The results are in!
In anticipation of the recent inaugural Michelin Guide Napa Valley Summit at which BinWise hosted the keynote session for Michelin participants on “how to successfully run a beverage program in today’s environment”, we sent a survey to 30+ of our customers representing the restaurant industry’s leading wine programs.
We received an 85% response rate comprised of owners, beverage directors, master sommeliers, and sommeliers. The programs these responses represented were varied in style and cuisine, ranging from 1 to 3 Michelin stars, from pizzerias and wine bars to white-table cloths, and geographically represented both coasts (with a few spots in between). While the programs represented may be vastly different, many of the challenges expressed and how to tackle them are very much the same.
A warm thank you to BinWise customers below who took time out of their busy schedules to complete the survey. Your feedback was invaluable and rendered some interesting insight which we shared with Michelin participants.
Question #1 What are some of the biggest challenges of running a beverage program?
- Program “freshness” Maintaining excitement in the program for both customers and staff while balancing financial and in-restaurant spatial limitations. Whether you are running a small or large program, ensure that your inventory (or a % of your inventory) is fresh and constantly changing, especially your by-the-glass.
- Managing vendor relationships Set boundaries with your vendors, acknowledge that with some vendors (not all) there is a quid pro quo. Build capital with your trusted vendors to use when you need something from them.
- Staffing Issues & Education
- Finding and retaining talent were a major concern for respondents. With an increasing number of restaurants opening, the pace of change at which turnover occurs is becoming a salient issue. Addressing this issue has required paying more for qualified candidates, offering perks, as well as having to more actively manage staff careers.
- Some of this career training has had to focus specifically on “business and administrative” training, including managing budgets, costs and P&L work. Having to teach the notion that wine programs are only part “art” and is in fact a large part of a “business” to younger and less experience staff.
- Multi-tasking & Time-management Juggling priorities, as the role entails demands from staff, customers and vendors, managing the financial and logistical aspects of the program, and time on the floor.
- Change The pace of change is increasing with staff migrating with greater frequency. This shift in pace is just the course of life–accepting it by embracing new communications styles, paths, systems or tools are critical to survival.
[Michelin participants added] Pricing How to price your wine list? A strategy most commonly used is to price a well known brand that customers will recognize at a lower mark-up and have a higher mark-up for other less well known brands.
Question #2 What practices or processes do you employ managing your beverage program that you think are particularly successful?
Responses to this question fell into three general categories:
- Staff Education. Many cited the importance of investing the time/effort in training the team, motivating and incentivizing them to succeed in their both their career development and salesmanship. Some methods cited to achieve this end include holding practical training during lineups, utilizing peers as trainers, and putting together wine collateral for easy study (a “Beverage Bible”).
- Control Measures. Controlling a program’s cost were a key concern and success-factor voiced by respondents. Some measures include processes to control access to inventory (“no ticket, no wine”), reviewing inventory daily to ensure proper accounting, continual staff training on pouring to minimize variance, and incorporating comps/voids into inventory accounting measures.
[Michelin participants added] Managing a cellar of vertical or trophy wines These wines tend to have a lower mark-up and will increase your overall cost percentage, but yields more cash and ultimately, cash is king. A solution brought up by a few BinWise user participants is to manage that inventory and cost percentage separately–which is made somewhat easier if you use BinWise, but a lot more work when you are not. Regardless of managing a separate inventory or not, it is important to be able to effectively communicate with your accountant.
3. Technology. Several respondents cited the integration of technology into their program management as a method of optimizing operations. BinWise (thanks everyone!) was one component of program management. Other collaborative tools (Google Sheets/Docs) were also cited as being key components of solid communications between team members.
[Michelin participants added] Technology has major impacts on customer behavior. Customers can now use their smartphones to check the cost and suggest that your mark-up is too high. One strategy to answer that question is to remind customers that some wines are highly allocated or that your relationship with vendors is the only way to get these highly allocated wines.
Question #3. How challenging is staff turnover for your program? Interestingly, nearly 60% of respondents felt that staff turnover had little to no impact on how they ran the program. However, a correlation was noted between staff turnover not being an issue with the investment in staff training and continuing education through the Guild of Sommelier.
Question #4 How important is wine education in the workplace as a strategic objective for your program? Unsurprisingly, almost all respondents felt that wine education was a critical component of their beverage program’s success – 83% of respondents indicated that their restaurants featured a formal education program for their staff.
In general, educational programs were inclusive, with almost all frontline staff included. Rates of inclusivity for management (GM/AGM) were markedly lower.
20% of respondents indicated that education programs were run once a month, while 60% held sessions more than once a month.
Our Last Question: If you could give advice to someone just starting out in a Beverage Management career, what should you tell them they should do? What should they avoid at all costs?
- Start with a good business foundation and pay attention to the financial details. A beverage program is a business – It’s not just about managing costs, it’s about managing sales and bottom line.
- A wine program isn’t about yourself: it’s about the vision of the restaurant and the wants of the customers and ensuring that those needs are met – like engaging a customer into buying something new.
- Your career’s success is dependent on being both an attentive apprentice and generous mentor. Seek out mentors from whom you can learn the ropes, be generous with your knowledge with others and lead by example.
- Be nice to your vendors. They are not your friends, nor your enemies, but trusted business partners. Respect pays dividends.
- “Don’t go hipster” (LOL) chasing trends can be a fool’s errand.
- And, voiced by many respondents: Be Humble.
Additional best practices and topics of discussion shared by Michelin Participants:
Subtly manage your by-the-glass pours – customize your logo on stemware, so the top of the logo for each type of stemware = 5 ounce pour. It helps your bar-staff with consistency without sacrificing style.
Wine pairing programs. It can streamline operations, but communication with the kitchen and chef is key to ensure that you can alter pairings if dishes change on the fly. If you have an extensive wine-pairing program, should you eliminate your by-the-glass list and replace with bigger pours from the pairing list?
Trophy wines served by-the-glass, is it worth it? With new technology, the Coravin, our Michelin participants concluded that it is. It gives customers an opportunity to try a wine that they may not spend hundreds or thousands of dollars for. And in some instances, the bottle is worth the money and the customer end up buying the bottle after all.
A special thanks to the following Michelin Guide Participants represented by chefs, wine directors and Sommeliers.
|Acquerello||Intercontinental San Francisco / Luce Restaurant|
|Alinea Restaurant||Kin Khao|
|All Spice||Longman And Eagle|
|Atelier Crenn||Masa Restaurants|
|Commonwealth||The Plumed Horse Restaurant|
|Delaware And Hudson|
BinWise also extends a warm thank you to The Napa Valley Vintners Association and The Michelin Guide for including us in this inaugural event. Click here to read more about the inaugural Michelin Guide Napa Valley Summit held on Sept 11 – 13.
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