The article below is a great dive into assessing the financials of your restaurant's wine program. For certain, building and managing a well designed wine by the glass (BTG) program is a KEY to maximizing profitability.
This is a solid article by Erik Segelbaum, and well worth a read:
My key takeaways for the financials of running a restaurant wine program:
There's always pressure to increase revenue and profitability, while reducing expenses. Always.
Your wine BTG program is critical to your success. Higher profitability than food, selling more wine by the glass drives profit dollars at low operating expense. As the article says, "A well-curated BTG program can be a lifesaver for most restaurants."
You get more profit dollars to your bottom line by pouring higher price glasses. Worry less about margin percent, and more about margin dollars.
Actively manage the BTG and full bottle programs, and ensure there aren't big price gaps in each variety. Customers will move up in price if a reasonable gap exists between what they may "normally" order, and what they "want" to order
Keep building partnerships with key wine suppliers. Strong vendor relationships will ensure continuity of supply, introduction of new bottles/glasses, and ability to "keep it fresh" with interesting choices and pairings.
Most Restaurant Operators Know all of this...
So why don't more restaurants expand their BTG program and take advantage of the financial opportunity to increase gross margin dollars?
Fear of waste.
Historically, a wide BTG program resulted in a lot of wasted wine. You have to have more open bottles of wine, and spreading BTG wine purchases across more open bottles, you were risking wine going bad before you sold the whole bottle. The result - a crushing "wine dump" of bad tasting wine (read "Why Do Open Bottles of Wine Go Bad") down the drain.
It doesn't have to be this way!
With an effective wine preservation systemin place, you can eliminate the wine waste / wine dump, AND ensure every glass you serve tastes great. Using wine preservation behind the bar is a key enabler for stronger financial performance for your BTG wine program.
For less than 10 cents per bottle, you can eliminate wine waste and confidently expand your wine by the glass offering. Here's a fun thought experiment... If you only serve one more glass a day at these price points, here's how much revenue you can generate by inserting a higher price wine by the glass offering on your menu:
We know 100% Argon is the best wine preservation method. Both Coravin and Silvadore use 100% Argon to preserve wine. So, which one is the better choice for you to use to preserve wine in your fast paced On Premise environment? Read on...
By using wine preservation, you'll be able to increase wine revenue. Wine preservation as a powerful tool to expand your wine by the glass program. Use wine preservation to increase full bottle wine sales. And a wine preserver is a great marketing and promotional tool. Here's how...