Scanning the wine list at a restaurant and settling on a familiar name — only to notice the price is sometimes two or three times what we've paid at a wine shop.
Celebrity chef and restaurateur Tom Colicchio explains that all restaurants mark up wine to take into account their own costs while still earning a profit. He also reveals how to get the best bang for your buck in that situation.
Following is a transcript of the video.
TOM COLICCHIO: They'll go to their local wine store and go, "Oh, I can get this bottle of wine for $20. At a restaurant, it costs $60."
We're factoring other factors that go into that as well.
The mid-priced wine — we're looking for a 30% cost, but an expensive wine — we're okay with a 50% cost, because now, you're looking at gross profit.
So, if a bottle of wine costs me $200 and I sell it for $400, I'm making $200 every time I sell that wine. If I buy a wine for $10, and sell it for $32, I'm only making $22 every time I sell that wine. So, I — the margin is better on a lower-priced wine, but the gross profit's better on a more expensive bottle of wine.
PRODUCER: It might be a better bang for your buck to get the more expensive wine.
One thing to do is, and you can do this online. A lot of restaurants have their wine list online. So, you can actually compare restaurants.
So, find that same bottle of wine, same vintage. Make sure it's the same vintage, it's really important.
And then compare restaurant to restaurant. And then you can see who's marking up wine more aggressively than other restaurants.