By Ryan Yousefi
By Chuck Strouse
By Terrence McCoy
By Terrence McCoy
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By Michael E. Miller
By Kyle Munzenrieder
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Chip Cassidy, wine director of Crown Wine Merchants and possibly the foremost wine retailer in the Southeast, tilts back in his favorite chair at his favorite table in his favorite restaurant. He raises his glass of 1990 Domaine Trimbach Riesling Cuvee Frederic Emile and swirls it gently, then lets his nose hover over the pale-honey liquid, allowing that most sensitive and assiduously trained organ to sniff out the wine's multifarious components: flowers, herbs, citrus, apple. "I love Alsatian wines," Cassidy proclaims finally. "They go so well with so many different kinds of food. And yet you never see enough of them on wine lists."
Sure enough, Cassidy didn't order this Alsace Riesling off the wine list. He brought it with him. Almost without fail, he brings his own wine when he eats out, preferring to pay a "corkage fee" rather than acquiesce to the marked-up rates -- commonly more than three times a wine's wholesale cost -- most restaurants routinely charge.
A painstaking (though by no means exhaustive) computer-assisted examination of the wine lists at nearly two dozen local restaurants reveals that patrons are asked to pay wildly varying amounts for the privilege of accompanying their meals with wine. For example, the same bottle of chardonnay from Kendall-Jackson -- the best-selling label at restaurants across the nation, according to a recent survey by Wine & Spirits magazine -- might cost anywhere from $20 to $33, depending where you happen to make your reservation. The wine retails for about ten dollars. A bottle of Santa Margherita pinot grigio, an increasingly popular Italian white, costs $14 to $17 at the grocery or liquor store but appears on local lists for $29 to $40. Champagne pricing is equally unpredictable, and the stakes can be far higher: A bottle of vintage Dom Perignon that retails for less than $90 can cost as little as $110 at a restaurant A or as much as $190; a bottle of Louis Roederer Cristal ($120 retail) ranges from $150 to $265 if someone else pops the cork for you.
When asked to justify seemingly extravagant markups, restaurateurs don't get defensive, they get righteous, toeing an unwavering party line. "We're pretty much in line with other restaurants of our caliber, in Miami and around the nation," says Tom Hillan, general manager of Mark's Place in North Miami. Hillan, who is in charge of wines at all three of owner Mark Militello's restaurants, argues that luxe restaurants such as Militello's use wine pricing to offset high overhead and labor-intensive menu items, which eat away at profit margins. The restaurant is careful, he adds, to offer interesting wines for which their clientele won't mind paying a premium. "We try to put things on that are eclectic -- smaller producers, boutique-type wines. Not grocery-store wines."
Rick Garced, manager and wine director at the Grand Bay Hotel's Grand Cafe, agrees. "To maintain a high-end restaurant, there's a lot of hidden costs," asserts Garced, who worked as a maitre d' at the renowned Manhattan food-and-wine spot Windows on the World, then helped to reopen the Beverly Hills Hotel's Polo Lounge last summer before moving on to the Grand in January. "We're very price-conscious, but you have to adjust it when you're running a place at this level. We offer a lot of hard-to-get wines, unique wines. Our prices are competitive with our competition."
Chip Cassidy, who has been in the retail wine business for 26 years, takes pains not to single out any restaurant owners, but he does have one well-chosen word for the theory that wine markups must be mighty: "Baloney. Those restaurant owners are not consumers. They don't buy wine. They're only interested in what their accountants told them about food costs. And accountants have told them they can get away with it."
Wine writer Frank Prial agrees. "They're trying to make up a whole lot on the backs of wine drinkers," says Prial, whose column appears in the New York Times every Wednesday. "It's almost discrimination A it's outrageous. They usually whine to me about rent. 'We have to make it up somehow,' they say. I say, So what? That's just another excuse. It's an easy way out for them, but it's still a rip-off."
Among the restaurants New Times surveyed, there were a few exceptions to the high-price rule. For every ten restaurants that marked up their wines 300 percent or more, there was one that seemed to be adhering to much less excessive guidelines.
