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Restaurants and hotels are charging customers around four times the purchase price for wine and champagne
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by infomatique | June 21, 2008 at 03:40 pm
1010 views | 25 Recommendations | 8 comments
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Before we adopted the Euro as our currency people in Ireland were not so aware that prices in Ireland were much higher than in the rest of Europe. As soon as we joined we began to notice but then we began to notice that the difference began to increase rather than reduce and now things have just about reached breaking point. This may also partly explain the vote against the Lisbon treaty.
For example it was announced that the new iPhone would not cost more than $199 anywhere (actually they said almost anywhere) but the price here is equivalent to $460.
The value of Sterling reduced greatly relative to the Euro and yet the British supermarket chains who operate here did not adjust their prices downwards even though they source in the UK. All sort of excuses are offered: the cost of doing business in the Republic is much higher than elswhere (they never mention that corporation tax is only 12.5%); Ireland is an island so the cost of transporting goods from abroad must be recovered (so why does this not apply to Northern Ireland); the best excuse is used by Easons when they claim that they buy Sterling six months in advance when it was high relative to the Euro, how do they always manage to be so unlucky?
Another thing that I have noticed is that if a restaurant here in Dublin begins losing customers they respond by increasing their prices thus punishing their loyal customers.
Restaurants charging 300% mark-ups on wine
22 June 2008 By Susan Mitchell
'); //--> Restaurants and hotels are charging customers around four times the purchase price for wine and champagne.
An investigation by The Sunday Business Post also revealed huge price variations between the prices charged by restaurants for the same bottles. In one case, a bottle of champagne was being sold for more €300 more than the supplier was charging.
The figures were calculated without including the substantial trade discounts that can be negotiated with suppliers.
A bottle of Pinot Grigio Sacchetto costs €29 at Balzac on Dublin’s Dawson Street. Cassidys, a supplier, charges €6.60 a bottle – a mark-up of about 340 per cent. The executive chef at Balzac said the wine menu was under review.
Ashford Castle charges €500 for a bottle of vintage champagne that is available from a Dublin restaurant for less than half that price. One supplier sells it for €65 and it has a retail price of approximately €245. The sommelier at Ashford Castle said the champagne was bought through London at €200 a bottle, and the mark-up was lower than was typically charged.
The president of the Restaurants Association of Ireland, Gina Murphy, said restaurants were not trying to rip people off, and huge cost variables could explain the mark-ups and substantial price variations.
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infomatique
Dublin, Ireland
Most RecentMost Recommended Comments (8)
at 15:47 on June 21st, 2008
infomatique, I like this story. It's good stuff.
The difference in the price of items is really shocking. I can understand that Ireland is an island so things have to be shipped further in order to reach there, but you're right - why doesn't that apply to Northern Ireland?
at 15:55 on June 21st, 2008
I should mention that I save a lot of money by importing all electronic and photographic equipment from abroad. Originally I imported from the UK but when we joined the EU I soon discovered that I could get better prices in Germany. For example I saved almost Euro 1300 by buying my Canon 1Ds Mk III in Germany rather than locally here in Dublin (the price included courier delivery and Irish VAT). I purchase my books, CDs and DVDs from Amazon in the USA and Canada and I also import DVDs from Australia
at 16:08 on June 21st, 2008
I have uploaded a photograph of Hugos Restaurant which is operated by Gina Murphy who is mentioned in the main story. Hugos is a bit on the expensive side but the quality of the food and service is superior to the majority of Dublin restaurants. All their wines are also available by the glass which is fairly unusual here in Dublin.
at 17:10 on June 21st, 2008
infomatique, I like this story. It's good stuff. 300%!!! That's way too much!
at 18:58 on June 21st, 2008
I liked the story, and commend you on the bravery to say something. Here in the USA with oil being such a big deal and beauacratic pockets not getting the usual billions of dollars because our people are so poor, they have increased prices too, causing people to be more poor, unable to travel, no healthcare and no means to really make a living.I live in Los angeles, sometimes hotels charge more to some people, based on appearance, sometimes they charge more on different days, for no reason. I hear soon airplanes wont be able to afford to fly and the price of tickets have gone way up so the average american can not afford to leave. Most americans do not even have a passport, nor have they been outside the US. Its crazy how our government keeps the sick and poor, sick tired oppressed and poor. No wonder why the rest of the world hates americans, there are two kinds of americans here, us and them... I think the them part is the part they care about.
at 20:56 on June 21st, 2008
infomatique, I like this story. It's good stuff. Though it is not fair, restaurants have high overhead, combined with crushing taxes and seasonal tourism which restaurants rely on to get them through the lean times. Can you blame them, it is done everywhere in the world.
A bottle of $40.00 40 ounce bottle of Rye at $4.00 a one ounce shot gets the restaurant $120.00 profit in which to pay for staff, rent and utilities. In Vangroovy Canada wine by the glass routinely goes for about $7.00 to $8.00 dollars a 6 ounce glass for a $9.00 to $12.00 bottle. Pretty good coin.
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nbaxter01at 02:10 on June 22nd, 2008
Does this person not understand that it is wage related, We dont see him complaining that the republic of ireland has the highest minimun wage in Europe which was €8 over a year ago, in UK today it is £5.50 or €6.85. Also every establishment marks up the price of alcohol. The average price for a shot of whiskey in a pub here is probably £3 while the pubs are buying the 1.5 litre bottles from the suppliers for around £10.
the reason why things are cheaper in america and other countries is all down to wages and lower VAT on items under a certain value
at 05:06 on June 22nd, 2008
Ireland (ROI) has the second highest minimum wage in the EU, after Luxembourg.
I did not mention the minimum wage because it is balanced by other aspects of the economy such as much lower corporation tax and a very stable and predictable business environment resulting from "Social Partnership". Small companies in the UK pay 21% on profits while companies in Ireland pay 12.5%. There are exceptions to the minimum wage which are listed here and one in particular stands out: "It may further be reduced by up to €7.73 a day if lodgings and/or food are provided as part of a job" this has been used in the past to underpay foreign workers.
Worst case higher VAT (21% against 17.5% in the UK) only accounts for a 3.5% difference in prices. When people mention high VAT they forget to mention that 21% is the high rate here in Ireland. Restaurants and the service industry in general only pays 13.5% which is lower than what applies in the UK (there is a 5% rate in the UK which applies to a small number of items such as children's car seats). It should also be noted that the service charge added by many restaurants does not attract VAT as it was assumed that this money was distributed to the staff ... this is likely to change as it was used as a way of avoiding VAT.
Ireland's minimum wage was introduced in 2000, and is currently €8.65 an hour. This is subject to reduction as follows:
30% reduction for all employees under 18.
20% reduction for employees over 18 in their first year of employment in any job since they turned 18.
10% reduction for employees over 18 in their second year of employment in any job since they turned 18.
It may further be reduced by up to €7.73 a day if lodgings and/or food are provided as part of a job.
Trainees (including those over 18) are also entitled to different minimum wages, reduced as follows:
25% reduction for the time during the first one-third of the course.
20% reduction for the time during the second one-third of the course.
10% reduction for the time during the final one-third of the course.