Feb 212013
 
Eating out in Spain

TAPAS BAR

Wine producers have always criticised restaurants for charging too much for their wines, and the restaurants reply that to survive they have to uplift prices by two or three times their cost.

Both groups are right in a way, and unfortunately the practice of charging a fixed uplift per bottle instead of a percentage increase has few practitioners. Restaurants are also right when they claim that to acquire and store an expensive wine costs more than is the case of a cheap wine (tied-up capital, etc.), although the producers allege that to serve one bottle of wine costs the same as serving another.

The question that needs answering is: would lower restaurant wine prices encourage people to drink more, so the restaurant could make more money?

Somewhat amazingly there appears never to have been any comparative tests carried out on the subject. How difficult would it be for restaurant to charge a fixed uplift of, say, ten euros per bottle, for a month, then revert back to the usual method, and then see which option gave the bigger profit?

There are a few local restaurants that are real wine-lovers’ paradises, where you can take your own wine and not get charged corkage. They accept that they will only make money on the food you eat, and that if they don’t permit you to drink your wine you will go somewhere else that will be permissive. Unlike in the USA for example, where corkage in a New York restaurant can run from as little as $10 to as much as $35 per bottle, with a limit on the number of bottles you can take. But at least some of the restaurants will waive the charge if you take an exceptional wine and are thoughtful enough to invite the owner to enjoy a glass.

A group of wine aficionados met in the La Nueva Campana Restaurant in Nueva Andalucia Spain earlier this week, and although it is not in the corkage business, we shared some bottles we had brought. The first up was a Pérez Texeira communion wine, blessed by Don Angel Herrera y Oriá, Bishop of Málaga, in 1953. Half the bottle had been lost by evaporation, and it was really just a curiosity, but interesting. Then came the Austrian Alzinger Federspiel 2011, made with the rare Grüner Veltliner grape variety, very impressive. Unfortunately the Ranni Marlborough Wairna Valley Pinot Noir 2010, appeared not to have survived the voyage from New Zealand, and was quietly parked.

Without question the star of the lunch was the Sedella 2009, brought by Charlotte Rodríguez, of Cervinco, a ‘Málaga Mountain Wine’, as such varieties used to be known two centuries ago in export markets. This new wine made from Romé and Garnacha grapes is the personal project of young winemaker Loren Rosillo, (of Martínez Bujanda, Rioja, and other bodegas). The Chateau Climens Sauternes 1983, put up by host Garry Waite, was everything you could expect from such a celebrated wine.

AJ Linn

(Originally published in Spanish in Diario Sur 19 Jan 13)

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  2 Responses to “Inflated Wines, corkage in Spain”

  1. That all sounds very yummy! How about a go at describing what that communion wine actually tasted like?

    Points will not be deducted for going all ‘Oz Clark’ on us, all fantastical – “Smells like a Canteloup melon split wide open by a cover drive by Davis Gower”

    I had a bottle of ‘Martínez Bujanda’ Garnacha from Laithwaite’s last week. Regrettably it was rather ‘jammy’. More ‘Bonne Maman’ than I would like. Not as bad as some super-jammy Garnacha I had from Virgin Wines back along. Like mouthfuls of Asda own-brand strawberry jam.

    At least with Virgin and Laithwaite, if you tell them you didn’t like it, they refund you. If you drink one bottle from a case and don’t like it, they refund all 12 and come and take the rest away, foc.

    As this was from a case of unsaleable damaged-label bottle via someone who works there, for £2/bottle one would be cheeky to complain. The bottle of NZ Pinot Noir was, like yours, sadly disappointing. I was expecting great things. The £18 Ch Neuf du Pape was no great shakes either.

    I have to confess I took a great liking to Vino de Malaga when my school moved to Estepona for the Easter term in 1962. Me and my mate Speccy Ferguson used to saunter to the village bodega on Saturdays and, after sampling a few, always went for a bottle each of the same one. The cost was 1s 6d in old money – cheaper than sweets!

    Coming back with our bottles one Saturday, looking forward to an afternoon of gentle inebraition, we came across the art mistress, Mrs. Jamwrack [honest!] sitting on a ‘mile stone’ in a rather tired and emotional state, as Private Eye would say. She had clearly been sampling at the bodega earlier. Me and Speccy managed to walk Mrs. J about a mile back to base, not easy as she had little use of her legs and was a dead ringer for Hattie Jaques.

    I have had some T-shirts printed with the call that went up from the Headmaster in the bar every evening – several times – during his game of Shove Ha’penny with the Maths Master, Commander McPherson, versus two of the senior boys [all of 13 y.o.!]. Losers bought the next round, so the cry would go up from Mr. Dunlop, in Sandhurst mess-night tones, “Cuatro vinos tintos, por favooooor!”

    I was … er …. not 12 years old till Aug later that year.

  2. I am not a wine aficionado so can’t comment on the quality, but your suggestion on pricing and mark up are questionable. Reducing the price would not necessarily encourage more consumption, and even if it did, it may not have desirable outcome.

    Firstly, from all the medical evidence and social studies findings, I am surprised you think encouraging people to drink more is a good thing. Governments across the world are trying to go the opposite way by pilling on taxes not just because it is an easy target but also because of social and health issues drinking causes.

    Secondly bringing prices down in a restaurant will not increase consumption enough to make up the loss of revenue. Very simply put, if wine consumption was 100% respondent to the Elasticity of Demand then for every 1% reduction in price the consumption would go up by 1%. Let’s not be under any illusion as no single product in the world responds in this way even though Elasticity of Demand is a valid economical and pricing model, it is never absolute or predictable. So for the sake of argument let’s assume a 10% reduction in price will increase volume by 5% (that is a pretty optimistic ratio). So you reduce the price by 50% which means your volume will rise by 25%, and hey presto, your revenue and profits have gone backwards by 25% irrecoverably. So your suggestion on price reduction generating more revenue does not hang together.

    Additionally, how much more can a person drink with a meal? With the drinking and driving consideration at least one person at each table is unlikely to consume more than the legal limit (one hopes). Assuming there is an average of 3 people per table (half the capacity with 4 people and the other half with just 2), then only 2 people at each table can consume more wine. Unless they are wine guzzling alcoholics, how much more can the other 2 drink with their meals to make up for the loss of revenue?

    Finally, the price of food in restaurants in Spain has come down significantly since the recession has began in 2009. Menu of the Day now is averaging €8 per person for a 3 course meal including a drink, which is frankly unbelievable. You could not cook that cheaply at home, so where do you think the restaurants are going to make money? We need them to make money if we want them to be there next week or next month for us to visit. Drinks including soft drinks are the last real profit centre left in restaurants, and if that comes under pressure too then either price of food has to go up or restaurants will go out of business. Neither are desirable outcome for either side of the table.

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