You’ve seen it happen before. Someone at the table grabs the wine list, eyes scanning nervously, then lands on that second least expensive bottle. It feels safe, right? Not too cheap, not breaking the bank. Like some unspoken rule of restaurant etiquette whispered through generations. Yet here’s the thing, and this might surprise you: industry professionals have been quietly shaking their heads at this approach for years now.
The whole idea started gaining traction back around 2012, when a comedy sketch planted the seed that the second-cheapest wine was your best bet. People don’t want to look cheap, so they order the second cheapest wine, according to behavioral psychology observations. The logic seemed sound on the surface. Restaurants must know that nobody wants to order the absolute cheapest bottle, so naturally they’d exploit that second slot with maximum markup and mediocre quality. Except the reality is far more nuanced than that old piece of advice suggests.
The Psychology Behind Our Wine Choices
Let’s be real about what happens when that wine list arrives. There’s pressure, maybe from your dining companions or just yourself. You want to appear sophisticated but also value-conscious. A study commissioned by the Wine and Spirits Education Trust shows that 19% of the British drinkers tend to implement that strategy when choosing wine at restaurant. Nearly one in five people follow this rule without questioning it.
Restaurants absolutely understand this behavior. Some savvy wine directors have even started using it to their advantage, though perhaps not the way you’d expect. There’s an old bit of restaurant wisdom that states that you should order the second least expensive wine on the wine list, yet sommeliers would flip flop wine prices to take advantage of people who subscribed to that bit of folklore, juggling prices at the lower tier to encourage sales of a wine that wasn’t moving. The game isn’t always what it seems.
The Markup Reality Check
Here’s where things get interesting. The industry standard is to mark up a bottle of wine 200-300% over its retail sales price, meaning if a high-end wine retails for $20 at a wine store, it typically sells for $60 to $80 at a restaurant, though for rare, expensive, or specialty wines, the markups can reach as high as 400%. That’s just how restaurants survive.
The shocking part? The second-cheapest wine doesn’t necessarily carry the worst markup. Some research suggests that the markup on the second-cheapest wine is actually far below that of the next four more expensive wines. This completely flips the conventional wisdom on its head. Restaurants often use graduated pricing structures where cheaper bottles get hit with higher percentage markups, while pricier selections see lower percentages but higher absolute dollar profits.
What Sommeliers Actually Put in That Second Slot
Now this is where it gets genuinely fascinating. Some restaurants want to get their diners to try interesting wines that will bring them back again and again and so they price them on the low side to induce otherwise cautious diners to sample them, sometimes even intentionally making them the second-cheapest wine because they think some of their customers won’t be able to resist the bait.
In other words, certain wine professionals use that psychological sweet spot to introduce you to something unexpected. A lesser-known varietal from an obscure region, priced attractively to move inventory and build loyalty. The lower-priced bottles are a way of gauging the mind-set of the sommelier or of showing what kind of wine he or she likes. It’s almost like a calling card.
The Graduated Pricing Strategy Nobody Talks About
Honestly, most diners have no clue that wine pricing in restaurants follows a sliding scale. Most lists follow a graduated markup, with the highest markups on the cheapest wines, and lower markups on higher-end wines, where a ten dollar wholesale wine may be marked up to thirty dollars, but a fifty dollar wine might be just eighty dollars.
This changes everything about how you should approach the list. After a forty to fifty dollar per bottle profit, restaurants will start to work in an unspoken partnership with the more knowledgeable and adventurous wine enthusiast, using a graduated scale mark-up which goes down as the bottle wholesale price goes up. Translation? The further up the list you go, the better value you’re actually getting relative to retail prices.
Entry-Level Prices Are Climbing
Think back to dining out in 2016. When Punch surveyed New York City wine buyers back in 2016, it was common for bottle prices on restaurants’ lists to begin in the thirty dollar range, but when a similar research expedition was undertaken in May 2024, the price of entry was roughly double. Sixty dollars has become the new baseline in major metropolitan areas.
That shift reflects more than just restaurant greed. Those price bumps are not just about markups but about marginal increases at every level of the production and distribution chain, from the cost of oak barrels and glass bottles to label printing, shipping, storage, and at-cost distribution rates. Everything costs more, so naturally the cheapest options have moved up the ladder.
The Cheapest Wine Might Actually Be Better
Here’s something that’ll mess with your assumptions. If you are on a budget, don’t be afraid of the cheapest wine, because the sommelier put it there for a reason, especially if it’s an esoteric wine variety, as sometimes the cheapest wine is better than the second cheapest wine.
Many sommeliers take pride in their entry-level selections. Most of the sommeliers professionals know are proudest of the wines that are the least expensive on their wine lists, because anyone can assemble a wine list of great wines where the average price is one hundred fifty dollars, but discovering an exceptional wine that you can sell for forty dollars takes an astute palate and perseverance. It’s actually harder to find great value than it is to stock expensive cult bottles.
The Restaurant’s Real Moneymaker
Want to know why wine matters so much to restaurants? Wine achieves a 70% profit margin, making it one of the most profitable categories on the menu, which becomes essential when you consider that the average restaurant profit margin typically falls between 3-5%, with food costs alone accounting for approximately 28-35% of total revenue.
Wine literally keeps restaurants afloat. While a pasta dish might generate only a marginal profit margin after ingredient and labor costs, that same table’s wine selection can contribute significantly more to the bottom line. Your pasta funds the chef’s salary. Your Chianti funds pretty much everything else.
What to Do Instead of Following the Rule
Industry experts recommend communication as a one-word rule of thumb when it comes to restaurant wine: when in doubt, start a conversation, talking about what you’d like to eat, like to drink, prefer to pay and challenging your server or sommelier to help find the right wine. Revolutionary concept, actually talking to the professional standing right there.
One of the tools sommeliers use to put people at ease is finding out what their max budget is and coming in just under it, so if told the max is three hundred dollars, they’ll usually pick a wine around two hundred fifty dollars. They’re not trying to upsell you into bankruptcy. They genuinely want you to have a great experience.
The Secret Sommelier Trick for Finding Value
Ready for insider knowledge? Sommeliers suggest you should always choose the wine with the longest name you can’t pronounce, because if you can’t pronounce it, you probably won’t order it and it’s unlikely that other people will order it. That obscure bottle from an unfamiliar region? It’s sitting there precisely because the sommelier believes in it but knows it’s a hard sell.
Those wines often represent the best value on the list. Good sommeliers will drop the price of a less familiar wine like a Xinomavro to encourage people to try it, so in this case, it’s best to just ask the sommelier what’s best. They’ve essentially created a treasure hunt on their own list.
The By-the-Glass Gambit
Here’s another angle worth considering. By-the-glass wines are huge revenue drivers in a restaurant with higher markup than by-the-bottle wines, and sommeliers know that guests flock toward familiar grapes like Sauvignon Blanc and Pinot Noir, so if a sommelier includes an oddball grape or region on the by-the-glass list, chances are they particularly love it, with oddball grapes typically offering better bang for your buck.
The by-the-glass section often hides the most passionate recommendations. The most basic approach is to price each glass at the wholesale cost of the entire bottle, so if a restaurant pays fifteen dollars wholesale for a bottle, they’ll typically charge fifteen dollars per glass, assuming restaurants will pour 4-5 glasses per bottle. Four glasses and they’ve already made their money back.
