The $$$ Case for Wine by the Glass

While there is something celebratory, even sexy, about a bottle of wine on the table during a meal at home or in a restaurant, it is important to dissect the financial aspects of wine sales by the glass versus the bottle to help you and the establishment you work for maximize sales, profits and TIPS!  

Let’s start with the basics.  All bottles of wine contain 750ml or 25oz of liquid.  In most establishments, getting 5 glasses out of a bottle it is expected.  Simple math means each pour per glass should be 5 ounces.   Breaking it down, for a bottle with a price of $50, each glass cost $10.

            $50 bottle / 5 glasses = $10 per glass

Restaurants often use a 2 or 3 time markup per bottle meaning the cost to the restaurant for the bottle in our example would be between $16 – 25.  Profit (not including any restaurant costs) will be between $25 – 34.  We will use a 2 time markup for the rest of our example so the profit per bottle = $25.

Many restaurants serve approximately 6oz per glass when customers purchase off the “By the Glass” section of the wine menu.  Based on this, each bottle would only contain 4 glasses of approximately 6oz each. For the same bottle as above, the price per glass would need to increase to $12.50 to make the same profit on the bottle.

            $50 bottle / 4 glasses = $12.50 per glass

Most restaurants, however, will price wine by the glass at a premium over bottle prices.  In our example, we would expect the restaurant to price the glass of wine at $14-15 instead of $12.50.  When we translate that into profit, a $14 retail for the glass (assuming the same $16-25 cost to the restaurant for the bottle) results in the following profit:

            $14 per glass x 4 glasses = $56 in sales

            $15 per glass x 4 glasses = $60 in sales

As you can see, the profit for selling the exact same wine by the glass would much greater than $25 if sold by the bottle!  

$14 per glass x 4 glasses = $56 in sales                         $56 in sales – $25 cost per bottle = $31 profit

$15 per glass x 4 glasses = $60 in sales                        $60 In sales – $25 cost per bottle = $35 in profit

If a restaurant sells 100 bottles per week, the additional profit can add up quickly! Let’s look at the difference between sales by the bottle and sales by the glass for 100 bottles of the wine in our example:

By the Bottle: 100 bottles per week x $25 profit per bottle = $2,500 per week            
By the Glass: 100 bottles per week x $35 profit per bottle = $3,500 per week!
Profit Increase by Week: $1,000

By the Bottle: 100 bottles per week x 52 weeks x $25 profit per bottle = $130,000 per year
By the Glass: 100 bottles per week x 52 weeks x $35 profit per bottle = $182,000 per year!
Profit Increase by Year: $52,000

Grab the wine menu at your restaurant or establishment and do a few examples following the formulas above.  If you no know the exact markup used at your restaurant, do a quick online search to find retail pricing for a few bottles on your list as a starting point!We’re sure you’re thinking – ok so what’s in it for me???  In the next section, DOMSOM will break down the math for you and the impact on your potential tips!