Wine Expense

Let’s face it, wine is an expense. In many ways it’s like spending on your better half but at least there you have assured returns, perhaps, even a credit facility. Also, no matter how high the margins when spending on women, we somehow seem to find our own justification.

But where is the justification in wine margins? I am yet to successfully pick up a lady by tempting her with Latour ’62 and I AM a sommelier! Even firemen stand a better chance by simply promising a ride around the block on their red engines!

But this isn’t about women, or me (really?)…this is about wine margins and how ridiculously preposterous they are. Or preposterously ridiculous. Either ways, it’s an outlandish redundancy!

First of all let me clarify a few things. Taxes are high and we all know that. But for those who may not know, most hotels buy their stocks duty-free i.e. sans the high 160% central duties. They do pay state levies which in Delhi is fixed at INR150. Other states are incongruently and illogically high and we can only hope that Delhi doesn’t catch the malady. But that may, at best (actually worst), double or treble prices, but what is truly killing is when those prices are further being doubled or trebled by some F&B stalwart who is as sensitive and passionate about wine as a hunter is about bunny-huggers.

Now let me share the reasons why hotels say they need to maintain such margins and alongside, let me give the reasoning as to why they couldn’t convince an albino penguin with such logic. They are

  1. Indemnity against corked wines: Outlets argue that when an expensive wine turns up corked they have to absorb the cost. I say that if you send the cork back to the Chateau along with a letter explaining the same (they like to analyse and improve) most of them replace the bottle with one from a current vintage, which isn’t that bad, considering that most hotels sell the worst of vintages Bordeaux has ever seen.
  2. Storage Fee: Outlets argue that the cost of storing the wine under controlled conditions needs deep pockets. I say that well-priced wine moves fast thereby reducing the need for long term storage and 80% of the wines drunk in the world today are usually young (2-3 years from vintage) and ready-to-drink.
  3. Service Fee: Outlets say they charge for the service meted out. What service?? Am yet to see any. It is as convincing as asking me to pay taxes for better roads.
  4. High license fee: Sure hotels need to renew their liquor license every year and that is expensive but nothing that volume sales can’t write off. Outlets in the world work on a frugal cost-plus formula in regions with equally strict tax regimes and still manage to stay in business decades on; why then can’t such models be emulated here?

I recently had a super-fabulous meal in a fairly expensive restaurant where no bottle cost us more than INR2000 and these were the most iconic wines of South Africa. Those wines will sell in hotels in India for around INR15,000 when they could easily be sold for INR5000/- (no don’t tell me I am wrong, I did my homework). The reason is simply this: outlets and their greed, not to mention their inexplicable notion of trying to pay every bill solely through wine sales!

There was a time when putting in an extra “K” or three “Z”s in a name was considered a typo but today it is considered numerological balance. To me those loosely scattered-like-garnish letters still look silly. Similarly, wines coming with an extra zero added right there in the end will never balance out anything in my books! To all F&B: get smart or else be ready for some serious wrath!

 

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