LONDON (Reuters Life!) - Restaurants across London have slashed prices for fine wines to encourage drinkers to treat their palates to traditionally more expensive vintages, while boosting margins at the same time.
Restaurant chain D&D London has cut the prices of 2,000 fine wines listed at 50 pounds ($81.13) and above and is promoting a “Top 100” at heavily discounted prices until March 14.
“We’ve had a fantastically positive reaction to that in the first days,” said Des Gunewardena, Chief Executive of D&D London, whose 20 swanky venues include Coq D’Argent, Paternoster and Launceston Place.
But while the promotion may only be temporary, it signals a longer term shift to reduce mark-ups on vintage wines to sell more bottles.
“This isn’t a completely altruistic move,” Gunewardena said.
“We’ve taken the decision that we’d rather sell a lot more wine at a lower mark-up than we do now, rather than selling a lot less wine at the current mark-ups that we have.”
Among the top tipples on offer are a 1995 bottle of Chateau Petrus, Pomeral for 1,450 pounds, while a bottle of Cristal Louis Roederer 2002/2004 champagne is less than half price at 156 pounds from 323 pounds.
The price-cutting spree follows other London restaurants that have slashed mark-ups on fine wines to tempt customers to opt for more expensive stock.
Leonid Shutov, co-owner of luxury restaurant Bob Bob Ricard, has a maximum mark-up of 50 pounds on any top wine.
“We give people a great reason to upgrade,” he told Reuters.
“In a typical restaurant the bulk of their volume is going to be at about 20 pounds a bottle. For us, the bulk is much, much further up. So it’s a win-win: we make a decent cash margin, while the customer gets a phenomenal deal.”
Restaurants can typically mark up a bottle of wine by 60 percent, according to Jeffrey Benson, chairman of the London branch of the International Wine and Food society.
Bob Bob Ricard sells Pol Roger 1988 cuvee for 153 pounds a bottle, which retails for about 1,000 pounds at some other London venues.
“Some of the wine that other restaurants will maybe sell six bottles a year of, we will sell over a 1,000 bottles a year,” Shutov said. (Reporting by Caroline Copley; Editing by Paul Casciato)