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https://medium.com/@joelleparenteau/why-are-restaurants-so-fucked-ca07c4624745 https://medium.com/@joelleparenteau/why-are-restaurants-so-f... > it wasn’t alwa

https://medium.com/@joelleparenteau/why-are-restaurants-so-fucked-ca07c4624745 https://medium.com/@joelleparenteau/why-are-restaurants-so-f... > it wasn’t always this way — margins used to be double, if not triple, what they are now. But for the past couple decades, while menu prices should have been rising to keep up with things like inflation and rapidly increasing rent, price wars instead drove them down ($1 value meal anyone?). All this eroded margins til restaurants were left with nothing but bread crumbs. This failure to manage expectations has simultaneously obliterated margins, all the while skewing and reinforcing our perception of what food should cost.

deleted 6y ago
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chongli 6y ago
reinforcing our perception of what food should cost It's supply and demand. Our perception of what food should cost has nothing to do with it (and this argument is an unhelpful culture war framing). Food is in extremely abundant supply. Same goes for cheap restaurant labour (which is often dodging labour laws). What is scarce in this equation is real estate in high traffic locations. That is why rent goes up and margins go down. During the virus lockdown, restaurants are trying to operate a low margin business (food service) while paying high rents for valuable real estate they aren't benefitting from, at all. You don't need a fancy restaurant in a high-traffic urban location to prepare orders for delivery. You'd do just as well with a commissary kitchen in a warehouse somewhere.
JAlexoid 6y ago
Honestly? Common food has become so good that only a few restaurants can produce food and provide experience to justify paying what they ask for it. I can only count one restaurant that surprised me with quality, while a few Michelin star places disappointed here in NYC. But that's a result of food production becoming better and more efficient, while mid-range and high-end restaurants are standing mostly still. I still get the same service and same quality of food from Milos today as I got 20 years ago... and prices only went up. Meanwhile Popeyes and McDonalds have improved dramatically in the last 4 years alone! Unfortunately it took this pandemic for restaurants to start feeling the burn from their conservativism.

deleted 6y ago

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chongli 6y ago

reinforcing our perception of what food should cost It's supply and demand. Our perception of what food should cost has nothing to do with it (and this argument is an unhelpful culture war framing). Food is in extremely abundant supply. Same goes for cheap restaurant labour (which is often dodging labour laws). What is scarce in this equation is real estate in high traffic locations. That is why rent goes up and margins go down. During the virus lockdown, restaurants are trying to operate a low margin business (food service) while paying high rents for valuable real estate they aren't benefitting from, at all. You don't need a fancy restaurant in a high-traffic urban location to prepare orders for delivery. You'd do just as well with a commissary kitchen in a warehouse somewhere.

JAlexoid 6y ago

Honestly? Common food has become so good that only a few restaurants can produce food and provide experience to justify paying what they ask for it. I can only count one restaurant that surprised me with quality, while a few Michelin star places disappointed here in NYC. But that's a result of food production becoming better and more efficient, while mid-range and high-end restaurants are standing mostly still. I still get the same service and same quality of food from Milos today as I got 20 years ago... and prices only went up. Meanwhile Popeyes and McDonalds have improved dramatically in the last 4 years alone! Unfortunately it took this pandemic for restaurants to start feeling the burn from their conservativism.