I live in Northbridge. For those who know Perth, that says something already. It is not the most polished neighbourhood in the city, but it has energy. Bars, restaurants, people out in the evening. For a Frenchman, that matters. Going out is not just about eating and drinking. It is about being in a room with people you want to see, sharing something, talking properly.
Over the past several months I have noticed a shift. Friends declining invitations. Not because they are busy. Because, as more than one of them has put it, the prices have become crazy relative to what you actually get. No table service. Tables not wiped down. A wine list presented as a QR code on a sticky phone screen, by someone who cannot tell you which end of the Margaret River valley the wine comes from, what year is a good vintage, or simply what the wine tastes like.
Last week, an Australian friend, and I say Australian because this is not the complaint of a difficult Frenchman dragging his country behind him as a standard, suggested we skip the bars of Northbridge entirely and open a bottle of Cabernet Sauvignon at his place. His description of the local bar scene: thieves. That word has weight. When someone who grew up here, who has no particular European standard to measure against, reaches that conclusion, something has gone wrong.
In October 2024, I wrote about the gap I observed returning from France: the distance between what hospitality means in a French city and what it too often means in Perth. Two years on from my first article on this subject, that gap has not closed. The wine question sits at its centre.
What the figures say, and why they should concern the whole industry
I recently had the opportunity to exchange with representatives of WA wine associations, including the Margaret River Wine Association. What they described about the on-premise market, meaning bars and restaurants, confirmed what my social life in Northbridge had been telling me in a less formal register.
The numbers are not encouraging. According to Australian Grape and Wine, domestic consumption of Australian wine has declined by seven per cent over the last five years, at a faster rate than any other alcoholic beverage. More precisely, the number of wine drinkers in Australia fell by 1.6 million people between 2021 and 2024. Wine Australia has commissioned dedicated research into what is happening specifically in restaurants and bars and found that wine consumption is declining significantly in that channel. That is not a background trend. It describes a structural contraction in the environment where wine is supposed to be discovered, recommended, shared, and remembered.
Globally, the picture is equally sobering. The International Organisation of Vine and Wine confirmed that world wine consumption in 2024 reached its lowest volume since 1961. At the same time, Australia is sitting on a stockpile of around 262 million litres of wine in excess of what the market can absorb, according to Wine Australia's most recent report. More wine than the country can sell, and the response in too many Perth bars is to charge $28 a glass for a mid-range local red.
The pressure valve and its limits
To understand why prices have gone where they have, you need to understand the economics of the industry, which are genuinely difficult. In a well-documented exchange of reader letters responding to wine critic Huon Hooke's column in The Real Review, several industry veterans with decades of experience described the underlying cost structure plainly. Food cost needs to be kept to 25 to 30 per cent of revenue, labour to around 30 per cent, premises and licences to another 30. That leaves, in theory, a 10 per cent margin. In practice that margin is frequently eroded further.
Alcohol, and wine specifically, is where restaurants have historically recovered those losses. A bottle retailing for $30 at a bottle shop wholesales to a bar or restaurant at roughly $20. The industry standard places that same bottle on a wine list at between $60 and $80, which is three to four times the wholesale price. By the glass, the standard industry formula for entry-level to mid-range wines prices a single pour at 85 to 100 per cent of the wholesale cost of the full bottle, already generating a profit margin of around 400 per cent on each glass sold. For more expensive wines the formula adjusts, with operators typically reducing their percentage margin to keep the glass price within reach, though the absolute profit per pour remains significant. For a mid-range bottle that cost $20 wholesale, the formula puts the glass price at $17 to $20, and four pours return the full wholesale cost with profit built in. In Northbridge bars today, that same glass is routinely priced at $22 to $28, well above what the formula would suggest. Four pours at $25 generate $100 from a $20 investment.
The margin is real. What is absent, in most cases, is any service, knowledge, or experience that would begin to justify it. And the customer has noticed. What I observe around me now, consistently, is people stopping at one glass. Not ordering a second round, neither a third. The social rhythm of an evening out, a second glass with a friend, a bottle shared across a table, is quietly disappearing. This is not an impression. Tyro's 2025 Eat Pay Love report, which surveyed more than 1,000 Australian consumers, found that 35 per cent of Australians are now less likely to buy a round than they were a year ago. The pricing strategy designed to extract more revenue per glass is producing fewer glasses sold. The loop is self-defeating, and the operators running it appear not to have noticed yet.
There is a further problem I have observed recently, and that the industry is not discussing openly enough. Faced with these pressures, a growing number of venues are solving their margin problem not by improving the offer but by quietly downgrading the wine. A cheaper entry-level bottle, bought at $10 wholesale instead of $20, sold at the same $22 to $25 per glass, delivers a significantly better return with no change visible on the price tag. The customer pays the same and receives less. The wine list shortens, regional producers disappear, Margaret River labels give way to bulk alternatives. The price holds. The quality drops. And the producer who spent decades building a reputation ends up priced off the very lists that should be showcasing them.
Investors at the table, hosts absent
I have had a number of conversations recently with entrepreneurs who have opened or are opening hospitality venues in Perth. A pattern emerges. These are people who think in terms of return on investment at twelve to eighteen months. The business model starts from the income side: how do we price wine to extract margin quickly? The question of what experience justifies that price comes later, if it comes at all.