Most eye-catching, perhaps, was the Captain's Tavern, which would be a meat-and-potatoes establishment if it served meat and potatoes. But Bill Bowers's South Dixie Highway mainstay, which celebrates its 25th anniversary this month, specializes in seafood. And an amazing array of wine, a huge list that is marked up to twice the wholesale cost at most and one that seems out of character in comparison to its surroundings. ("I don't build fancy pyramids out of food," Bowers confirms. "I have good food, big portions.")
Bowers believes something is lost when restaurant owners view wine solely as a commodity to ensure a robust bottom line. Wine, he feels, should be part of a meal, not a prohibitively priced adjunct. "A bottle of wine shouldn't be the center of the conversation at a restaurant," he contends. "It should be there for enjoyment. You should be able to sit down and drink a bottle of wine and just enjoy it. I want people to drink wine at my restaurant every time they come."
Like his friend and frequent customer Chip Cassidy (the Captain's Tavern is one of the precious few restaurants to which Cassidy doesn't bring his own bottle), Bowers dismisses the notion that top-end restaurants can't lower their markups. Though he doesn't disagree that pyramids of food carry high labor costs, there is, he argues, a limit beyond which it is unconscionable to go. And most local restaurateurs have exceeded that limit with gusto. "It's the one reason I don't eat out," Bowers remarks. "These high-profile-chef places A and I'm not going to mention any names A they say they don't sell enough wine that they can 'give it away' [at a lower price]. I think they're idiots."
So, for a time, was Bowers. "About twelve years ago, a man named Keith McComas (he owned Tropicaire Drive-in) told me, 'Captain, you've got a great restaurant but you've got a shitty wine list. Must be one of the wine guys [distributors] putting it together for you. Must be pricing it for you, too.'
"I said, 'If you know so damn much about wine, why don't you help me buy it?' Over the years we must have tasted 2000 to 3000 wines together."
That background still shows in Bowers, who refers to himself as a "wine merchandiser" and is as happy to sell a bottle of low-end white zinfandel as a bottle of high-end white burgundy. "A lot of people won't carry white zinfandel," he explains. "I sell four cases a week. These are entry-level people, people who've been drinking beer, hard liquor, but not wine. Ten bucks a bottle, they figure, how can we go wrong? Then, when they see that maybe it's a little too sweet for their taste, we move them to a sauvignon blanc, then a chardonnay. Before you know it, they're trying red wines A pinot noir with salmon, what an excellent pairing! Then they move on, probably to the cabernets, the Bordeaux.
"And then you got 'em hooked," concludes the restaurant owner, oblivious to the perfect metaphor but well aware of the path to profits.
Perhaps Bowers can afford to cultivate a wine-loving throng at his high-volume restaurant. That's not the case at the Armadillo Cafe, a long-lived and -loved Davie eatery known for its Southwestern cuisine. Though the ambiance is upscale, the cuisine likewise, the Armadillo is committed to low markups. After trumpeting the fact that the Armadillo is a Wine Spectator magazine Award of Excellence honoree (so are Mark's Place, Chef Allen's, and the Grand Cafe, all of which were included in the New Times survey), one of the first things manager Jim Carroll will tell you about his wine list is that the entries are marked up at double the restaurant's wholesale cost, at most. "Two reasons," Carroll says. Consumers are getting pretty sharp. They see a bottle of Kendall-Jackson in the store for less than $10, and they see it on your wine list for $25, $27. They know something is wrong. Also, we just want to give people a better value."
Of his competitors, Carroll shrugs, "That's the way they're focused A it's like a corporate mentality: You tell your bosses, 'I just cleared $10,000 this month selling wine at three times cost.' You go back the next month and say, 'I sold the wine at two-and-a-half times cost and made $12,000.' And they tell you that you could sell at three times cost and make $15,000 if you worked harder.
"I say you can't bank percentage, you can only bank dollars. But some people only see the percentage."
