red wine glass

Pricing of Wine By The Glass

David BECK Academic - Economics, Society and Political science - Environment and Technologies (AI, blockchain)
1. Pricing Wine by the Glass
2. Wine BTG: do’s and don’ts
3. Should you have a wine BTG program?

Beverage programs need three things: restaurant sales, a good pour cost, and a decent profit margin. Wine by the glass (WBTG) programs help with all those restaurant business KPIs. They’re quite profitable if you get the pricing right. But that can be tricky. You’ve gotta factor in sales trends and cost of goods sold.

Many bars and restaurants offer wine by the glass. A wine by the glass menu is often a fraction of the size of a proper wine list. Offering every in-house wine by the glass requires opening up every bottle of wine. Wine degrades much quicker once opened, so the potential for waste is massive. It’s also a great tool for coming up with restaurant marketing ideas.
That’s also the reason why wines by the glass are pricier, per glass, than a bottle of wine. You’re paying for the risk the restaurant assumes of that opened wine going to waste.

Read also What is the Profit Margin on Wine?

Wine Glass Mark-up

A single glass of wine is typically priced at 85 to 100% of the wholesale cost of the entire bottle. Most wine bottle pricing marks up wholesale bottles around 200 to 300%. If you acquire bottles of wine from a vendor for $12 wholesale, you’ll sell them for around $36 retail. An accepted way to price that wine by the glass is $10 to $12 per glass.

There are some exceptions to that wine by the glass formula:

  • The bottle you’re pouring from is extraordinarily inexpensive. Let’s say a supplier got you some decent wine for $5 per bottle wholesale. You don’t have to follow the above formula. Price the wine by the glass at whatever minimum you’re comfortable with. Most guests won’t bat an eye at wines by the glass around $7 or $8.
  • The bottle may also be so expensive that a wine by the glass priced at its wholesale amount is too high. It takes a special kind of clientele to pay $30 for a glass of wine. But that’s roughly what a wine by the glass would cost if poured from a bottle that sells retail for $100. When you encounter this situation, it’s usually a good indicator that a particular wine isn’t a great candidate to be on your wine by the glass list.

How Much Is a Glass of Wine?

The average cost of a glass of wine at a bar is around $12 per glass. Though, because of the exceptions to the wine by the glass pricing rule, this is a pretty loose average. $8-10 for a wine by the glass is on the cheap side. $15+ is on the expensive side. It all depends on the quality of the wine and the price the bar or restaurant got it for from their vendor.

There are obviously more factors to consider when pricing than wholesale cost.

1. Consider the specifics of your business

For bars, restaurants, and hotels, there are three big ones:

  • Concept. If you’re a destination restaurant, a fine dining establishment, or any other hospitality business that depends on an association with sophistication or elegance, you can charge more. You’re not just charging for the wine in the glass. You’re charging for the decor, the training, the furniture, the location. Everything that makes your concept unique. That stuff’s valuable. You’ll also need to factor in your overhead expenses when setting prices.
  • Commitment to wine. If your business is committed to running a thoughtful, curated wine program, you can charge for it. Your bartenders and servers are trained in wine service. Your bar managers or sommeliers put a lot of effort into sourcing and acquiring wines. You invest in quality glassware. A commitment to wine often demands a premium.
  • Clientele. This goes hand-in-hand with point 1 above. Some folks are willing to pay more for things. That’s mostly because they’re comfortable with the fact that they’re not just paying for the commodity, they’re paying for the experience. If you have an experience-driven clientele, you can charge a little more.

Figuring out price points that maximize sales while maximizing pour cost is a field of study all its own. It’s called menu engineering. It’s the art and science of turning your most profitable drinks into your most popular, and vice versa. It involves taking wine inventory frequently, and a liquor inventory sheet helps with that.

Doing so will uncover what wines sell at what price or what bar promotions or happy hour ideas work best for your wine list. Learn how to do it. Learning how to price a menu unlocks your profit potential. Many restaurants with great wine lists do the same.

