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+--- Thread: Selling By The Glass, Bottle and Retailing in a Wine Bar (/thread-3091.html)
- rain4st - 07-22-2000
Hello everyone,
Well we have opened and are excited about the new business. I still have questions about pricing however. I have been using the price x 2.5 for the sale of a bottle (on premise consumption)and price x 3 divided by 5 (pouring 5 oz.)for the price per glass. I then sell the bottle (retail to go) at $4.00 off the "on premise price". *Reverse of corkage fee.* My dilema is that I believe my retail prices are too high.
Example.. Greg Norman Estates Cab/Merlot my cost is $12.75 per bottle. Per glass price is $7.75 and $29.00 per bottle (includes corkage fee). I have been selling the bottle to take home for $4.00 off for a total of $25.00. Although I have not had any complaints, I think I am too high on the retail end. I just visited Greg Norman Estates on line and suggested retail is $17.00.
The Greg Norman Estates is new to this area, so no one is able to compare price. However, I would like to build the retail end as well as the "on premise consumption" and do not want the public to think we have over priced the retail wines. This is only one example, but one that holds true for the other 40 wines that we pour.
Anyone else selling retail as well as on premise? Please help! If I price too low on the retail end the customers inside the wine bar may take exception. Anyone have an actual sliding scale for both retail and on premise?
Many customers are enjoying the ability of tasting and purchasing the wine for later consumption, so this point is very important.
Thank-you in advance for your help!
- Jason - 07-23-2000
The formulas you are using are guidelines and must be adjusted for individual bottles. Some of the more corporate places use strict formulas and don't buy anything that does not fit into that formula. Hence, crappy wine lists at most big chains.
The better way to do it is to look at every bottle and consider what the market will accept. For instance, if you have a low production cult chard you can charge a premium for it. But, if you have something like Forest Glenn Chard you better be competitive, because the consumer can get it anywhere and will find somebody who is willing to take a very small margin on it.
Lets use your Norman example. Since it is new to your area the importer's rep is around cutting deals to get market share.
He'll sell a larger place 10 cases and will probably give them at least 1 cs no charge as an intro special. That brings his cost down to $11.59/ bottle. Suddenly that $17 suggested retail looks pretty reasonable.
Your formula for on premise is high and way high for retail. You need to think in terms of volume and market share, especailly since you are brand new.
As far as glass price I would suggest $5.95. You still are at 42% cost but the price is far easier to swallow. Wines by the glass lists are an exercise in balance. You will have wines that will be 40-50% cost, but you can balance it out with high volume less expensive wines such as your house selections. In most places the house wines subsidise the rest of the program and allow you to offer some cherries while still making money overall.
If you would like more info feel free to email me, as I am also familiar with the distribs in your area.