Wine Down

J. Henry Dunant III restaurant in The Netherlands

Image via Wikipedia

Well, the power finally came back on late yesterday after five days in the dark.  It was an interesting departure from broadband internet access, cable TV, and hot water.  More on that next week.

For now, as promised yesterday, here is the second of our business tidbits the personal energy crisis caused me think of.  Since it involves a restaurant here in town, I thought it appropriate for our Foodie Friday Fun post. We were having to eat out since cooking on the stove (the gas still works) is hard in the dark and without a range hood the place is kind of smoky and smelly (in a good way, mind you!).  In the process, I learned a little something. We went to a place we’ve been before and found out it was Wine Down Wednesday – all bottes of wine were half price.  Now if you buy wine in a store and then see it on a menu someplace, you know that most joints mark the bottle up 100% – a $20 bottle at retail will cost around $40 at a restaurant.  What this place has done is drop the price down to about what they pay.  However, since the place was pretty full for a Wednesday (and most of the town does have power back), and there was at least one bottle of wine on each table, giving up their margin on the wine (not exactly a loss-leader since they’re not selling below cost) was a smart thing in my book.  The staff is happy to make another night of great tips and they can clear out the food inventory before the weekend orders show up.  Smart business!

The restaurant was focused on delivering what’s perceived to be high value at relatively no cost to them.  Often we get hung up on “rate cards” and forget the “cost-value” equation that seems to govern the buying mindset, whether among consumers or businesses.  Since the margins on food in a restaurant are way lower than those of wine, cutting back that higher margin to fill the place on a slow night makes a lot more sense than offering inexpensive food at a loss.  Everyone wins here – that’s smart business.

You agree?

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