Aug 2009 issue
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Smaller Pours, Bigger Profits Kara Newman
Walking into The Monday Room in New York City, no one would doubt this is an establishment that takes its by-the-glass program seriously. The petite wine bar looks not unlike a funky grandma’s sitting room, complete with fussy fleur-de-lis stenciling, Oriental carpets, and baroque black-and-gold accents. But what first catches the eye is the array of tall, ornate armoires stacked with row after row of immaculately polished glassware in all sizes—from enormous, round bowls for Pinot Noir to tiny, shot-size flutes for 2-ounce flights.
This is just one of a growing number of bars and restaurants adding smaller pours to their wine lists in the hopes of driving bigger profits. In today’s economy, when buying a full bottle of wine may sometimes seem like an extravagance, many patrons are still happy to pay for good half-bottles, quartinos, and by-the-glass offerings. Smart restaurants are tweaking their food-and-beverage programs to lure cost-conscious guests and to persuade them that the cost of an evening’s meal and wine is money well spent.
Dagan Koffler, formerly a sommelier in Mario Batali’s restaurant empire and now a wine educator and consultant, says that “most sommeliers are probably downsizing on their high-end offerings. I would look to increase wines in the $20-50 range,” he recommends, and that might include half-bottles as well as full bottles.
THOSE CUTE HALF-BOTTLES
James Tidwell, MS, CWE, sommelier at the Four Seasons Resort and Club Dallas in Irving, Texas, is among the proponents of half-bottles as savvy alternatives. At the Four Seasons, he reports, sales of half-bottles are on the rise, and guests “rave” about their options. The main restaurant offers about 400 selections, including 40-50 half-bottles and 24 wines by the glass or in 2-ounce pours.
“It sounds a little silly,” Tidwell admits, “but bring out a half-bottle and the reaction you get is, ‘Oh, it’s so cute!’ It’s like puppies. There’s a conversation around it. It’s always fun to bring them out.” And the reaction tends to have a ripple effect in the dining room, Tidwell adds: diners see the half-bottle sitting on a neighboring table, or see the enthralled reaction, and often ask to try one themselves. This response boosts sales in a way that by-the-glass selections do not.
The Ritz-Carlton in San Francisco includes 120 half-bottles and 34 by-the-glass pours among its extensive list of 1,200 wines. While the restaurant has always had a strong by-the-glass program, it has tripled its half-bottle offerings during the past year, “and it keeps growing,” according to Stephane Lacroix, Ritz-Carlton wine director and sommelier for The Dining Room. Lacroix attributes at least part of the increase in half-bottle sales to the recession. “At the end of last year, we could feel the economy was not at its best,” he says. “We needed to adjust to what guests want. They still want the great experience, but may not have as much time or money.” Most of the half-bottles at the Ritz-Carlton run between $25 and $60.
But these sommeliers say half-bottles are also a way to make wine lists more flexible. “You don’t have to commit to that larger size—you can try more and have fun,” says Tidwell. “And any time you offer more options to guests, you have more opportunities to make them happier.” Couples account for a sizable percentage of half-bottle orders at the Four Seasons, which, as a resort, tends to attract local customers looking for quick escapes. “Maybe he likes one type of wine and she likes another,” Tidwell explains, “or they’re driving back to Dallas, so they don’t want a full bottle.”
In addition to the intangibles of customer retention, Tidwell notes that offering half-bottles has boosted overall profits. “A lot of people, even now, are willing to spend more money on a nicer bottle of wine,” he says, “but often single diners and business travelers just don’t want to drink a whole bottle. They might commit to a $75 or $150 half-bottle. We offer more options, and people trade up.”
Lacroix concurs that “wine sales have increased” at the Ritz-Carlton. Guests ordering by the glass will often upgrade to a half-bottle, and many end up ordering two half-bottles. Even in today’s economic climate, Lacroix says, “$150 is the average check in the dining room; it hasn’t gone down.”
Although the economy has played a role in expanding the range of Tidwell’s half-bottle offerings, he plans to keep them on the menu even after the economy rebounds: “I consider this to be a cornerstone of our program.”
BY-THE-GLASS WITH CLASS
Jesse Webster is beverage director for the Avroko Group, which comprises three New York restaurants and bars: Public Restaurant, known for its extensive selection from Australia, New Zealand, and other New World areas, with strong full-bottle sales; The Monday Room, a small wine bar within Public that sells 90% of its French and other mostly Old World wines by the glass; and Double Crown, an eclectic fusion restaurant and the only one of the three to offer half-bottles, which account for about one-quarter of its wine list.
