What a ride it’s been, and how confusing it can be.

For years, the watchword for beverage success has been “choice.” Guests want options, experimentation, and new experiences. At first blush, the newer trend of downsizing product offerings might seem a near 180-degree turn from that school of thought, but in fact it’s not a new direction away from customer choice at all; it’s just a more efficient way of getting there.

For a growing number of hotel food and beverage managers, it’s all about providing guests a comfortable, smaller range of choices—and making sure those selections are well-thoughtout— without hitting them over the head with an overwhelming array. In this economy, it’s also about pure numbers.

LEAN AND MEAN
Keith Halfmann, corporate director of restaurants and hotel operations support for Milwaukee- based Marcus Hotels & Resorts, reports that the company has already begun rethinking the breadth of its wine and spirits offerings and will continue to do so.

“We started looking at bringing the number of wines down to between 40 and 75,” he says. “We realized that we could really do well in that range by having some recognizable wines that people want to buy and having other wines that our managers can hand-pick and have some fun with—and train the staff so that they know these wines very well.”

Halfmann says about 50 to 60 percent of each location’s wines are “recognizable,” about 30 percent are more “interesting,” and 10 percent are “hand-sell” labels.

A case in point of menu downsizing is the ChopHouse brand Marcus manages, with four locations. “The new concept will have 40 wines,” Halfmann says. “That’s a sweet spot, and it’s going to change once a quarter—not a complete change, just the ones that aren’t moving.”

Establishing that sweet spot involves not just the selection of wines but also pricing. “The days of selling the $85-plus wines have pretty much vanished. Today, they’re buying the $50 to $60 wines,” Halfmann says.

A change in thought with regard to spirits is afoot at Marcus, too.

“We’ve got a cocktail lounge at the Pfister Hotel (in Milwaukee),” Halfmann explains, “where vodka is still a core spirit, but when vodka was really hot, we had more than 30 vodkas. The consumer doesn’t necessarily want or need all of those, so we scaled it back to the 10 vodkas that we think will move really well for us.”

Even with the reduced number of selections, Marcus doesn’t have an over-arching corporate mandate for which wines and spirits to stock. Says Halfmann, “We allow our restaurants to get a feel for the local market and work with that.” Still, to some extent, given the tightened portfolio of each property, Halfmann says Marcus tries to nurture good relationships with the relatively few brands each location features.

“What we will be doing in the future is going beyond the distributor, directly to the brands, to build a relationship there,” Halfmann says. “There certainly is a buying power advantage, and in today’s economy, we need to leverage that wherever we can. Whoever is getting the business is working really hard for you, because they realize how quickly it could vanish and how important everybody’s business is right now.”

STRENGTHENING PARTNERSHIPS
Starwood Hotels & Resorts Worldwide is another group moving into a more efficient beverage strategy. In late July, Starwood rolled out a beverage program for four of its key brands—Westin, Sheraton, W, and St. Regis. Michiel Bakker, Starwood’s senior director of F&B, North America, calls it a “refresh” of previous programs at Westin and Sheraton and a new program for W and St. Regis.

For Westin and Sheraton properties, Starwood has trimmed its mandated wine, beer, and spirits offerings for multiple reasons, including, Bakker says, to strengthen partnerships with the vendors selected for the narrowed list.

Note that it’s the mandated brands being limited; the total list at each location isn’t necessarily much smaller, but there is more room within it for property managers to make their own selections. Instead of mandating 10 particular vodkas, Starwood is mandating around six and recommending that properties feature 10 total, leaving four slots open for property teams to select additional brands.

Starwood will require the corporate-mandated brands be available in all F&B departments— banquets and catering, restaurants, bars, etc. It also will provide a required beverage pricing model for its owned and managed hotels, and its franchise hotels may use the model as a reference point.

“We have found there is no need for having 25 vodkas,” Bakker says. “It doesn’t drive additional business. Our new program allows a property to service all the main call brands, offer exciting selections, and, at the same time, cut down on the overall beverage inventory.”

TIME CHANGES EVERYTHING
In July, Hyatt Hotels & Resorts, in rolling out a two-year wine program, reduced its previous total of mandated by-the-bottle wines from 27 to 24 and, more significantly, reduced its mandated by-the-glass selections from 27 to 14—the latter being a minimum, with some outlets allowed to stock additional labels of their choosing.

“It doesn’t necessarily affect the choices in the hotels, but it is definitely a reduction in the overall mandate,” says Barry Prescott, corporate director of beverage. “That means that the hotel still has the power to include what they want, but we recommend smaller [lists].”

Hyatt also instituted new spirits mandates, which went down to 75 from last year’s 106.

“We added another step, which is having two tiers,” Prescott explains. “The smaller hotels only have to carry 35 [spirits labels], and the larger hotels carry a minimum of 75. Again, we looked at the economy and our overall inventory and scaled it back, but within that, we’ve made it a little more interesting. We’ve taken off some brands that weren’t selling, and we’ve also looked at the Cognacs and bourbons and reduced the number of them where we felt we had too many.”

So is the streamlining strategy a temporary measure to survive the economic doldrums, or will the lean operating paradigm stay in place when times improve? Prescott says that right now he’d like to see it continue even in good times, but, he notes, “Time changes everything. To sit here now, I will tell you that I think smaller is better. But in two years, if things are booming again, that could change.”

For nearly a decade, Tad Wilkes, managing editor of HOTEL F&B, has written about on-premise hospitality. He is also a practicing attorney in Mississippi.