Increasing the Profitability of      Your Wines By The Glass                    Program     Nick Moezidis, Vice President,...
Presentation Overview   Napa Technology   Evolution of Wines By The Glass   Buy the Glass – market Value   Consumer ex...
Who is Napa Technology            Developed in Silicon Valley, Napa Technology is the            designer and manufacturer...
Napa Technology NationalPartnerships
   $27.8 billion 2011 total wine sales     43.8% account for on-premise sales     3% increase over 2010     Beverage I...
Value to your Venuethis year’s Napa Technology Wines By The Glass Surveyunearthed a few facts and figures that you may fin...
Consumer Expectations &Consumption Patterns  Our research revealed that 86% of respondents believe that their customers a...
Waste not –profits lost by the ounce The daunting truth is that with this fragile commodity on the rise – Spoilage, theft ...
Waste not – profits lost by the ounce  Looking at both ends of the spectrum; a national casual  chain restaurant like The ...
Operational changes thatincrease profits1. Be in the know    Although you, or your beverage director or sommelier is    m...
Operational changes that increase profits4. Pristine = Profits; Put a cork in your sales losses    Today’s wine consumer ...
Ten immediate changes ToImprove Profits1. Show Off      24% of wine consumers cite examining a wine list       online bef...
Ten immediate changes toImprove Profits4. When Less is more     Although wine lists have become broader and more       ex...
Ten immediate changes toimprove profits7. Honey, didn’t we buy that at the Wine Shop?       In a cyclical trend that enco...
Ten immediate changes toimprove profits10. Tell me, Sell Me      The number one most influential element in driving      ...
Improve profits through staffeducationKnowledge is power      Utilize online, free wine apps and supplier/distributor    ...
Thank You       Please Join Us   For our Next Webinar:      Effectively Creating ATry Before You Buy Program at Your      ...
Napa Technology Seminar:  Increasing Profits With Wines By The Glass
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Napa Technology Seminar: Increasing Profits With Wines By The Glass

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For any restaurant or retailer who sells wines by the glass, squeezing out profit on each wine bottle is critical to success. This presentation is great for food and beverage managers who are responsible for profit and loss. This slide presentation on increasing wine profit provides tips and how tos to achieve maximum value out of each bottle.

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  • Thank you Nick – I’ll keep the ball rolling in regards to what we know about WBG trends, as we just recently concluded our 2012 study. What we found is that WBG is rapidly evolving and taking shape to be a significant part of an operators profits. Let’s look at a few of the highlights: First 75% of all respondents noted, that despite a mildly improving economy – that they saw an increase in sales over last year. A large margin – 43% saw sales improve 11-25%. While 10 percent of our participants noted sales increases of 25% or more. In large, the fine dining segment still leads the charge with 70% of total beverage sales belonging to wines by the glass. Additionally, operators saw significant rises in the per glass price, with the average between $11 and 15 dollars – yet a quarter of those researched showed pricing to be 26 dollars and up. Finally, 15% of operators polled shared that the half glass option made it’s way to the menu this past year.
  • It’s no secret that the wine drinker is getting smarter – we saw an 11% uptick in those that thought so over last years research results. What is of greater interest is that consumers today are not only aware of oxidize wine- but 52% say they can identify it when dining out. Additionally, sampling has become the new norm with 85% of respondents stating that consumers are now requesting a taste for wines by the glass selections. Guests today are savvier, more aware of their product and not bashful about assuring that they’re getting the most for their money.
  • Waste, theft and spoilage are common every day obstacles that operators face. However, the amount of loss found behind the bar is staggering and when evaluating the average losses for a year – an operator could just as easily purchase a new walk-in cooler with the amount of profits lost to the glass. The highest losses, according to Beverage Information Services are within “Call Brands” of spirits averaging about 10% lost to waste and theft. However, this same group identifies the losses in wine to be even higher – and with greater margins, tilting the scales at nearly 11-15% in total waste and loss. Let’s take a look at the numbers and do a little math.
  • Thank you Nick – so now that we’ve explored cost saving operational tactics – let’s turn our focus on a single entity within your restaurant that impacts 100% of sales – your menu. With your menu – show off and share. With 25% of consumers examining a wine list online before visiting a venue – keeping it active, current and NOT a secret is key to your success. Almost your entire consumer base, is going to see, touch or read your food menu – don’t over look the opportunity to weave your wine offerings into the pages with discriptive pairings to help your guest better navigate their experience. As we mentioned earlier – half glass options are on the rise. Why? Because they are profitable. Operators that added the half glass option to their wines by the glass offerings saw a 75% increase in overall sales. Don’t be afraid of downsizing – see the half glass as an add on to the experience.