2. Don’t Charge an Arm and a Leg

It’s well-known that wine is marked up massively from supplier cost. Guests know they can get a $50 bottle of wine from your restaurant for $20 at a liquor store. So try not to rub their face in it.

3. Have a Small List with a Healthy Variety

Having an enormous wine by the glass list isn’t profitable. That’s because wine expires quickly when it’s opened.
Having dozens of open bottles waiting to swirl down the drain is horrible for your pour cost. 10 wines by the glass is about the maximum unless you’re moving wine by the glass. These are general guidelines. Adjust them to your individual business.

But, from the numbers we’ve crunched, a wine by the glass list of 7-10 is the sweet spot. And you gotta make those wines count. Try to hit every possible flavor profile you can. Varietals, regions, reds, whites, dry, bold, fruit, floral, etc. The key to a successful wine by the glass list is grape variety.

4. Don’t Offer Only Familiar Wines

We see a lot of wine by the glass lists populated with greatest hits. Good wines, sure, but don’t go strictly for brand recognition as a sales strategy.

Indeed, one of the great things about wine by the glass is that guests can take a chance and discover something. Discoverability is a big part of upselling wine and liquor. Maybe they’ll be interested in a whole bottle of this new elixir that has so captured their spirit.

So include some lesser-known winemakers, regions, or varietals as an limited time offers (LTO’s). Write some enticing copy. Build in the opportunity for your guests to be delighted.

5. Seek Out High-Value, Up-and-Coming Regions

There’s a lot of value and quality in wine from production regions that aren’t France and Italy. Look into Australia, South America, and Portugal. You’ll nab amazing wines at wholesale prices that are a fraction of the cost of typical bottles. That’ll do wonders for the affordability and accessibility of your wine by the glass menu.

6. Embrace Psychological Pricing

Bars and restaurants can learn a lot from psychological pricing practices. Even if some don’t directly apply to the foodservice industry, there are a lot of useful principles at play that can be integrated.

Example of Wine By The Glass Menu List

Having trouble putting together a wine by the glass list? It’s okay. Everyone gets winer’s block at some point. Here are a few wines we’ve found perform particularly well by the glass in the United States. We approached this as if we were putting together a wine by the glass list of 8 wines.

Napa Valley Cabernet Sauvignon
Super Tuscan Blend
Willamette Valley Pinot Noir
Chilean Zinfandel
New Zealand Sauvignon Blanc
Spätlese Riesling
Sonoma Valley Chardonnay

There are four wines from the Americas, one from Australia/New Zealand, and three from Europe. There are five red and three white. There are classics like a Napa cab, but also more adventurous choices like the Grenache-blend Châteauneuf-du-Pape. And it runs the gamut from light- to full-bodied and from sweet to dry.

Should Your Restaurant Have A Wine By The Glass Program?

Having wine by the glass program is a great selling point for your restaurant and a great way to accommodate guests’ needs.
But you should always consider your restaurant’s limit first before deciding on whether or not you should carry a wine by the glass program. Make sure you continue to study how to increase restaurant sales and invest in bar accounting software or a wine tracker so you can properly track your revenue.

Pay close attention to your maximum and minimum price for your wine glass. Because they are tied directly to your profits. If you’re struggling to find good wine bottles that fit your price limits, work with your local distributors’ sales reps for a better deal. Or find another vendor. It’s important to learn how to manage cost for restaurant business and control your restaurant balance sheet to succeed.

Sometimes, the best option is to not offer the wine by the glass choice at all. It may just not make sense with the bar profit margin goals you’ve set for your business. But you’d be wise to try to make it work. Because when it hits, it hits big.

Once you’ve got your wine by the glass menu set, adjust prices on your a la carte menu, or prix fixe menu to match.

Academic - Economics, Society and Political science - Environment and Technologies (AI, blockchain)