Quality meat? Quality cooking? Staff and other overhead costs? Etc.
In: Economics
In the past, we did a few ‘fancy’ steakhouses. What it seemed we paid for was service. We took the in-laws out to dinner once at one so there was 9 or 10 of us total. When the food came out it was brought by 5 servers and placed down all at the same time.
Attention to water glasses and dropped napkins were all addressed right away.
The food was mediocre at best, but it wasn’t a terrible experience.
It will be a nicely marbled cut of beef so that already is going to be more expensive than most grocery store cuts, then you have to pay a chef that has enough experience to cook that exactly to your order, over and over again, then you have to pay for the host’s wage that greeted and seated you, and the server that took your order and brought your food, and the busser that cleaned your table when you left, and the dishwasher that cleaned your dishes, and the utility and rent bills, and the restaurant owners probably want a little bit of money too…
Count the people that it takes to put that steak on your table. Eight to ten, maybe more.
All those people get paid. Building has bills/rent/mortgage. Owner has to make a profit. Food cost, etc.
I’m surprised the restaurant makes any money at all.
A high end steak actually has pretty low margin as far as food ingredient costs vs. customer price is concerned. Typically for restaurants is that a meal costs about 3x the ingredient cost, but a top steak might be only 2x or even less.
The meat you get at a top steakhouse is prime beef, which is well marbled and only the top 1% of all beef. The meat is then aged, either dry or wet, for 30 days or more. Dry aging means the meat loses water weight as it dries out, and either case the outer layers that decompose need to be trimmed off a steak so the actual usable meat relative to the initial cost for the primal cut is only a portion (eg a 30 lb. cut of beef might only become 20 1-lb. steaks). So that steak itself might cost $30-50.
The cooking itself is typical pretty minimal, often just some salt and pepper and then put under a salamander broiler, so the labor costs are less than many other dishes, especially at that price point for an entree.
But steakhouses are typically fancy, prime location restaurants so the rent and other costs are high. And steakhouses make up their margins with the expensive sides (the $12 baked potato that cost the restaurant $1, the $15 creamed spinach, $30 truffle mac & cheese) and the alcohol, whether the expensive cocktails or bottles of wine.
Getting the steak cooked to perfection, cuts that you may not be able to find local to cook yourself( ribeye cap is so hard to find in my area), side dishes you may also don’t wanna make yourself or able to find at other places ( I love bone marrow ) and the staff. Staff is usually amazing due to their pay. For instance , I have had the same exact server each time I visit the place I like to go to when I visit Washington state for over the past 10 years
Higher quality beef has a massive markup compared to a $10 steak at the grocery store. It has to do with how the fat is distributed in the meat, how the cows are raised, and the age of the cows. All of those factors require more work and expenses to make a better quality product.
Then at the restaurant, the higher prices steaks will be dry aged for 30 to 60 days, which requires time and space. Even non-aged steaks will be seasoned and left to dry/come up to room temp before cooking. It’s more work than just marinating a cheap steak.
And finally, there is the increased overhead and staff cost that comes with a nicer restaurant. Better staff and decor come with a price tag.
Well cocktails for example, if you want a ball park price it’s cost of product X5.
£2.5 of ingredients= £12.50 cocktail
Food is expensive right now, and beef especially has a high cost when it comes in the door before you prep or do anything. The steak has to be $60. The real trick is getting you to pay $12-$15 for sides and veggies. That’s where the kitchen is driving food cost to offset beef and fish.
The quality of the meat, Labor for both Front and Back of house staff, along with Food/Drink cost and all other supplies
No cooking, no dishes, attention from someone that does it all day long, higher quality cuts than you may have access to.
Meanwhile you can just sit back and enjoy the company of whoever you’re with.
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