I can say with absolute certainty that the recession has hit the restaurant business - or at least the one restaurant with which I am involved.
We are still selling wine, but our bottle sales was down in March by nearly 25% as compared with 2008. Additionally, the average price per bottle sold has decreased from $38 to $30.
I spoke with one of our wine reps on Friday and he said that he is seeing a lot of "trading down". That is where people who continue to buy, are buying lower priced or differently marketed products. He said that he'd noted that the premium French wines had taken a huge hit while the lower priced wine was doing a better job of holding its market share.
One trend that I have noticed is that unpretentious wines are doing better in the down market. One of our wines is "Boots" by Trevor Jones: an light Australian white. The label features a pair of rubber boots that you might expect laborers to wear in the vineyard. We are selling out of this stuff. I suspect that the combination of its low price and common feel make it a winner in this economy. I don't pretend to understand the psychology of wine drinkers, but this much I see first hand:
1. Expensive French wines are gathering dust.
2. Inexpensive wines with unpretentious labels are doing very well