This orientation is fundamentally different from the one that built the venues people are actually loyal to. The bars and restaurants anywhere in the world that earn lasting custom were not built as investment vehicles. They were built by people obsessed with a specific thing: a wine region, a cuisine, a way of receiving people, a room that felt like somewhere. The financial return was the consequence of getting that thing right over time, not the premise.
Hospitality takes time to work. A customer does not become loyal after one excellent evening. They become loyal after a pattern of reliable, consistent experience: the same standard of wine, the same quality of welcome, a menu that changes with the season and reflects someone's actual thinking. That accumulation takes years. Raising the price of a glass of Chardonnay does not speed it up. It tends to end it.
A 2025 study by the Food Service Association Australia found that 63 per cent of Australian diners prioritise direct price value over loyalty schemes. Consumer loyalty in Australian hospitality is now conditional on value and necessity, not on habit or social tradition. The operators pricing wine at $28 a glass are not just losing a sale that evening. They are dismantling the culture that would sustain their business across years.
Is this only Perth? What Melbourne and Adelaide suggest
It would be unfair, and inaccurate, to present this as a purely local crisis. Fine dining bookings have fallen roughly 20 per cent across Australia since January 2022. Hospitality closures nationally reached 9.3 per cent in the year to early 2025, one in eleven businesses. Perth, cushioned by the mining economy, sits at 5.2 per cent, one of the lowest rates in the country. The financial pressure is real everywhere. But the way different cities respond to that pressure is not identical, and the differences are instructive.
Victoria placed 20 restaurants in Australia's OpenTable Top 50 for 2025, based on more than 195,000 verified diner reviews. Western Australia placed one. That gap is not explained by population alone. In Melbourne, coverage of the best new venues consistently uses phrases like knowledgeable service and considered wine list as baseline expectations, not distinguishing features. The Good Food Guide 2025 awarded a Sommelier of the Year at Chauncy, a venue that is not a fine dining institution. Recognition at that level shapes what operators invest in. A floor manager in Melbourne who cannot discuss the wine list is a problem the owner identifies and addresses. In too many Perth venues, it does not appear to register as a problem at all.
Adelaide presents a different model, and in some ways a more useful one for Perth to consider. The city has developed a closer working relationship between its restaurant culture and its wine regions, the Barossa, McLaren Vale, the Adelaide Hills, in the way Perth could have with Margaret River. What is emerging in Adelaide in 2025 is notable. A sommelier-run wine bar in the West End, Canopy Bar, deliberately offers wines usually restricted to fine dining in a casual setting, at by-the-glass prices designed for accessibility rather than extraction. Another new opening offers BYO without a corkage fee. These are choices that signal a philosophy: they prioritise building a relationship with the customer over capturing margin in a single transaction.
Perth does have genuine exceptions worth acknowledging. On a single stretch of William Street in Northbridge, three venues demonstrate what is possible. Vincent Wine, modelled on the neighbourhood wine bars of Paris, offers a rotating by-the-glass selection written on the wall tiles daily, with staff who can walk you through the difference between a Mosel Riesling and a Sicilian white without condescension. Wines of While operates with a list of more than 600 references, refreshed almost daily by the glass, anchored in a genuine philosophy about how wine should be produced and presented. Margot's, which opened in 2024, has assembled a curated WA and European wine list alongside a considered martini programme, with free tastings run every Friday afternoon from the deli space. These venues understand that the wine offer is the experience, not an afterthought designed to fund the food. They are, however, exceptions. The dominant pattern across most of Perth's bars and restaurants is the one my friends are reacting against.
What should change
There are concrete things operators can do, and it is worth naming them rather than ending on a lament.
Pricing wine at a point that reflects the actual experience being offered is the obvious place to start, and the most resisted. A $28 glass is defensible in a room where someone knowledgeable chose the wine, can describe it, serves it in the right glass at the right temperature, and can tell you something about the producer. It is not defensible from a QR code in a room with dirty tables. The price and the experience need to correspond.
Investment in wine knowledge at the floor level is the next step, and it does not require expensive sommeliers. It requires staff who know the wines on the by-the-glass list well enough to describe each in a sentence. Margaret River is 270 kilometres from Perth. Its Cabernet Sauvignon is recognised internationally. MRWA and Wines of Western Australia run educational programmes for exactly this purpose. There is no excuse for a Northbridge venue to be unable to say something meaningful about what it pours.
The wine list itself needs to be treated as a living document. A selection that does not change is a statement of indifference. The by-the-glass rotation should move regularly. Producers should be named. Vintages should be visible. This costs nothing except attention. And it would go some way toward reversing the quiet downgrading of wine that is currently damaging not just the customer experience but the local producers who depend on the on-premise channel to build their reputation.
The more structural change is taking a longer view of what a customer is worth. A diner who returns forty times over three years because they trust the place generates more revenue, at lower cost, than one who overpays once and tells three friends to avoid it. The operators who will still be in business in five years are, most likely, the ones who understood that from the beginning and built accordingly.
Western Australia produces some of the finest wine in the country. Cabernet Sauvignon from Margaret River that holds its own against Bordeaux. Chardonnay that has won international trophies. That wine deserves to be served by someone who can do something with it beyond applying a markup and handing it over. The gap between what Margaret River puts in the bottle and what too many Perth venues do with it once it arrives is exactly the gap my friends are reacting to. They are not wrong. The price is not the problem. The absence of anything to justify it is.