Comment

Restaurants have notoriously thin margins. I’m not defending this bill, and there are definitely awful practices out there, but it ain’t easy. Even a $34 dollar steak only kind of covers all the ancillary costs that make it happen.

The biggest issue with the crunch we have going on is that food (prepared or otherwise) should be way more expensive, and that shouldn’t be an issue because most people should be making way more money. All of those should/shouldn’ts got way out of whack over the course of decades, and the circus only continued because people found crappy ways to keep it going.

It’s a lot of industries. Construction is a great example. The developers make money. The material vendors make money. The builders make money. The sub contractors who actually put the parts together get haggled on invoices and take the lower amount because they have payroll to make and equipment loans to pay. Loans that are happily given out because the equipment can be easily repossessed.

It’s a very good thing everything is correcting, but it’s going to be an ugly process as workers get their due and pass the burden on to the small business owners.

source

Sort:hotnew top

snooggums@kbin.social ⁨11⁩ ⁨months⁩ ago
Sounds like sit down restaurant menus should reflect the actual costs including waitstaff then like any fast food place is able to do.

source
- DAMunzy@lemmy.dbzer0.com ⁨11⁩ ⁨months⁩ ago
  Wait staff with tips get more than fast food restaurant employees though
  
  source
  - HeyThisIsntTheYMCA@lemmy.world ⁨11⁩ ⁨months⁩ ago
    That’s a great argument for the manager/owner to do a shit job
    
    source
Showroom7561@lemmy.ca ⁨11⁩ ⁨months⁩ ago

Restaurants have notoriously thin margins.

Help me understand.

Assuming restaurants have the same overhead as any other business: rent, staff, insurance, maybe equipment (manufacturing, etc.), what else?

They don’t have expenses like vehicles, tariffs on imported goods, the cost to fly staff out for conferences, tech costs, and so on.

The only difference is the product they bring in, and the product they put out.

As a consumer, who doesn’t get the benefit of industry discounts or high-volume prices, making food is really inexpensive.

When I see a restaurant, for example, selling pasta with marinara sauce for $15-20 a plate, I’m curious to know why they have to beg to cover costs. You can make the same dish for a family of four for under $3, and save $100 you’d spend getting the same dish at a restaurant.

So, again, if the cost of ingredients allows for such a significant markup, well beyond what most other businesses are able to get away with, why are restaurants having to charge “service fees” on top of tips?

source
- ShaggySnacks@lemmy.myserv.one ⁨11⁩ ⁨months⁩ ago
  It’s the behind the scenes that cause a lot of the markup. There might be only two or three food service providers in your area. Food Service Company A has the same prices as Food Service Company B and C. There is no real competition to force prices down for restaurants.
  
  If you are a franchise restaurant, you have to pay franchise fees, buy your all products from the franchise, work within the certain parameters, etc. There is no real way to find ways to drive down prices since your prices are set by the franchise through the prices of the product, corporate oversight, etc.
  
  source
  - Showroom7561@lemmy.ca ⁨11⁩ ⁨months⁩ ago
    Great points!
    
    source
- batmaniam@lemmy.world ⁨11⁩ ⁨months⁩ ago
  So I’m stretching it a bit because at the end of the day this really does apply to more than restaurants, but the other commenter had it right.
  
  Things like rent, insurance, etc go into the cost for well above the plate. So the ingredients are one thing, but you have to make up the cost of rent, paying the staff when there’s low customer volume, all the insane amount of costs that go into running a business. That server has to make up for the cost of printing menus and delivering them by mail.
  
  None of this is the servers fault, who should get a fair wage, but it all adds up in a way that makes it hard for the owner. In fact, the person who sold them the grills, refrigerators, and all the other equipment, knows exactly and empirically how hard it is and sets their prices accordingly.
  
  And it’s not like that company’s delivery drivers, techs, and fabrication workers also don’t deserve a wage. Or the Tyson folks that are plucking the chicken delivered.
  
  The issue is, at the end of the day, those companies probably should be less profitable. But instead of accepting that, we put all of the companies that make all the stuff that run that restaurant into bigger companies that are now part of mutual funds, and they sell it out knowing they can grab it back if it goes under.
  
  So you might be able to get away with making a few plates and some money, but trying turning it into something that will let you pay your rent and put your kids into a school. “Bob’s Burgers” is pretty true to life.
  
  source
Frostbeard@lemmy.world ⁨11⁩ ⁨months⁩ ago
Cheap sub contractors need so much constant control to make sure things are delivered on spec that it is almost like it costs more than to hire the more expensive company with a reputation for solid work

source
- RubberElectrons@lemmy.world ⁨11⁩ ⁨months⁩ ago
  Saw exactly this when I was doing commissioning for a large municipality. No matter how tight the specs were, some of these knuckleheads would do it their own way and get mad when we forced then to do it right.
  
  Some of them would just claim bankruptcy if the mistake was big enough.
  
  Pro-tip, friends: don’t pick the lowest cost of construction bids, I guaran-fucking-tee it’ll cost you more than you saved.
  
  source
Kage520@lemmy.world ⁨11⁩ ⁨months⁩ ago
I worked at a pizza shop way back ages ago (early 2000’s), but I think the formula is generally the same. Food costs they would shoot for 33%, labor ended up being around 33%, the rest was overhead for the facility (rent, AC, etc) and profit.

I think that’s actually a pretty fair amount of profit in that. But that was almost 20 years ago. I feel like the formula is likely similar though.

source