  • Nick had mentioned earlier that today’s norm is somewhere between 25 to 30 selections on a wines by the glass list. However, don’t over look the need create a list that provides a well balanced number of recognizable brands. 25% of guests surveyed, cite being intimidated by vast menu offerings – so help them out and keep your list within in reason and appealing to your guests. Also, don’t be afraid to go big. Our research has shown clearly the consumers are willing to buy by the glass what they wouldn’t otherwise buy by the bottle. Speaking of the bottle –let’s not kick this option to the curb either. Keep your wine list compelling by offering a well balanced number of selections under $50 a bottle.
  • As Nick mentioned at the beginning of this presentation – consumers buying habits at the table are influenced by what they are seeking in the aisles. So operators beware – and be cautious of excessive up charges on popular brands. Speaking of charges – it looks like consumers are putt off by the dollar sign. Furthermore, they feel they are being “fooled” when items are priced at odd or non-rounded numbers. Keep your menu simple – and you’ll keep your menu profitable. Wines by the glass offerings today are a strong point of competitive diversity. So assure your wine program is complimentary to your consumer base, properly priced – and diverse enough to keep your guests returning with frequency.
  • And finally – the single most influential element to driving positive sales inside your four walls is a well educated service staff. Twenty eight percent of guests cite choosing a higher priced wine when a server assisted in making a selection. However overselling can also backfire – keep the sales pitch to 5 wines or less. So how do we properly train the sales team – here are a few good tips
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  • Napa Technology Seminar: Increasing Profits With Wines By The Glass

    1. 1. Increasing the Profitability of Your Wines By The Glass Program Nick Moezidis, Vice President, Sales & MarketingJayne Portnoy, Vice President Marketing & Brand Strategy
    2. 2. Presentation Overview Napa Technology Evolution of Wines By The Glass Buy the Glass – market Value Consumer expectations & Operational Pitfalls Actionable Operations and Marketing Tactics.
    3. 3. Who is Napa Technology Developed in Silicon Valley, Napa Technology is the designer and manufacturer of the WineStation ®, an innovative Intelligent Dispensing and Preservation solution for the hospitality and entertainment industries. First introduced in 2005, the WineStation ® now pours nearly 3 million ounces of wine per month from its systems serving restaurants, hotels, cruise ships, arenas, airports, wines bars, grocery stores and retailers worldwide. This far reaching presence, coupled with a commitment to on going research, Napa Technology can identify and provide insights on industry trends and changes in consumer behavior and consumption patterns.
    4. 4. Napa Technology NationalPartnerships
    5. 5.  $27.8 billion 2011 total wine sales  43.8% account for on-premise sales  3% increase over 2010  Beverage Information Services the wine industry is predicted to reach 317.3 million cases by the end of 2012.  U.S. wine consumption forecasted to surpasses France in 5yrs. Wine By the Glass Menus avg 25 offerings  High end varietals account for 10% of WBTG offerings  86% of industry experts claim guests will choose a high priced glass over bottle when available.  WBTG pricing has risen by 15% in the last 3 yrs.
    6. 6. Value to your Venuethis year’s Napa Technology Wines By The Glass Surveyunearthed a few facts and figures that you may find rathertelling, for an industry that reported over 13 billion inon-premise sales, for which direction this trend is headed: 75% of respondents cited in increase in WBTG sales over last year  43% of respondents report increases between 11- 25%. 10% have experienced increases over 25%.  On average, wine sales account for nearly 70% of total beverage sales in fine dining venues.  The per glass price averages between $11-15  25% respondents reporting $26-30+ pricing. 15% of respondents added the half glass option to their menu within the last year
    7. 7. Consumer Expectations &Consumption Patterns  Our research revealed that 86% of respondents believe that their customers are far savvier about wine  up 11% from last year. 52% of respondents Report that their customers are able to identify a corked/spoiled wine.  sampling is no longer a standard for just bottle purchases  85% of respondents cite sampling occurring with wine by the glass selections.
    8. 8. Waste not –profits lost by the ounce The daunting truth is that with this fragile commodity on the rise – Spoilage, theft and loss continue to gouge operators of Wine’s full profit potential. According to Beverage Information Services, the largest loss in volume behind the bar is in the “call” spirit brands. However the largest margin is lost in the glass of wine. Blended averages showcase an average loss of nearly10% in total beverage sales. • Beverage Information Services has found wine sales tilt the scales in the 11-15% range.
