Why is my tofu $17?
Let's talk about money. Over at the New York Times and other food blogs people have been talking about charges at restaurants for things like bread and butter, ice, water, breathing etc. I've been wanting to talk about pricing for a while, and this gives me a chance. Some folks are offended by these extra charges, others feel that they're fair, and back and forth, and so on.
Pay $1 extra for bread? The
debate rages on.
But the bigger question is, why does your food cost money at all? Let me tell you a simple fact: when you order the tofu at Dirt Candy you are not getting $17 worth of tofu. And I don't arrive at that price based on the labor costs involved in making that dish, either. The actual food cost for that dish is somewhere around $2, and I would imagine that unless you're eating caviar or a piece of Kobe beef, most food you eat at most restaurants is going to cost $2 - $6 per dish. I could actually give the food away for free at Dirt Candy based on what it costs me. And don't believe the hype when someone starts talking about raising prices because they're serving you better quality food. In most cases we're talking about food prices going up by a dollar or two.
So why $17 for the tofu? Or $16 for the risotto? How do I get to these prices? Do they come to me in a dream? No, I do what every restaurant does, I figure out what I need to make each night in order to stay open, then I estimate how many customers I can serve per night, and then I do simple division and spread it across the dishes. Because when you buy a dish at Dirt Candy you're not paying for the food, you're renting a table, the same way you rent your apartment, just for a shorter period of time and you're not allowed to walk around in your underwear. You're paying for my employment taxes, my utility bills, part of my rent, part of my construction costs, part of my insurance costs. That toilet paper in the bathroom? Something like .25% of your bottle of wine paid for that.
How to make toilet paper.
First we start with an expensive wine...
To bring it full circle, what about the extra charges people are debating for things like water, ice and bread and butter? Well, to be honest I don't care about paying for these things in a restaurant as long as I know beforehand. But at Dirt Candy (and most other restaurants), you're already paying for your water, ice and bread and butter. These costs are spread across the menu. You pay for the grits and you're also paying for your bread. It isn't free, I just hide its cost in the price of other items on the menu and don't tell you about it, just like every other restaurant. So if I suddenly started charging for bread (which I'm not, but for example) that would mean one of two things: either my margins are shrinking and I need to make more money (due to rising food costs, a jump in my rent, higher oil bills) or I'm serving less customers and I need to make more money per table. It has nothing to do with suddenly increasing the quality of the food I'm serving because food isn't that expensive, relatively speaking. Even if my bread cost three times what I currently pay for it, I still wouldn't need to charge you for it. Look at Momofuku Ssam Bar. Their ice, they say, costs them $1 per cube because it's magic ice, but they still don't need to charge extra for it. Why? Because the cost is built into the price of your drink. In effect, they're already charging you for their magic ice, but they're not itemizing it that way on your bill.
Magic ice delivery vehicle, also made
of magic ice.
So feel free to call my food expensive. Of course it's expensive - I have a restaurant in Manhattan and rent is expensive here and that's a lot of what you're paying for - my rent, the rent on my sous chef, Jesus's, apartment (do you want Jesus to live in a box?) and you're paying for my daytime prep chef's rent. But overpriced is another story - of course $17 isn't a fair price to pay for a dish made mostly of tofu. But it is a fair price to pay for a dish made mostly of tofu in a restaurant in Manhattan. You're not paying for the food when you eat here, you're paying for the restaurant, of which food accounts for about a third of the costs. The only way to make things less expensive would not be to change the ingredients, but to move to another city.
Forgot to mention: you are also
paying for my robot maid.
And that's Restaurant Economics 101.