Many restaurants will allow guests to bring in their own bottle of wine to drink tableside for a standard corkage fee. While this isn’t a typical request, it is a common practice among wine enthusiasts who have their own collection of curated wines or guests who are celebrating a special occasion and want to uncork a special bottle of wine that isn’t listed on the menu. There are some definite pros and cons to permitting BYOB, including profiting from corkage fees. Keep reading to learn more about this practice and whether corkage fees are the right choice for your establishment.
Why Restaurants Charge Corkage Fees
There are several different reasons why guests may be permitted and even encouraged to bring their own wine.
You haven’t developed a beverage program yet.
Your restaurant has opened a bar and secured a liquor license but is still working on putting together a wine list and beverage program. There are some situations where restaurants have put the time, effort, and money into applying for securing a license to serve and sell alcohol, but it may not be a part of the menu yet. Allowing BYOB and charging a corkage fee means that guests can enjoy a full dining experience and the restaurant can generate more revenue.
Your establishment doesn’t have a drink menu.
If you don’t serve alcohol, but it is legal for customers to drink on-premise, you may consider allowing BYOB wine. The corkage fee will help cover the cost of labor for servers who actually pour the drinks.
You operate a restaurant that caters to guests celebrating special occasions.
A couple celebrating an anniversary may want to open a bottle of wine they bought on a special trip or were gifted at their wedding. Allowing this is a great way to build relationships with guests and still earn revenue.
How are Corkage Fees Determined?
Some cursory research will reveal that corkage fees tend to vary widely. In general, the fees are in line with the type of establishment and level of service. For example, guests can expect to pay more at high-end restaurants with expensive glassware, an extensive wine list, and professional sommeliers. At more casual restaurants where guests may end up opening and pouring their own wine, the corkage fee will be much lower.
How Much Should I Charge for Corkage?
As a general rule of thumb, corkage fees fall in the $10-40 range, with $20 to $25 being the most common charge. Perhaps the biggest influence on the going rate is location. In Manhattan, corkage fees at fine dining establishments can reach $85 and super-exclusive restaurants may charge over $400. In addition, some restaurants’ corkage fees will depend on the age of the wine. Older vintages will come with a higher fee, which can help to increase the overall check size.
Waiving a Corkage Fee
There are certain circumstances when restaurant management may decide to waive corkage fees. For example, it is common for restaurants to waive the fee if the guests bring their own bottle and order a bottle off the menu. Offering a weekly $0 BYOB night can also be a great promotional marketing tool. Just be sure that you understand corkage fee laws in your state. You may live in an area that doesn’t allow any alcohol to be consumed on-premise without a liquor license.
The Pros and Cons of Offering BYOB
If you are having trouble deciding whether offering BYOB and charging corkage fees is the right choice for you, here are some pros and cons to consider.
- Customers can enjoy a drink even though you don’t have a wine list.
- It allows customers to celebrate a special occasion. What would have simply been a meal can be transformed into a full experience when guests are able to enjoy a bottle of wine that has meaning to them.
- Allowing BYOB is a good way to keep up with the competition in your area. You don’t want to get left behind by being the only restaurant that doesn’t offer BYOB.
- Potential for lost restaurant profits. For restaurants that sell alcohol, which comes with a significant markup, BYOB practices can eat away at revenue. However, corkage fees will help make up for some of this loss.
- Intoxicated diners. People may indulge a little more than usual when they are drinking their own wine. This can lead to intoxicated guests and be a liability to businesses. Servers should be trained to identify signs of intoxication, especially at more suburban restaurants where guests have to drive to the location. You may even consider setting drink limits to avoid problems.
- Slower turnover. Guests who order wine off the menu may only have one glass and leave when they have finished their meal. Those who are sharing a bottle tend to take their time and continue to sip on their drinks after the plates have been cleared. This can slow down table turnover rates and cause profit losses.
While corkage fees are a common practice, BYOB wine might not be the best choice for every restaurant. When deciding whether to undertake this practice, start by understanding the corkage laws in your state. Next, consider how much you will be able to charge in corkage fees according to your location and type of establishment. This figure will help you weigh the pros and cons and better understand the potential impact of implementing this pricing structure.
What is a corkage fee?
Guests pay a corkage fee at a restaurant when they bring their own bottle of wine to drink with their meal.
Why do restaurants charge a corkage fee?
The corkage fee helps recoup some of the revenue lost from customers who don’t order off the restaurant’s wine list and covers the cost of labor involved in serving the wine.
Why is corkage so expensive?
Corkage fees vary based on location and the type of restaurant. Exclusive restaurants in NYC can charge more than a more casual establishment in the suburbs. The cost reflects the type of service.
How much should you charge for corkage?
The average corkage fee ranges from $10-40 per bottle. This is a good place to start when it comes to pricing.
When might you waive a corkage fee?
You should consider waiving the corkage fee when the guests both bring their own bottle and purchase one at the restaurant. Waiving the fee on certain nights or for specific types of wine can also be used as a promotional tool.