of a price-driven list, and in order to get the biggest margins, restaurants tend to award contracts to the merchant that offers them the best deal. The upshot is usually a list without imagination: often they’re full of branded wines because the brands can support this kind of activity. As a result, if you look at a typical sole-supply list, then they all tend to be made up of the same wines, regardless of the restaurant.

Having said that, I’m not totally against the idea of sole-supplier contracts. If you’re running a pub with a 20-wine list, it doesn’t make a huge amount of sense to have four or five suppliers. Nevertheless, you don’t have to have a huge list to have a diverse one – all you have to do is look at restaurants with aspirational small lists, such as Granger & Co or Ducksoup, to see that it’s possible to manage.

One of the key arguments often advanced in favour of sole-supplier contracts is that the restaurant benefits from staff training, but I always thought that training was – in part at least – the responsibility of the wine merchant anyway, without having to tie anyone into an exclusive contract.

 I like to think we walk the walk as well as talk the talk. When Terroirs first opened, then Brawn and Soif (Les Caves de Pyrène is a partner in all three restaurants), we decided that around 15% of the wines on each of the lists should come from merchants other than ourselves, particularly those with an emphasis on natural and biodynamic wines – though we could more easily have supplied all the wines ourselves. Our managers are free to go out and find wines that they genuinely like and then add them to their lists. I think that giving them the freedom to do this has encouraged self-sufficiency, and allowed each restaurant to create their own distinctive wine list.

Want to add your thoughts to the debate? Email [email protected] to have your say

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