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Restaurant Talk: Wally's Tweaks the Recipe

What if a restaurant could access a massive wine store's warehouse—and sell bottles at nearly the same price?
Photo by: Joe Schmelzer
Wine director Matthew Turner, left, and co-owner Christan Navarro oversee a wine program of 3,000 selections at the Wally’s restaurant.

Samantha Falewée
Posted: May 19, 2017

You'd be forgiven for imagining a place with a name like "Wally's Wine & Spirits" to be a neighborhood wineshop just down the way—not a Beverly Hills beverage wonderland where customers bring six-figure shopping lists, and jet-lagged frequent-flyers sip Bordeaux and munch on Wagyu tartare at 1 a.m. But the evolution of Wally's since its 1968 opening in many ways mimics the changes in taste, tech and the law that have shaped the American wine-drinking scene over the past 50 years.

By 2013, Steve Wallace, Wally's founder, had built his once-humble shop into one of Los Angeles' biggest and most dynamic wine retailers. But his longtime partner Christian Navarro had greater ambitions still—more locations, enhanced wine experiences. So that year, Wallace sold the business to his partner and a group that included the Marciano brothers behind global fashion house Guess. The next year, the owners opened a new and unconventional wine "store" in Beverly Hills, where visitors can opt for the everyday bottle-browsing, post up at a bar with a glass and some charcuterie—or take a seat in the Wine Spectator Best of Award of Excellence–winning dining room, where chef David Féau, formerly of Grand Award winner Patina in L.A., sets the pace.

The most enticing part? The wine prices on the retail shelves are mirrored on the restaurant’s wine list, plus a $40 flat rate per bottle for sommelier service and glassware. The result is a wine program with 3,000 selections and no invisible markup. (There's also a by-the-glass list that sometimes runs to 150 options.) Féau's menu incorporates the expected high-end ingredients like caviar, truffles, sea bass and grass-fed beef, accompanied by olive oil and greens from the Marcianos' estate in Napa and more than 300 selections of cheese and charcuterie. Matthew Turner, an Alaska native who goes by "Tundra" at Wally's, opened restaurants and developed wine programs for Michael Mina, Charlie Palmer and Thomas Keller before taking up the wine director role at Navarro's restaurant.

Navarro and Turner spoke with assistant editor Samantha Falewée about the unique opportunities and challenges of the Wally's model, and what's next for the business.

Wine Spectator: Why a joint restaurant-retail store?
Christian Navarro: I’ve been in the business my whole life, and for me to go to a restaurant and see the markups was making me insane. These 300 [percent] and 400 percent markups—it didn't seem fair. So if I was going to do a restaurant one day, [I thought] I was just going to do a little bit of an extra markup to cover our Riedel glassware and pay the real sommeliers that we have. This would really give me a chance as a consumer: If I want a $300 bottle of wine, I’m really getting a $300 bottle of wine instead of a $100 bottle. All of the sudden, the world has opened up and you can start drinking better wine every day.
Matthew Turner: In my experience working with restaurants, I've always been frustrated with the fact that if people had a good experience and wanted to buy a bottle of wine to take home with them, I couldn’t sell wine to [them] when they left. [Now] I can send them home with wines.

WS: How does the restaurant pricing format influence how diners pick their wine?
CN: What this really does is urge people to drink up. We get a lot of repeat customers. Our average [bottle price] is around $150, $200. When people go out on the higher end and eat dinner somewhere else—when you look at a bottle of Romanée-Conti La Tâche, for example, for which you're going to pay $4,000 or $5,000 at Spago, who are our friends and partners—they’ll come back to Wally’s and drink it for $2,000.

WS: What are the challenges you’ve encountered?
MT: The challenge is a fun challenge, and it’s just keeping up with the list. If somebody comes in [to the store] and wants to start a cellar and buys $100,000 worth of Burgundy, all of a sudden you have a hole. But we have a great wine team that’s always sourcing wines from all over the world to bring into the store. It keeps the list active, as opposed to a stagnant museum. I have to reprint my lists every three weeks.
CN: The challenge is [that] this is a new idea, basically. Getting people to understand that you can pull a bottle off the shelf and drink it, or you can take it home. We find that 50 percent of the people are coming in buying retail and discovering the restaurant, and the other 50 percent are coming into the restaurant and discovering the retail. So there’s still the challenge of connecting those dots. If you spent time in Barcelona or Florence in these little enotecas in the neighborhoods, you would understand that. But if you haven’t done that, it’s a new idea.

WS: The whole complex is open every day from 10 a.m. to 2 a.m. What kind of clientele does that serve?
CN: Our international clientele will come in, and they're from the Far East or Europe. When you can’t sleep, you have to do something. Now you can come into Wally’s and buy some cheese, buy some Lafite at 11:30 p.m., have a glass of wine—or you can have dinner. A lot of hotels are referring business to us for those people. You never know when somebody wants to buy that special bottle of Louis XIII for $3,000. We have to be ready for that! [laughs]

WS: What’s next for Wally's?
CN: We’ve secured a location in Santa Monica. We hope to be open by either [late 2017 or early 2018]. It’ll be contemporary, warm, inviting—we try to use real elements. We’re at a point now in society where you can’t trick people anymore. You can’t have low quality ingredients in your food, you can’t have low quality wines and pass yourself off as high quality. You can expect an extremely robust inventory for Santa Monica as well.

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