I learned a bit when I owned a piece of a restaurant about costs, the ideal was for food costs to be about a third of the menu cost. Labor costs were of course high even paying a pittance, we still had two GMs on salary. The service on the debt was a heavy burden. It was very tough to be profitable, the core idea was to break even on food and make money on alcohol. The servers of course made money on tips more than salary, but they had to share with the bar and the front end.
Then we lost our chef and it was downhill from there, he was really good.
restaurant business is
tough. imo the only way you can make any real money in the restaurant business is if you rip your customers off and you get them to gladly be ripped off with a smile on their face. you can only do that if you have a really good product and the place becomes a "hot-spot". Impossible to predict that sort of thing though.
there's a restaurant called Cafe Martorano's in Ft. Lauderdale - really excellent Italian-American spot, but the prices are literally insane. He is price gouging and ripping people off blind. But they pay it happily. But....the guy gets it and has got it for 30+ years and largely because it just became a celebrity hot-spot. Athletes, actors, rappers, singers- someone is always hanging out there. I've seen Dennis Rodman there, Shaq there, Dan Marino, Fat Joe - there's always someone there. And a lot of these guys fly the owner out to cook for them in their own homes. Like Shaq. Shaq ate there like damn near every night when he played for the Heat became friends with the owner and he flies him out to cook for him and his family.
Haven't been there in a minute, but 1 meatball with a little bit of ricotta cheese and some salad is around $30 I want to say. You take a girl there, two people with appetizers, entrees, desert, and couple drinks- easily over $300. For Italian-American food. That stuff isn't
that expensive to make, believe me I know. And it's not like he has to pay an expert skilled pasta maker to hand make pasta- all their pasta is dried.
Not knocking him, the food is excellent but the prices are astronomical for what it is.