Around the nation, there are some signs that restaurateurs are pricing their wines with greater sensitivity. While 300 percent of wholesale was once said to be the restaurant-industry standard, that blanket pricing policy has largely (even in Miami) given way to a so-called sliding scale, on which lower-cost wines are still marked up three times or more, but the profit margin on higher-ticket items is reduced to a smaller percentage, down to twice the wholesale cost, or less. Largely, this seems to be a product of a more educated clientele, customers like the ones Jim Carroll speaks of, who know good and well what the retail price of a bottle is when they see it on a wine list, and who are less willing to forgive outlandish markups, especially on high-ticket bottles, which can translate to really big bucks.
Another factor is the competitive nature of the restaurant business itself, and the necessity of coming up with imaginative ways of ensuring a full house even in formidable economic times.
Three years ago the New York restaurant Cite introduced an intriguing innovation. The highly regarded French steak house, located in Manhattan's theater district, was doing a brisk lunch and pre-theater business, but after 8:00 p.m. the 385-seat behemoth was failing to fill. Brainstorming along with his staff, proprietor Alan Stillman, whose New York Restaurant Group owns four other New York restaurants as well as one in Chicago, devised a plan. They were already conducting a twice yearly Wine Week, a weeklong veritable bacchanalia during which each of their eateries poured up to fourteen different wines for patrons to sample along with their lunches -- for no extra cost. Why not take the bottles that were left over after Wine Week and offer them during the slow times at Cite? "It was a huge success," says the restaurant group's wine director Daniel Thames. "So huge a success that we decided to do it on a continual basis."
Beginning January 2, 1993, Cite offered unlimited quantities of four different wines, all with a four-course prix fixe dinner the customer could select from the regular menu. The first night, the restaurant served 365 customers -- more than four times the number of patrons who had visited on the same night the previous year.
"At first people thought it was a scam -- it couldn't be unlimited wine, you couldn't order anything you wanted off the menu," Thames remembers. "But they saw they could come in, order our big shrimp cocktail, a sirloin steak, choose any of our twelve desserts."
And drink all they wanted of any or all of the four varieties of wine that were being poured -- a sparkling wine plus two reds and a white (two whites and a red during the summer).
The company backed the scheme with a sizable advertising budget, a half-million dollars this year, according to Thames. The current ad touting the $50 deal is visible on full pages of publications as diverse as Gourmet and the New York Times. Though he says the proposition is "not a money-making situation" in itself, Thames adds that these days wineries must bid to be one of the sixteen labels chosen annually (the wines are rotated on a quarterly basis), and that hundreds of wineries are turned away each year.
Wine columnist Frank Prial says other New York-area restaurants are becoming equally creative. "There's a place in midtown that prices everything at fifteen dollars," he says with a measure of optimism. "As long as there are some places that are doing it well, it puts the lie to the places that aren't. And those places are going to get fewer and fewer people drinking wine."
All of this does have some bearing on Miami. The Grand Cafe, long a bastion of prodigious wine markups, has begun offering a takeoff on the Cite promotion, in which a four-course pre-theater (6:00 until 8:00 p.m.) dinner is offered with four different wines, at a fixed price. Choices are more limited than Cite's, and diners are limited to one glass of each wine apiece, but the price -- $35 per person -- is attractive.
"We want to make this a wine-friendly place," says Rick Garced, the undertaking's instigator. "Even though this is a high-end hotel and our clientele reflects that, I realize people are looking for value in everything they get."
To that end, Garced says, he is updating the wine list -- modifying the sliding scale -- and the cafe also began offering special monthly dinners to showcase different wines and attract more local diners.
Still, as the tables accompanying this article illustrate, restaurant wine pricing remains largely a capricious endeavor locally, subject to proprietors' whims and the prevailing theory that high markups are the key to economic survival A an entrenched belief that is unlikely to change, particularly amid a tourist-reliant economy that presupposes a big-spending crowd.
"What can be done about it?" Captain's Tavern owner Bill Bowers muses. "I don't know that anything can be done about it. Generally, restaurateurs are pretty big assholes.