    9. 9. Waste not – profits lost by the ounce Looking at both ends of the spectrum; a national casual chain restaurant like The Cheesecake Factory (PPA of $25), sells staggering volumes nearing 1000 glasses of wine a month, nearing levels similar to their fine dining peers, as Roy’s Hawaiian Fusion Cuisine (PPA $75) reports selling between 1,500-2000 glasses a month. Independent operators report sales volumes ranging from 700-1,200 glasses a month. So let’s take a look at what these losses look like to the bottom line: An establishment that serves 780* glasses a month at an average of $11 per glass = $8580 in sales Average Losses to Spoilage/Theft at a modest 10% = $858 Average Annual Loss = $10,300 *30 glasses a day x 26 days
    10. 10. Operational changes thatincrease profits1. Be in the know Although you, or your beverage director or sommelier is making the selections for your wines by the glass list –it’s your service team that has to sell it. Free wine apps, websites and supplier/distributor training is readily available. Assure your team is a powerful tool in driving sales.2. Does that varietal look good on you? Consumers today not only don’t like to guess when they are making purchases – they don’t have to. Sampling in both retail and restaurants has become the norm to support and encourage increased sales.3. Make half a whole Consumers are splurging on small doses and the advent of the half glass provides the freedom and encourages them to splurge on higher priced wines. Use half glass offerings as a means to compliment small plates/tapas, create wine flights
    11. 11. Operational changes that increase profits4. Pristine = Profits; Put a cork in your sales losses Today’s wine consumer more savvy on what to look for in a good glass of wine hence visible corks in bottles often raise questions of how long a bottle has been open Spoilage and waste are significant detriments to profitability. Optimize your profits by utilizing effective preservation techniques that enhance a bottle’s shelf life allow for eradication of waste on your most volatile, costly products behind the bar4. Too Hot, Too Cold – Too Bad Wine served at the wrong temp not only tastes bad, it’s bad for sales. Over chilled white wines will over power any chef’s creation and ruin a meal. A too warm room cooks the red wine and ruins the experience and actually will fill your guest more quickly.4. Operate on Auto(mated) Technology has provided so many advances in operations and it does translate to profits behind the bar. Today’s technology is replacing glass markers with
    12. 12. Ten immediate changes ToImprove Profits1. Show Off  24% of wine consumers cite examining a wine list online before visiting a restaurant.  With mobile and smart phones readily available assure today’s consumer can find your current and accurate wine list on your website.2. Use your Most Valuable Real Estate – Your Menu  Cleverly weaving wine offerings into the food menu is proven to increase overall wine sales by 10%.  Descriptive wine notes and pairings are instrumental in communicating both your selections as well as helping the guest best navigate their experience.3. I’ll Take Half Please  A growing and effective trend is to offer 2-3oz offerings to the WBTG menu. When doing so, operators saw a 47% increase in total sales Wine List USA
    13. 13. Ten immediate changes toImprove Profits4. When Less is more  Although wine lists have become broader and more expansive, assure that your wine list still provides well-known respected brands.  25% of respondents cited being intimidated by vast menu offerings when left to their own devices to make a selection.5. Go big – Offer the Reserves  Finer wine selections ($15+) have seen a dramatic rise in the last 5 years. Appeal to the guests that are willing to splurge in small doses by allowing for 5% of your menu to be in a premium price range.6. Don’t Forget the Bottle  As wine lists become more intriguing, don’t cut off your bottle to spite your glass, and provide a compelling number of selections under $50 a bottle.
    14. 14. Ten immediate changes toimprove profits7. Honey, didn’t we buy that at the Wine Shop?  In a cyclical trend that encourages consumers to experience new wines at restaurants and seek them in retail, can also leave a bad taste in ones mouth. Be cautious of excessive up-charges on largely popular brands.8. $ Signs = Less Sales  According to Cornell’s Center for Hospitality Research, dollar signs and un-rounded price points (ie $12.50 v 13) are off-putting to guests and leads to a decline in overall sales.9. When More is Good  Today, the average number of wines by the glass selections is 23-29. And this isn’t just for fine dining. Consumers are looking for offerings with depth and diversity.
    15. 15. Ten immediate changes toimprove profits10. Tell me, Sell Me  The number one most influential element in driving positive wines by the glass sales lies in the hands of your service staff.  28% of respondents cite choosing higher priced wines when a server made a selection.  Be cautious of overkill – like any salesman – the guest will only be receptive to 5 or fewer recommendations and/or Special Features.
    16. 16. Improve profits through staffeducationKnowledge is power  Utilize online, free wine apps and supplier/distributor supplied materials to further educate your staff.  Let your staff sample wine pairings & featured selections prior to their shift so they are familiar with the varietals.Keep Good Notes  Suggesting wines is virtually impossible if your service staff doesn’t know what the wines taste like.  Prepare daily tasting notes for your staff.  Utilize technology such as LCD screens found on Preservation systems like the WineStation.Vino University  Assure your staff knows what an oxidized/corked glass of wine tastes/smells like to avoid serving.  Proper temps are key to the overall dining experience – make sure your wines are held and served at proper temps.
    17. 17. Thank You Please Join Us For our Next Webinar: Effectively Creating ATry Before You Buy Program at Your Retail or Grocery Store Visit NapaTechnology.com for details

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