The Economics Of Restaurants

June 21, 2013 in Daily Bulletin

Alex Mayyasi took a look at the economics of the restaurant business:

  • Drinks normally have a profit margin of 80%. The rest of the restaurant? 4%. This is why most restaurants are glorified drink companies, and why Dunkin Donuts recently relabeled itself a ‘beverages’ company.
  • A restaurant in the middle of nowhere expects that its food will be so good it’ll draw people in – these are the best places to go eat.
  • Demographics is destiny for restaurants – they look to serve those in the community around them. Business district restaurants, for example, are aimed at the after-work drinks crowd and probably don’t have the best food.

Read more economic restaurant hacks over here.

Source: Priceonomics