Opinion: Marking up

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Drinks: Wines

The first few months of the year are traditionally the time for a bit of judicious belt-tightening. And no surprise that, as people trim back their expenditure and our economy rolls over and goes back to sleep, the venting of spleen should be particularly enthusiastic: bankers, gas suppliers, MPs… they’ve all been fair game.

But so, too, is the on-trade. I’ve had a few sommeliers call me up in varying states of fury and dismay over the last few weeks to point out an article pointing the finger at restaurant wine mark-ups that appeared in Decanter. While at Vinexpo’s annual ‘state of the wine market’ (also in January), the show’s chief executive, Robert Beynat, waded into the debate, commenting that he thought mark-ups in the UK were too high.

Leaving aside the fact that the chief of a Bordeaux-based trade fair is unlikely to be au fait with rental costs in the UK, I still think you can argue that one comment could be dismissed as misfortune, but two looks like something altogether more significant. Is there, perhaps, a groundswell of feeling that restaurants are ripping people off with their wine offering?

Now, I accept totally that restaurants need to make a certain amount of money, and that if it doesn’t come from the wine list, it’ll have to come from somewhere else; that just saying ‘charge less for wine’ would see burners being turned off all over the country. I can understand, too, why restaurants might feel, as one chef/patron put it, ‘disappointed that the country’s main wine magazine is trying to paint restaurants as the bad guy.’

And yet Tom Cannavan’s piece in Decanter struck me as being fair and well-balanced – albeit from the somewhat rarefied perspective of your average Decanter reader. He made, essentially, three main points: i) that most serious wine lovers object to paying upwards of £200 for something that they might have bought for their own cellar at £50; ii) that more restaurants are permitting BYO, and iii) that this BYO renaissance could ‘change wine’s place in fine dining permanently’.

Dealing with the latter two points first, I’m not entirely sure that there is a BYO renaissance. Yes, a few restaurants have signed up for the BYO Wine Club, but since it costs punters £99 up front to take part I’m not sure that it’s exactly going to transform eating out habits. Nor do I think that restaurants will still want to sign up for it once our etiolated economy regains some colour.

As for defending the rights of customers to pay less money for wine in restaurants – such sybaritic egalitarianism would have had rather more resonance had it not been written in favour of the top 1% of wine drinkers.  I think you could pretty squarely put a case for saying that diners who have cellars full of £50 bottles of cru classé are the very people who can afford to pay more for wine when they eat out; that if they want to drive a five-series BMW and take three holidays a year then drink house wine when they eat out in protest at wine mark-ups then, frankly, they might want to rethink their priorities.

Does a German car manufacturer/ French villa owner really have a more compelling moral case for receiving your hard-earned than the struggling restaurateur on the corner?

Having said all that, I think the on-trade’s attitude to pricing does, as the Decanter article suggests, need some serious thought. It doesn’t hurt to revisit the pricing of some of the trophy wines on your list if they’ve been sitting there a while. As Thierry Tomasin at Angelus once put it ‘I would rather have a good cash margin in the bank than sell nothing at 70% GP.’ Top-end restaurants in the City who have intermittently knocked 30% off the price of their Supertuscans have seen take-up rise hugely. 

But more significant than such top-end fiddling, I think, is the industry’s attitude to BYO. A couple of issues ago in Imbibe, sommelier Mark Deamer wrote a piece for us on this subject. Some restaurants were openly hostile to it, most were grudgingly accepting of it if backed into a corner, viewing it much as they might tax returns and root canal surgery – as a necessary evil. 

Pretty much none were positive about it. In fact, the fact that someone has felt the the need to set up a BYO scheme that costs people money to sign up for it, when the on-trade could have introduced such a de facto option for nothing, is a fairly damning indictment of the industry’s attitude in this area.

While the on-trade likes to use the ‘margins and overheads’ argument to justify its hostility, I suspect it’s as much to do with bruised ego: restaurants simply hate the idea that customers don’t want to order off their lovingly-constructed list. They see people rolling up with bottles of their own as an affront to their dignity, a slight on their professional abilities.

If everything is going swimmingly, then I can understand this. But survey after survey – and, indeed, the feedback from our readers – tells us that restaurants are finding it tough at the moment. No surprise there, given that we’re heading for a double-dip recession.  But this, in other words, is a time for pride-swallowing pragmatism, not prickly sensitivity.  

Far from dismissing BYO it should be high on the list of promotional options for any restaurant that’s not selling out every sitting.

At the lower level, it offers a chance for diners to shave a few pounds off their bill, and feel like they’re getting a deal, while the restaurant can still make decent money for zero investment from customers who wouldn’t be there otherwise.

This may have limited appeal on a Friday night, but why not actively promote Tuesday night, say, as BYO night? If nothing else, it would send a strong signal to the public that you’re ‘on their side’ in the battle against poverty; that you understand their financial pain and are trying to work with them to make it bearable.

Restaurants might not like being under attack for their pricing, but their stubbornness in this area means they only have themselves to blame. A more enlightened attitude to pricing generally, and BYO in particular would silence at a stroke anyone looking to take a pop at ‘rip-off restaurants’.

About Author

Chris Losh

After five years working on My Weekly magazine (during which time he learned how to write horoscopes and make things out of mince) in 1995 Chris Losh entered the world of drinks writing and, despite all advice from his doctor – and the wishes of most South African winemakers – has stayed there ever since. He began on Wine and Spirit International, editing it for several years before moving on to edit Wine Magazine. Both publications have since gone the way of the Dodo, but he claims to have nothing to do with their demise, and his alibi appears solid, since he was freelance writing for anyone who would pay him at the time. In 2007, he helped to set up both Imbibe magazine and the Sommelier Wine Awards, and has spent much of the last three years eating, drinking, and listening to French sommeliers talk about minerality. In 2009 he was shortlisted for the Louis Roederer Feature Writer of the Year, but didn’t win. Perhaps he should have stuck to horoscopes. And mince.

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