Buying Wine
Is the Second-Cheapest Wine a Rip-Off?
The oldest advice about restaurant wine lists turns out to be wrong. Researchers priced 6,335 wines and found the real markup sitting somewhere else entirely.
No, and the research says the opposite. Economists at the LSE and the University of Sussex Business School priced 6,335 wines from 249 London restaurants and found the markup on the second-cheapest bottle sits significantly below the third, fourth and fifth cheapest. The heaviest markups cluster around the middle of the list.
What the study actually found
The research worked through 470 wine menus, comparing each listed price against what the same bottle sells for at retail.
Two numbers matter. The mean markup across all those wines was more than threefold, which is roughly what the trade has always admitted. And the second-cheapest position, the one diners have been warned about for decades, was cheaper in percentage terms than the three positions immediately above it.
So the folk wisdom got the direction right and the location wrong. There is a squeeze on a restaurant list. It just isn’t where everyone was told to look.
Where the markup actually sits
| Position on the list | The old advice | What the pricing shows |
|---|---|---|
| Cheapest | Never order it | Kept keen, because the restaurant needs you to order wine at all |
| Second-cheapest | The classic trap | Marked up less than the three positions above it |
| Middle | The safe default | Where the heaviest markups cluster |
| Top | For show-offs only | Multiples shrink, because these buyers know retail prices |
Why the middle costs the most
The pattern makes sense once you look at it from behind the bar.
At the bottom of the list, a restaurant needs you to order wine at all. Price the entry bottles too aggressively and a table that was wavering orders tap water instead, and the whole sale is gone.
At the top, the customers know what things cost. Someone reaching for a serious bottle has likely seen its retail price, and a greedy multiple there reads as an insult and kills the upgrade.
The middle has neither pressure. It’s where most people land, nobody arrives with a reference price, and the wine is expensive enough to carry a fat margin without looking outrageous. That is the definition of a soft target.
What to do with a wine list instead
The mistake underneath all of this is choosing a wine by its position on a page. Position is a pricing decision, not a description of what’s in the bottle.
- Give a ceiling and a direction. “Under 60, lighter red, not too oaky” gets you a bottle chosen for fit. It also quietly signals that you’re not choosing by rank.
- Look for the less prestigious neighbours. Loire whites instead of white Burgundy, everyday Piedmont reds instead of Barolo. Same growers, same practices, less name premium priced in.
- Check the regions nobody markets to you. Portugal and Greece routinely land good bottles at prices Bordeaux stopped offering years ago.
- Ask what they’re excited about under your number. Anyone who cares about the list has an answer, and it is rarely the median bottle.
That last one works because it makes a human being, rather than a menu layout, the thing selecting your wine. We went through the wider ordering etiquette in how to order wine at a restaurant, and the same “what am I actually paying for” question applied to retail shelves in how to tell if a wine is good value.
The broader lesson is worth keeping past your next dinner. Almost every rule of thumb about wine prices is really a rule about human behaviour, and the ones that spread furthest are the ones that sound clever rather than the ones that were ever measured.
Want to know what a bottle is before you commit to it? Download AboutWine free on the App Store.
Frequently asked questions
Which wine on a restaurant list has the biggest markup?
Research from the LSE and the University of Sussex Business School, covering 6,335 wines across 249 London restaurants, found the heaviest markups cluster around the middle of the list rather than at the cheap end. The second-cheapest wine carried a markup significantly below the third, fourth and fifth cheapest.
How much do restaurants mark up wine?
The same study found a mean markup of more than three times retail price. That is an average across a whole list, so any individual bottle can sit well above or below it, and the multiple tends to shrink as the bottle price rises.
What should I order instead of scanning for the cheapest?
Give the person serving you a ceiling and a direction rather than a position on the page. Something like under 60, a lighter red, nothing heavily oaked. It gets you a bottle chosen for fit instead of one chosen to avoid embarrassment, and it takes the list's pricing psychology out of the decision entirely.
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