Before Covid hit the restaurant industry, if you spent $100 for a three-course meal including a beverage at a mid-level restaurant, it seemed an extravagance. Now, in 2024, you’d be lucky to find any that don’t cost that much and much more.
A 16-ounce strip steak that cost $50 five years ago you’d be lucky to find now for under $65—and it will only be 14 ounces. And the $15 Martini is now north of $20. What is going on?
Well, it’s not gouging: Restaurants considered a ten percent profit a reasonable rate of return when food costs were in the stratum of 25% to 35%. Now it’s tough for restaurants to keep them below 40%. That has to be passed along on a menu but only incrementally. No one’s going to pay double for a bowl of onion soup that used to cost $8.
To read the rest of the story, please go to: Forbes
