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Wine Mark Up

What do you consider to be an acceptable mark up for wine at restaurants? I know it can range wildly but I am curious at which point the mark up percentage goes from acceptable to theft. Is there a general rule of thumb that someone can suggest? Thanks.

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  1. Depends on the bottle really. For instance, I see crappy Kendall-Jackson on some yuppified steakhouse menus at darn near $30. I could buy the same bottle for $10 at my local liquor store... that's what I consider theft. Now if we're talking a '96 Chateau Margaux, that's a different story!

    1. Well, it used to be that standard markup was 100-200%. Now 250% is considered very common, with 200% at the low end of standard and 300% at the high end. Lower cost bottles are usually marked up more.

      In the end, what's fair is what you are willing to pay.

      When I see a wine list that is marked up too much for my taste, I sometimes order a glass of tawny port and sip it through the meal. It's usually the best value on the glass list, especially since you don't gulp it down anyway.

      Btw, one can do what many people in other countries do and water down your wine. Shock! Horrors! How uncouth! (But, it *is* "authentic"...)

      6 Replies
      1. re: Karl S

        I think if you're talking markup, you have to factor in that the restaurant is paying wholesale. So while the price looks like a 250%-300% markup on retail--it's actually a much higher percentage. So that crappy $30 Kendall-Jackson probably cost the restaurant $5-$7 bucks, tops.
        Markups are much lower on bigger ticket bottles, because no one will pay that percentage on a $100 (wholesale) bottle. It's what the market will bear, basically.
        In NYC, there's a little trend toward lower markups. The reason? Restaurants found that they generated good will, bumped up covers, plus, tables would order multiple bottles. They actually earned MORE profit in the end with less extortionate markups. Of course, this is in NYC, where you can get stinko and not have to drive home.

        1. re: nrxchef

          Yes, 3x wholesale will probably be 2x retail.

          1. re: nrxchef

            That may be dependent upon state laws, though. In PA restaurants do not receive a discount on wine; prices are set through state stores. The same is true in parts or all of MD. I would guess that some other states have similar laws, but they may be in the minority.

            1. re: nc213

              Of course, thanks for mentioning it -- I should have said depending on the state. In New York State, wines are seriously discounted for restaurants. Big buyers get even lower discounts, as the prices aren't particularly regulated.
              So I wonder if markups are lower in PA and MD, since the prices are regulated. OR are the retail prices lower to begin with?

              1. re: nrxchef

                In my experience the markups tend to be the same. 250-300% for inexpensive wines. Markups decrease as retail prices get higher (as others have said). To complicate (or simplify) matters, liquor licenses are expensive and limited in PA, so there are lots and lots of byob places. I miss boybs!

                In PA, the prices of wine and liquor are actually often higher than other places (like NJ right across the bridge) b/c there is no competition. The State of Penn buys all of the alcohol for the state and then sells it at state stores. It's an absurd system for many, many reasons. I've lived in MD for three years and I still don't understand how the system works. Prices seem high. though you can actually buy 6-packs of beer at delis, so that's cheaper than PA.

          2. re: Karl S

            I used to wonder sometimes if that(water down) wasn't done when a carafe of house wine came to the table. Can you still order by the carafe? Haven't seen that in a while on a menu/wine list.

          3. There's an excellent restaurant here in San Antonio, Bin555 that has 55 wines for $55. They are all bottles that retail for $35-40, so the mark-up is nothing.

            Franciscan Magnificat, Treana red meritage, Veuve Cliquot....

            Apparently the attitude of the owner is that he would rather sell more wine and let everyone have an enjoyable time. I wish more places would do this, in the meantime I'm working my way through the list!

            1. The current rule of thumb for most places is three times what they paid the distributor. So a lot of $10 bottles are $30.
              Less for more expensive bottles. Your food bill might be less than it needs to be when the place does a good business in
              wine. Theft? As long as the price is stated and you order it,
              it is never theft. The cost of keeping the doors open, the cost of complying with myriad local, state and federal regulations, the insurance, the relentless overhead---and the fact restaurants have the highest failure rate of any business tells you that it is not any easy thing to stay open. Smart restaurants carry bottles you can't find yourself, which can spare you that agony when you realize the bottle you just paid $50 for was on the shelf at Costco for $15. Let it go.

              7 Replies
              1. re: itsonlyfood

                Same overhead & ancillary expenses, even maybe higher, apply overseas, however restaurat markups are minimal compared to US. Case in mind: Italy. High end restaurant prices are never more than 25% on top of retail.

                1. re: RicRios

                  that's false. wine prices in 2- and 3-star michelin restaurants are comparable to similar u.s. restaurants. liquor licenses in europe cost pennies, and they don't have to pay employee health insurance premiums... among many other things.

                  1. re: hotoynoodle

                    I clearly remember paying at Pierre Gagnaire(3 star Michelin) in Paris 120 Euro (back when 1 Euro = 0.85 U$S ...) for a 1996 Chateau Rayas Chateauneuf du Pape that was retailing at the time in the US for close to $100. That same year I had that same bottle at Spago in Beverly Hills for U$S 250. This one I remember clearly, since that was the year I "discovered" Rayas, but by no means is the only example.

                    1. re: RicRios

                      i can only speak for the boston and nyc markets, and my last experience in france (with a more recent conversion for the euro -- more like 1 euro=$1.35) but i felt the mark-ups were similar.

                      and again, as i mentioned below, comparing retail and wholesale prices is a flawed equation. stores can get deals like mix and match and large case drops that restaurants simply do not.

                      if you feel the wine is over-priced, the answer is simple -- don't buy it.

                      1. re: hotoynoodle

                        And I don't.
                        For the last several years I've been BYOBing every time I go to a restaurant.

                        1. re: RicRios

                          And this is why restaurants can't survive. Everyone feels there is a conspiracy, when all they are trying to accomplish is stay open. Restaurants make 10% profit on average. That's 50,000 bucks annually on 500,000 in sales. With all the maintenance issues that come up, that quickly dwindles away to nothing. With consumer attitudes the way they are, we'll all be eating at T.G.I. McChili-Bee's very soon.

                          1. re: hollandshield

                            There are some restaurants that for one reason or another, have lower markups than other restaurants. Some places sell wine at the range of retail prices (iirc Plumpjack in SF for instance - they happen to have a wine store as well). Places like this are not common, but it's not something that the combined efforts of chowhound can't uncover.

              2. it's unrealistic to compare store prices to restaurant prices. a behemoth like costco negotiates a price based on purchasing 100s, if not 1000s, of cases of something. even a decent-size liquor mart will buy in 25 or 50 case drops for wines they move at great volume.

                no restaurant has the storage space for that, and it's often hard to fit a 5-case drop, even if you can get a better price.

                laws, taxes and distribution are different in every state, so prices vary wildly across the country.

                the profit from wine and liquor is what keeps most restaurants afloat. nobody is trying to "steal" your money. but the bottom line is the bottom line. any decent place will have some little undiscovered gems reasonably priced. try something new, maybe?