How to Build a Financially Successful Drinks Program

Panelists at SommCon in Washington, D.C., share their tips for building a balanced beverage concept—and maximizing profitability

From left to right: Erik Segelbaum, Eugénio Jardim, Gretchen Thomas, Winn Roberton, Casper Rice, and Geoff Labitzke. Photo by Julie Case.

From June 23 to 25, SommCon took place in Washington, D.C. The conference offered wine professionals a dynamic series of tastings, training, and education sessions at The Westin Georgetown. On Sunday afternoon, a panel of beverage program operators and industry leaders convened to discuss all facets of revenue generation, profitability, and operations, zeroing in on everything from managing the cost of goods sold to maximizing profitability.

“You would be amazed at how many people don’t know how to positively impact revenue,” said Erik Segelbaum, the session’s chair. A former corporate beverage and wine director for Starr Restaurants who is now the Washington, D.C.–based principal of the wine consulting business Somlyay, he noted that beverage directors should serve the guest’s and establishment’s needs rather than their own.

“As sommeliers,” said Segelbaum, “we are emissaries of hospitality, always, but our actual job is not to learn about wine, talk about wine, and sell wine. The job of a sommelier is to sometimes build, and always to operate, a financially viable, profitable, well-controlled, well-organized, well-balanced beverage program that fits the needs of the operators—the people paying for your inventory and your salary; secondarily, to have a well-trained staff, because nobody can impact every single interaction; and, if there’s time, to learn about wine, study wine, and talk about wine.”

Understand the Program

To create a successful beverage program, it’s important to know what the restaurant and program is really all about. “Know the ethos of your program,” said Segelbaum. “And it doesn’t have to be noble. Have an identity—even if your ethos is a fast-casual spot designed to make a lot of money.”

Though an establishment’s food menu, philosophy, and location may all factor into the mind-set behind a beverage program, additional influential elements are at play. “The other thing you should consider when thinking about revenue is the type of staff your brand attracts,” said Gretchen Thomas, the New York City–based vice president of beverage for Del Frisco’s Restaurant Group, which is headquartered in Irving, Texas. For example, the people who want to work at Bartaco, the group’s Nashville-based restaurant, which serves upscale, beach-inspired street food, are usually between 18 and 21 and love the fast-casual, cool scene. Because of the staff’s general age, Thomas said, a wine program is hard to execute.

“Something I learned came by watching how hard it is for someone who is 18 years old to open a bottle of wine, because they’ve never done it before,” she said. “Our wine sales didn’t really support training the waitstaff on uncorking bottles, so we decided to make the entire wine program screw cap.” For Bartaco’s beverage program to be successful, Thomas needed to consider the staff as well.

The panel also argued for going beyond by-the-glass and by-the-bottle approaches as a means of increasing revenue—depending on what works best for a particular program. Segelbaum advocated for a program with large-format bottles and for listing those bottles both at the front of the menu and also within their respective categories. 

Winn Roberton, the head sommelier at Bourbon Steak in D.C., uses Coravin to create a robust glass-pour program. Meanwhile, Thomas explained that even smaller pours—specifically, half glasses—allow customers to explore wines at Barcelona Wine Bar, which has locations in Connecticut, Georgia, Massachusetts, Tennessee, Pennsylvania, Virginia, and Washington, D.C. But, she argued, it’s not a program that fits with every restaurant, and some establishments may actually benefit from larger pours. “If you’re the kind of place that’s transactional,” she said, “or [has a] heavy lunch, or a place where people are going to have only one glass, offer a larger size. You’d be amazed at how many people will take the nine-ounce pour over the six-ounce pour if offered.” 

Pay Attention to Logistics

Menus themselves can be an effective sales tool if they’re organized strategically. The panel noted that well-written lists can substitute for a sommelier, to some extent, when floor staff aren’t knowledgeable enough to sell wine or are simply overwhelmed. Though strategies for menu organization vary, all of the panelists agreed that the critical element was legibility and consistency. 

“You want to sell it? Make sure they can read it,” said Eugenio Jardim, a San Francisco–based wine consultant and the U.S. ambassador for Wines of Portugal. Another essential for menus is proofreading. If guests can’t see that a menu is typo free, they most likely won’t trust that the vintages are accurate or even that the cellar stores wines properly.

Though the mechanics of goods and cost controls, such as understanding inventory, budgets, and accounts receivable, are not the most interesting responsibilities of a beverage director, they are necessary elements to monitor in order to manage a profitable program. In more than 15 years, Segelbaum says he has never had a week where every single invoice was correct. 

“If you’re operating your program correctly, you’re holding your vendors accountable,” he said. “You need to be paying attention.” While an extra 30 cents per bottle might not seem like a lot initially, multiply that by many cases and the difference adds up. Soon the restaurant may be bleeding money by a million tiny cuts.

Advice for Suppliers

The panel closed with a conversation on the importance of vendor relationships—not just to maximize revenue but to develop meaningful partnerships that go beyond transactional exchanges. The panelists also offered some advice to suppliers and distributors: Giving restaurant buyers the tools they need to do their jobs will help them save time, with suppliers and distributors making more money in the end.

For suppliers and distributors trying to crack an account, a little reconnaissance can go a long way. “Just go sit at the bar and observe the restaurant,” said Geoff Labitzke, the director of sales for Kistler Vineyards in Sebastopol, California. “Look at the clientele, look at the list, the by-the-glass program. That will tell you loads about how the buyer operates and how the account—restaurant or retail—operates.”

Attendees also had questions about what suppliers can do to make buyers happy. “Do your homework,” said Jardim. “Show up knowing what I’m about—what my style is, what my menu is like, what my prices are.”

“I don’t need gifts to get that first meeting,” said Thomas, who also reminded buyers to be respectful of their suppliers. Among other reasons, she said, when it comes time to move on, those suppliers are sources of industry intel and may know where jobs are opening up. By working together, suppliers and buyers can drive revenue for the wine industry as a whole.


Sign up for our award-winning newsletter

Don’t miss the latest drinks industry news and insights—delivered to your inbox every week.

When she’s not writing about beverage, travel, or weird science, Julie H. Case can be found deep in America’s forests, foraging for mushrooms.

Most Recent