Don’t be surprised if it’s easier this month to get a reservation at Smith & Wollensky.

The reason: With the economy in decline and expense accounts under increased scrutiny, businesspeople may be skipping the steakhouse–and the overpriced wines that flow there.

That appears to be what’s happening at Morton’s and Ruth’s Chris. In the last year, Morton’s stock has dropped 75%. Ruth’s Hospitality Group, which owns the Ruth’s Chris chain, has followed a nearly identical downward trajectory.

In Depth: Most and Least Pricey U.S. Steakhouse Wine Lists

“There are two major problems facing both of the steakhouse operators,” says Chris Armbruster, senior research analyst at Al Frank Asset Management. “First is general weakness in consumer spending due to less levels of disposable income and lower levels of confidence, even at the high end. The second is a decline in business spending on steak dinners. I believe corporations are gravitating to meetings and sales calls over the phone rather than over a $50 steak dinner.”

And that $50 is just for one steak–no appetizers, sides or dessert. Now throw in the wine.

Restaurants typically price their wines at roughly triple what they pay the wholesaler, but steakhouses often sell a bottle for as much as four times the wholesale price.

That’s exactly the sort of thing that happens at New York’s Del Frisco’s. There, dinner for two–a double porterhouse, plus two sides–costs about $135, not including appetizers, dessert, tax and tip. Along with that, a bottle of Jordan Cabernet Sauvignon 2004 from California’s Alexander Valley costs $150, “which is very high,” says David Gordon, the wine director behind the award-winning list at New York’s Tribeca Grill, and also an importer at New York-based David Bowler Wine. “That wine costs $40 a bottle, so that’s a four-times markup.”

Still, even in a down economy, deals are done. If a client wants to meet over meat, go for the steakhouse with a wine list that favors fairness over fleecing and provides enough variety to satisfy several tastes.

Big Markups

To get a better sense of which lists qualify, we recruited, along with Gordon, Tyler Colman, Ph.D., a Wines For The Weekend guest and author of the new book A Year Of Wine; and Natalie MacLean, the wine writer behind the blog Nat Decants and author of the book Red, White & Drunk All Over.

All three were provided wine lists from nine steakhouses, most of them chains with multiple U.S. and even some international locations (the exception being New York’s Peter Luger, which only has two locations). The Palm provided a list without prices.

Wherever possible, our panel was provided the steakhouses’ “core” lists. A chain might have a core wine list that’s 60% identical from location to location, with the balance chosen by the on-site beverage manager, who’s familiar with the local clientele’s preferences. Some steakhouses provided a list from a particular location, noting that it’s a fair representation, in terms of selection and price, of what a diner would find at any of that chain’s restaurants. The restaurants’ names were removed from each list before they were provided to our panel.

The lists, in general, had two things in common, our experts said. The first is the dominance of big, rich red wines, such as California cabernet sauvignon, with a lack of more subtle or lighter-bodied wines. Second, all three of our experts were quick to note the prices–almost universally over the top. The most egregious, the panel noted, was the list at Del Frisco’s. Cakebread cabernet, which wholesales for about $40, costs $175 there.

Best Bets

This list, though, is especially well-chosen, which comes at a price. In fact, our experts found that the most carefully selected lists also tend to be the most expensive. These include the lists at BLT Steak and Smith & Wollensky. Del Frisco’s has about 450 California cabernets, ranging in price from $44 to $5,000 (the average is around $400 per bottle); BLT steak offers more than 60 Italian reds ranging from $44 to $987 (average of $233 per bottle); and Smith & Wollensky has a collection of about 80 library wines that range from $113 to over $6,000 (averaging more than $500 per bottle). But all have hundreds of other selections as well, from multiple regions around the world.

