FAST FIVE
Boosting Wine Sales
Centerplate’s John Sergi talks about pricing for contribution,
defining the middle, and making it fun.
By Barry K. Shuster
J
ohn Sergi, chief design officer for Centerplate,
develops guest experiences at entertainment and
sports events and venues around the world, but
his foodservice roots are deep in the independent sector. A graduate of and instructor at Cornell University’s
School of Hotel Administration, Sergi started in this
business working at a friend’s Italian deli when he was
11 years old.
Wine has always been part of his long career. Says
Sergi, “I have a weird wine background,” which included managing a wine store in Southern California
and selecting wines as a general manager for a restaurant company. As a Cornell student, he was a graduate
teaching assistant for the advanced wines class.
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PROFITABLE RESTAURATEURS ARE ALWAYS LEARNING
His philosophy regarding wine is straightforward:
Make it accessible and uncomplicated and you will
sell more wine. Recognizing that stadiums generally
do a poor job selecting and selling wine, he revamped
Centerplate’s program, calling it Think Wine, and
worked with several major producers to get stadiums
and their guests to think about wine differently at
sporting venues.
“Independent restaurateurs often don’t have the resources to develop strong wine programs, and lean too
heavily for guidance from the distributors,” Sergi says.
He spent time recently with RS&G’s editor to answer
five fast questions about boosting wine sales in the independent restaurant.
FAST FIVE
RS&G: John, a lot of
operators use simple
cost margins to price
their wines. In other
words, they impose
a target markup —
maybe 300 percent —
across the list.
You said that is
a mistake.
JS: Yes. Your pricing strategy
should be based on contribution
margins, not cost margins. You
want to give your guests incentives to spend more on wine and
experiment. I suggest a graduated
pricing method. For example, you
might mark up your lowest-cost
wines 3 to 3¾ times and your most
expensive wines 2 to 2¼ times.
You don’t want to price your
higher-cost wines out of reach. A
graduated pricing structure makes
some of the better wines look like
a good value. My goal is to make
guests comfortable with wine,
which will encourage them to
spend more on wine. I am looking at the total contribution to my
margins, regardless of how that
translates to specific bottle sales.
RS&G: You talk about
using ‘pricing as
education.’ How does
that work?
the server to validate the choice.
It makes the wine list easier for
the customer to use.
RS&G: What about
operators who don’t
want to offer more
expensive wines?
Maybe their market
doesn’t support those
kinds of sales. How
do they create interest?
JS: One strategy that I liked
was “40 wines under $40” as part
of the operator’s concept. This created excitement around the idea of
good wine values. People would
feel comfortable buying more than
one bottle. The key is to put stuff
on the menu you would drink. It
shows the customer that you can
have good stuff at every price
point. And it creates a sense of fun
around wine, which is important to
make guests feel comfortable.
“One strategy that I liked
was ‘40 wines under $40’
as part of the operator’s
concept. This created
excitement around the idea
of good wine values.”
— John Sergi
JS: You can use pricing to do what I call “define the
middle.” Let’s say you have a 36-bottle list. I might put
eight bottles at under $40, 16 bottles at $45 to $60 and
12 bottles at more than $60. The middle of the list —
the wines that are a step up — becomes clear to the
customer. Part of that strategy requires at least one of
each of the popular varietals offered at the lower range.
For example, you don’t want three cabs (cabernet) under $40. The guest should be able to get an appropriate
wine at the lower end. Putting 40 percent to 50 percent
of your wines, with several choices of each variety, in
the middle price range, makes it clear to the guest that
these are a step up and can encourage him or her to
spend a little more without the embarrassment of asking
RS&G: You caution
operators from relying
solely on distributors
and suppliers to choose
wines, since they are
often promoting
certain wines based
on their own sales
goals. If you’re not an
expert, whose advice can you lean on?
JS: Make friends with the local wine retailers. They
know what is popular and have tried most of the wine.
They will be happy to help you, because if you are serving wines they carry it will tacitly promote their sales,
as well.
RS&G: Any parting
wisdom for operators
trying to boost their
wine sales?
JS: Make it fun — for you, your staff and your guests.
Remember that overinforming guests on wines can be
a source of intimidation. Your mission is to make wine
RS&G
more accessible.
JUNE 2014
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www.RestaurantOwner.com
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