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Metro Detroit

March 19, 2014

Restaurants, diners weigh pros and cons of new BYOW law

By Tiffany Esshaki
C & G Staff Writer

METRO DETROIT — As of last Friday, Michigan has become one of several states across the country to allow diners to bring their own bottle of wine to restaurants.

But as many wine lovers are quickly learning, there’s reason to hold off on the celebration. The “bring your own wine” law comes with several stipulations that will keep sippers and pourers alike on their toes.

House Bill 5046 was signed by Gov. Rick Snyder in late 2013 and took effect March 14, 2014. It provides restaurant customers the opportunity to bring their own bottle of wine to participating establishments that have a liquor license. That means that if your favorite eatery doesn’t have a wine selection to fit your taste, and they give you the OK, you can bring along a bottle of something you’d like to enjoy with your meal.

“Agriculture, and specifically the wine industry, is an important part of the Michigan economy and one the state is proud of. With broad support from relevant associations, we believe this law (is) clearly in the best interest of Michigan’s growers, restaurants and citizens,” Dave Murray, deputy press secretary for Snyder, said in an email.

The new law is a big win for wine aficionados, and even more so for fans of local wine, such as Cortney Casey. She and her husband, Shannon Casey, are the owners of the Michigan by the Bottle Tasting Room in Shelby Township. The pair is getting ready to open up a new tasting room on Woodward Avenue in Royal Oak, and the BYOW law should help to promote the impressive but not-well-known winery scene in the Great Lakes state.

“I definitely think it’s a step in the right direction,” said Casey. “A lot of Michigan wine lovers and wine lovers in general seem to share the sentiment that this is a long time coming. It’s wonderful that customers who are committed to drinking local, and who are fans of smaller wineries that have little or no distribution — and therefore don’t end up on restaurant wine lists — will be able to enjoy their favorite beverages along with their meals.”

It’s no secret that over the last few years metro Detroit, like much of the country, has seen a surge of interest in buying locally sourced and made products, particularly food and drink. Casey’s hope is that restaurants will take notice of customers bringing Michigan wines with them to enjoy, and then perhaps they’ll add local selections to their in-house wine lists.

But, of course, diners will have to make sure they’re only bringing bottles to restaurants with liquor licenses that have chosen to participate — no establishment is forced to allow customers to skip the wine list in favor of their own sips. In fact, Casey said, many restaurants may choose not to offer the option for fear of losing sales of their own wine inventory.

Those who do participate, however, probably won’t do so for free. The trade-off, Casey explains, is the ability for restaurants to set their own corkage fees to open and serve the bottle to customers. That’s generally how restaurants make money from BYOW laws in other states.

“It’ll be a little bit interesting to see how it plays out and see where the corkage fees fall. If the fee is more than you spent on the bottle, it’s really up to you to decide if you want to bring that wine with you or you’d rather enjoy it at home,” she said.

According to Dan Filipek, beverage director for the restaurant Aquavit in New York City, corkage fees in that BYOW state average around $35 per bottle and go up for higher-end restaurants. The system, he said, has its pros and cons, but in general, it’s been a success for the city.

“I think lenient corkage policies definitely bring in people. Some restaurants in Chinatown are known for having free corkage, and a lot of people go just for that. Other places have free corkage day or hours, which also bring people in,” he said, explaining that discounted corkage fees can be used as a promotional tool. “I think less and less people are willing to pay for high-end wine in a restaurant, so you see less high-end wine being sold from the list and more via corkage.”

It makes sense if you think about it, Casey said, and consider the markup on wines at restaurants. From what she’s heard from several sommeliers in the restaurant industry, most places tend to set the price of a glass of wine at what the bottle costs — that means that when you buy a glass of red or white, you’re really paying for the whole bottle, just in case the rest of that bottle isn’t sold to other customers before it goes bad and needs to be thrown out. That makes it more economical to buy the whole bottle at a restaurant, but there’s a markup on that purchase, too.

“If people are bringing in wine and not buying it from them, then restaurants are going to set corkage fees that make sense for them in terms of profitability,” said Casey, who added that she heard of restaurants in other metropolitan areas setting corkage fees as high as $85.

Each restaurant in metro Detroit will tailor the new law to fit its business model. For instance, Townhouse Bistro in downtown Birmingham will allow diners to bring their own bottle of wine for a $40 corkage fee, while The Hill Seafood and Chop House in Grosse Pointe Farms will not offer the choice to customers. 

But none of those options are available to Isaiah Sonjeow, co-owner of Khom Fai: Thai Dining Experience in Shelby Township. Since his restaurant doesn’t have an existing liquor license, his customers won’t be able to bring their own bottles to dinner. That’s one of the major differences between Michigan’s new BYOW law and similar policies in other states.

Casey said that, in some places, a major selling point of the BYOW law is that it allows smaller businesses that can’t afford pricey liquor licenses the chance to compete with larger restaurants that can. Sonjeow said his Thai restaurant, tucked into Shelby Township amidst throngs of chain restaurants, is now at an even greater disadvantage.

“I don’t mind that people can bring (wine) into an already licensed establishment. There are rules in place to make sure people are being reasonable and safe. But I think it’s time to look at how we acquire those liquor licenses,” said Sonjeow. “It’s hard for someone like us to keep up with corporate conglomerate places when there’s a small amount of liquor licenses and they’re in high demand. Small-business owners, like us, bring a bit of culture to the city; we have a presence in the community.”

In the weeks to come, metro Detroiters will likely get a better feel for the parameters of the new law, and restaurants will be able to gauge whether the policy is good for business or just a nuisance. Perhaps the law will need to be revisited.

But it’s not worth discarding altogether, Filipek said. BYOW is a shift in hospitality as we know it, rather than a mere trend.

“I think it’s inevitable. Baby boomers are retiring right now, and a lot of them are collectors with wine of their own and they’re not going to spend three times what they paid for it in a restaurant (off the wine list) but they will pay $50 (corkage) to bring in their own,” he said.

You can reach C & G Staff Writer Tiffany Esshaki at tesshaki@candgnews.com or at (586)498-1095.