Del Frisco’s has “the biggest list, the most selections, it has a lot of great wine on it. However, the pricing is the highest of anyone,” says Gordon. Looking at three particular Napa cabernets that appear on most of the lists, the prices were all quadruple markups at Del Frisco’s, he found. Along with the previously mentioned Jordan ($150), the 2001 Screaming Eagle from Napa is $4,000; at Gordon’s Tribeca Grill, it costs lest than half that at $1,800.

Gordon says, “$1,800 is ridiculous, too, but people do come in and buy it.”

Gordon, Colman and MacLean were impressed with the list at Smith & Wollensky, not for its depth of style but for its verticals (same wine, several different years available). This gives diners the option of choosing more mature wines. For example, there are eight vintages of Mayacamas cabernet from Napa, ranging from 1988 to 1997 (the cheapest is $228, the most expensive is $480).

Capital Grill earned praise for its mostly fair prices ($38 for a gruner veltliner, for example), as well as for its range of white wines. While the list has typical steakhouse cabernets, there are plenty of other selections as well, such as a dozen sauvignon blancs starting as low as $26. More than half the selection of Bordeaux wines are under $100 (starting at $29); the most expensive, the Ch√Ęteau Hosanna 1999, is $230.

But BLT Steak won over all our experts for its range of vintages and regions beyond California and Bordeaux. There’s Spanish wine, red Burgundies–even “Zweigelt, an unheralded red grape from Austria,” Colman points out.

MacLean called it “the wine list as Bible or telephone directory,” and while the prices are high, Gordon noted that they’re not in Del Frisco’s territory, and that the wide range of styles and varieties available makes up for the high costs. There are nearly 40 reds from France’s Burgundy region, including a few vintages of the rare and pricey Domaine de la Romanee-Conti, as well as about 30 Spanish wines from six regions, including a 1976 Lopez de Heredia for about $300.
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Similarly, all three experts noted the list at Fleming’s Prime, which orders its wines from lightest to heaviest to give diners a better sense of what they’re buying.
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“It emphasizes that they recognize that diversity,” says Colman, and none of the other panelists found the Fleming’s prices to be beyond the range of what’s normally acceptable at steakhouses.

Behind the Leaders

Two other lists that stood out for their high number of selections, if not a broad range of styles, were those at Ruth’s Chris and Morton’s. But the prices put off our experts. At the latter, a bottle of Dom Perignon, for example, is $326 (it’s less than that even at Del Frisco’s), and Cakebread cabernet from Napa is $161–most of the other lists have it for $150 or less.

“If the stock market ever recovers, this is the place to dine,” says MacLean of Morton’s.

Similarly, of the Morton’s list, Colman found one wine–the 75 Wine Co., Amber Knolls Vineyard cabernet from California–that retails for $20; it’s $80 on the wine list.

But a careful look at the list uncovers some values. For one, MacLean noted the strong by-the-glass selection, and both she and Colman pointed out the high number of selections by the half bottle–which cost half as much, of course. And there could be more values to come.

“Much more wine is being brought in for that $50-and-under price point, which is becoming more popular,” says Tylor Field, vice president of wines and spirits for Morton’s. He also says Morton’s is trying to create more values as the economy sags, in part by negotiating prices on large allotments of a particular wine, then selling it by the glass. “People want to have something great but don’t want to make an investment of $100 when they can make an investment of $16 and still have a great experience,” he says.

Ask any of the steakhouses’ beverage directors about their wine prices, however, and they’re quick to say that they don’t gouge, it’s their competitors that do.

“Well, I don’t think ours are [overpriced],” says Marian Jansen op de Haar, director of wine for Flemings, in response to a general question about why steakhouses overcharge for wine.

However, there’s a fair argument to be made that it isn’t the steakhouses’ fault for pricing wines the way they do–it’s the consumers’.

“People know these wines and chase after them,” says Fred Dexheimer, national beverage director for BLT. High consumer demand for well-known, cult-status Napa wines drives the wholesale prices up, and they get even higher at the steakhouse because “people are willing to pay,” he says.

