Pricing

Wine markup is not wine margin

Markup is not gross profit. Pour cost, profit per pour, and why a flat 3× wrecks a restaurant wine list. For F&B managers and sommeliers.

Written by Marco Azzari on

A multiplier on wholesale cost is easy to explain and usually wrong as a system. Bottles do not cost the same. Glasses are not bottles. Rent and payroll do not care whether the line is a $36 house bottle or a wine you are scared to sell. A flat markup makes cheap wine look "healthy" on paper and famous wine look ambitious until the guest googles it.

This page is the translation layer. F&B already speaks pour cost and beverage cost %. Sommeliers often do not, and then they lose the budget meeting to someone who does. The palate is not the problem. The missing number is.

Three words that get mixed

Markup. Menu price compared with cost. "Three times wholesale" is a markup story. It says nothing about what is left after breakage, overpour, comps, and the mix of glass versus bottle.

Pour cost (wine). Cost of the wine you sold, as a share of the wine revenue. Useful. Incomplete if you chase one % for glasses and bottles together and then strangle the glass program because the % "looks high."

Gross profit per pour (contribution). What is left on the line after the true cost of that line. This is the number that pays rent. A glass at a "worse" pour-cost % can still drop more dollars in the register than a bottle with a prettier %.

If a director asks why beverage cost is off plan, answering with a multiplier is how you look like you do not own the category. Answering with gross profit per pour, in dollars, on the pre-tax menu price, is how the category becomes a sentence you can finish. Glossary: restaurant numbers.

Why a flat 3× (or 4×) fails now

Old restaurant folklore says three times wholesale on every bottle, four if you can get away with it. American guests now check retail on their phone. Famous labels at 4× sit. Meanwhile the house pour, still at a 2019 price, prints volume and leaves the month gasping.

Two rooms, same markup, opposite deaths:

  • Markup high on googled names: full bottles in the cellar, "people drink less."
  • Markup low on the pours that actually move: busy glasses, no money.

Phone-check markup is the guest side. Price the list is the three-line start. By the glass is where gross profit is often best if you stop using bottle logic on a 5 oz pour.

For the sommelier in the meeting

You already know what a good pour does to a table. Management needs profit per pour, mix, and whether the program is a cost or a line that floats a kitchen. Those are learnable. They are not a betrayal of the craft. They are how the craft stays on the payroll.

About the author

Marco Azzari

Founder of Wine CFO · Wine List Engineer for restaurants

I help restaurants, hotels and bars earn more from the wine they already sell. I price lists wine by wine, cost by-the-glass programs on their real yield, rebuild selections around the food menu, and rewrite lines so guests understand what they're ordering. Every Wine Profit Checkup goes across my desk personally.

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