Wine sales for all three units are holding steady as a percentage of overall revenue, but the balance has changed, says Webster: “The proportion of sales has moved in restaurants to by-the-glass. People are looking for a smaller financial commitment.” He qualifies that assessment by mentioning that “on the weekend, our earlier walk-in customers are likely to order by the glass. But people who have planned dinner for a Saturday night, and that’s the main event—they are planning on full bottles.” Webster estimates that bottle sales at Public have declined from about 70% of total wine purchases in 2008 to 60% in 2009. At Double Crown (which opened in September 2008, making year-to-year comparisons difficult), bottles account for only 45-55% of overall wine sales.
How is Webster adjusting his wine programs? For starters, he’s beefing up the “first 25%” (the least expensive part of the wine list), trying to offer more bottles in the $40-or-lower range and more by-the-glass selections in the $7-10 range. Although The Monday Room goes as high as $30 a glass, most of its wines are less expensive.
CHALLENGES AND OPPORTUNITIES
Fleshing out a wine list that features unusual pour and bottle sizes presents a unique set of challenges. One is to find high-quality wines that don’t appear everywhere else while still keeping prices accessible. “Value is key and always will be,” Webster declares. He counsels other sommeliers to “explore wines on the fringe” and to mine emerging wine regions such as Slovenia.
With a large by-the glass program, another concern is to keep the product fresh by ensuring consistent sales. Webster recommends choosing wines with more inherent stability for by-the-glass pours. “Some wines improve after opening,” he says; “others collapse after 12-14 hours.”
Investing in temperature- and humidity-controlled wine-preservation units, such as Enomatic or WineStation, will ensure greater longevity for opened bottles, but the expense can be significant: $5,000-10,000 plus maintenance costs. For a bar or restaurant with robust by-the-glass sales (and sufficient space to house such a unit), it may be an option worth considering. For those with limited by-the-glass offerings, lower-cost preservation devices like Perlage (used for sparkling wine, and selling for around $300) may be the ticket.
Other sommeliers contend that half-bottles offer similar flexibility to by-the-glass pours, but without the storage issues. “The beauty of a half-bottle from a restaurant perspective is there is less waste,” says Lacroix. “A half-bottle is fresh, easier for inventory control, easier to track, and guests love it. If you sell two by-the-glass a week, do you throw out the rest of the bottle? You should, although most don’t. That’s a lot of waste.”
One of the greatest challenges involved with half-bottles is finding and continuing to stock the smaller sizes. “A lot of wineries go through cycles,” Tidwell laments. “They’ll bottle 375-ml bottles, and then they’ll pull it, and then it will come back again. It makes it interesting trying to provide any kind of consistency on a wine list with half-bottles.” One solution, he says, is to commit to a standing order, which will prompt most wineries to continue production.
Cellar storage can also present a problem, because half-bottles don’t stack in bins the way full bottles do. Compared to oversized magnums, however, the diminutive half-bottles are much easier to tuck away.
Whether it’s smaller pours or smaller bottles, such a program doesn’t always make financial sense. According to Koffler, it’s a matter of knowing what your customers want. If you’ve got a beer-drinking crowd unlikely to be seduced by miniature sips of exotic Sauvignon Blancs, you should play to your strengths. “If you’re a casual restaurant where you don’t sell a lot of wine,” he adds, “it makes sense to have maybe a couple of by-the-glass selections, plus 30-40 bottle selections.” At the other end of the spectrum, Koffler points to his former employer, Batali’s Otto restaurant: “People came to us for the 2,000 bottles on the list, not wine by the glass. If you’re trying to be a wine destination, it helps to have a great selection of wines by the bottle.”
Versatility is the key to making customers happy, whether they prefer 2-ounce tastes or elegant, chilled carafes. So whether we’re enjoying tapas with a half-bottle in a leather club chair at the Ritz-Carlton cigar bar or cozying up to a flight of Burgundies at The Monday Room, it seems that we’re all going to find more ways to indulge in great wines. The smaller-pours craze may also help many restaurants and bars ride out inhospitable economic times—as measured not only on the bottom line, but in the good will and enthusiasm of their guests.