Of other steakhouses,Dexheimer says, “the more you charge, in some cases, the more it sells. There are names out there that get certain guests excited, and they’re entertaining clients. A lot of it is impressing your guests and putting the tried-and-true, familiar [wine] on the table.”

But as the economy worsens, more steakhouses could make adjustments, as Morton’s has with its by-the-glass selection. Gordon thinks other steakhouses will follow suit, and find even more ways to offer value.

“A lot of the steakhouse business is expense-account business, and people’s expense accounts are scaled back,” he says. “They can’t order $300 wine each time [they] go out.”

Colman puts it more bluntly: “I don’t know how these guys are going to make it in this economy, to be perfectly honest.”

Morton’s

Highest bottle price (Lafite Rothschild 1999): $949

The verdict:

This wine list won over Colman and MacLean for its by-the-glass selection, as well as a solid list of half bottles. Gordon said it was one of the more fairly priced lists, even if it wasn’t anything special. But because only the core list was rated, different Morton’s locations should offer many more wines, chosen by the on-site beverage managers.

Smith & Wollensky

Highest bottle price (Screaming Eagle 2001): $6,150

The verdict:

All of our experts gave this list a passing grade for its verticals–certain brands of wines from different years. But the prices are high, and the list is dominated by full-bodied reds such as California cabernet. “I thought this one was solid,” said Colman; MacLean liked the offerings of mature wines rather than just recent releases.

Ruth’s Chris

Highest bottle price (Harlan Estate 1997): $2,529

The verdict:

MacLean says this list wins for its depth of California wines, but all three experts agree it was one of the more overpriced lists. It’s standard for a steakhouse, though, so if you want the trademark California cabernets, chances are, Ruth’s Chris has most, if not all, of them.

Del Frisco’s

Highest bottle price (Mouton Rothschild 1945 and Chateau Petrus 1961 magnums): $19,500

The verdict:

This list was the most impressive to our experts for its selection, but also for its price–over the top. In some cases, wines were marked up to quadruple their wholesale costs. “I appreciate the fact that they sourced wines from other places and had mature wines, such as Bordeaux and Burgundies,” says Colman, but it appeals mainly to a very affluent customer. “If you want to spend $3,000 on a bottle, step right up,” says MacLean.

Fleming’s Prime

Highest bottle price (Dom Perginon 1999): $285

The verdict:

Although this list didn’t win anyone over for a deep selection, all three experts liked its 100 wines by the glass, as well as its listing of wines from lightest to heaviest. There are also some wines that didn’t appear on every other list. They’re “not the most common items, so it’s slightly different, which is in its favor,” says Gordon.

BLT Steak

Highest bottle price (Richebourg, Domaine de la Romanee-Conti 2001): $1,495

The verdict:

While this list was among the pricier, it wasn’t the most outrageous, and it had the best range of varieties and styles, according to our experts. “The pricing is high, but it has the most interesting wines,” says Gordon, while MacLean lauded its breadth and depth. It’s not just California cabernet and Bordeaux, but solid offerings from Italy, the Pacific Northwest, Burgundy and Spain, to name a few.

Capital Grill

Highest bottle price (Roederer Cristal Rose 1996): $446

The verdict:

This restaurant provided a core list; the individual beverage managers seem to have the most freedom to add their own selections out of any of the chains. This main list also impressed our experts as one of the strongest on price and selection, despite its relatively short length. “It wasn’t as lengthy, but a pretty good mix of styles and places,” says Colman, while MacLean appreciates that “white wines get some respect here, thank you.”

Peter Luger

Highest bottle price (Lafite Rothschild 2001): $1,200

The verdict:

We slipped in this list more or less for fun, since the Brooklyn steak standard is known for its food, not its wine. All three experts thought the one-page wine list was pedestrian at best, and the pricing high, but not completely unfair. “It’s the basic stuff,” Gordon says of the list.