Netscape Forum Poll: What's your restaurant markup limit?

[Robin Garr]

As discussed in Friday's <i>30 Second Wine Advisor</i>, most restaurants take a substantial profit on wine sales to help cover overall costs. How much of a markup are you prepared to pay before you just say no? Please take a moment to vote in our CompuServe/Netscape forum poll:

<b>Click here to vote

Don't do Netscape so here is my vote - anything more than 100% (double) and I'm drinking water.

Robin,
I think St Louis must have terrible mark ups because in general the wine is marked up more than 3 times cost. Take a wine you buy at a local wine store for $20. This costs the restaurant about $14, give or take. Two times is $28 and you will never find this in St. Louis. three times is $42 and this is possible but many times it will be higher. I find this also true in Virginia when dining with my parents. On the positive side you are beginning to see a few at 2-2 1/2 times but they are far and few between, just a small trend. I have no problem with 2 - 2 1/2 times. Maybe I should move to a more wine friendly town.
Wa;t

[Robin Garr]

Bill, you don't have to log in to Netscape in any way, shape or form or even register. You should be able to just click the linkie, vote and go on. {shrug}

[Robin Garr]

I think St Louis must have terrible mark ups because in general the wine is marked up more than 3 times cost. ... Maybe I should move to a more wine friendly town.

I think 3x to 4x is not at all out of line, Walt. I didn't include that line because I figured nobody would like it and would just vote "Whatever" or "Other."

We make this decision on an case by case basis at the time. It depends on a great many factors.

Is it a special occasion? Is it a business dinner with a client (and therefore write-offable)? What kind of restaurant is it? Do they have something we've been dying to try and haven't had a chance to? Are we in "vacation" mode? Did we suddenly come into some "found" money? Is it a routine weeknight dinner? Are we with people who will appreciate something really nice?

Etc. etc.

[Robin Garr]

We make this decision on an case by case basis at the time. It depends on a great many factors.

Granted, but I'm not sure that this rules out making a choice in the poll. I would guess that some level of markup strikes you as so outrageous that you wouldn't pay it under any circumstances.

Robin, I wasn't sure whether "whatever" meant "no limit" or something else, so voted "other".

As a practical matter, markups at a specific restaurant tend to be very similar unless the restaurant has made a mistake. We would never avoid trying an interesting restaurant because of wine markups, and we always have wine when dining out at better places.

Our approach is to limit the price of the wine we are buying, generally no more than two to four times the cost of the main entree, depending on whether we are two or four people. We tend to actually pay a larger markup because markups on more expensive wines tend to be lower on a percentage basis.

For us, eating at a fancy restaurant, once or twice a month, is a great adventure and worth the money it costs to enjoy the entire experience. We treat that experience very much like a trip to the theater or to a concert where we want great seats and are willing to pay more, and attend less shows, in order to enjoy the experience to the fullest extent possible.

There are so many dining [and entertainment] options, that it's no real sacrifice for us not to go to a particular restaurant or see a particular play or concert. But when we do decide to go, cost isn't much of a consideration -- we are paying an outrageous amount to see Springsteen Friday night -- but I don't much care how much the scalper made -- Springsteen makes Janet very very happy and he always gives a generous and wonderful concert.

Regards, Bob

I said Other.

There is probably a figure like that out there, Robin, but I don't have any idea what it might be. It's probably actually more a total cost decision than a markup point at which I re-think it.

Having many friends who own restaurants, we don't really obsess over this, as we don't obsess over the food cost per plate either. Sure, I can make many of the same dishes for a fraction of the price, but I choose to patronize an establishment and pay the tariff. The same with wine. {shrug}

I think 3x to 4x is not at all out of line, Walt. I didn't include that line because I figured nobody would like it and would just vote "Whatever" or "Other."

Hahahahahah......you are kidding, right? A 4X mark up is not out of line???

Glad I don't eat in your universe, Robin. They wouldn't get that sort of mark-up out of me - without force being applied...

Here, 2X is considered normal and anything more greedy. Many restaurants use a sliding mark-up as they'd never get the basic mark-up on higher end bottles. I think 3X is about as much as I've seen, and most wine fans avoid those places that use it.

"Having many friends who own restaurants, we don't really obsess over this, as we don't obsess over the food cost per plate either. Sure, I can make many of the same dishes for a fraction of the price, but I choose to patronize an establishment and pay the tariff. The same with wine. {shrug}"

You said it better than I did, Cynthia. Thanks. Bob

[Robin Garr]

Hahahahahah......you are kidding, right? A 4X mark up is not out of line???

Umm ... I think there may be a communication breakdown here, Bill. The question relates to markup over the restaurant's <i>cost</i>, not over <i>retail</i>.

4x cost is pretty typical. A wine that wholesales for $5 will retail for $10 and sell on a restaurant list for $20.

What is the intrinsic value of a bottle of wine? What is the intrinsic value of anything and how does one determine that value? It's as simple as sitting in the school cafeteria and staring longingly at your neighbor's Twinkie who notices and asks, "What's it worth to you?" I guess we all have to answer this question for ourselves in light of how we want to distribute our financial resources.

Maybe it's happening more. Maybe I'm just noticing it more. Or maybe I'm just getting cheaper as time goes on. I feel as if more and more people are trying to get rich quick and are more willing than ever to take others to the cleaners to do so. If I see a bottle of modest wine which I can get for $8.00 retail marked up to $32.00 and more in a restaurant, I won't buy it because I feel like I'm leading myself to the slaughter. I'm all for the biblical workman's being worth his wages, but I have my limits.

In the San Francisco Bay Area, 2.5x is a fairly standard industry convention among fine-dining restaurants, and many also accommodate people bringing in wines. Which gets abused sometimes, including by folks (you can see them boast about it online) who bring in a moderately-priced wine that's also on the restaurant's list, but that they could get down the street for a few dollars less. Effective "corkage" is a cooperation between restaurant and customer.

ALso, I could argue about the "substantial profit on wine sales to help cover overall costs." Wine cost (and its management costs) are part of a complex formula. Food cost also figures, as cited earlier in this thread, with comparable accounting markups; but people rarely complain about it compared to wine cost.

I hope no one gets the mistaken notion that of a 2.5 factor, 1.5 of it reflects profit to the business.

I quite honestly find myself at a loss as to how to respond to this type question. We don't really eat out a lot being retired either I cook on the Kamado or my wife does so in the kitchen. Even when neither wants to cook it is more than likely to be take out.

As to the amount of markup, the first thing is that my wife does not drink wine, and therefore I am pretty much stuck with a BTG offering. Very few places, if any, offer a half bottle, so I don't even ask anymore.

Now to the meat of the question. I think I am pretty much in the know of retail prices, and really think that anything more than 100% of retail is ripping the diner. And for damn sure the price of the bottle on the first glass in the BTG category is ripping the customer. So unless I am having something special, I just get a glass of iced tea and have wine the next night. That is sad too, for I would really much rather have a glass or two of something decent.