Why Dining Out > Eating Out

The definition of hospitality to me is — people who create an environment or a space that they love, while taking care of one another, and making it their life’s purpose and passion, whether that be in a restaurant, hotel, spa, or as a host in your own home. 

The definition of hospitality in the dictionary is — ”the friendly and generous reception and entertainment of guests, visitors, or strangers.”

My History:

Hi, I’m Alex, and as you know, I’m obsessed with the restaurant industry and the people who pour their souls into it just as much as I am obsessed with the emotion of finding the best new taco or whole fish to swallow within minutes of discovery. While I’ve been doing PR for restaurants as my career since I was 22, it wasn’t until the last few years that I learned my great grandmother was a baker in Poland and my great grandfather sold pots and pans. On top of that, my cousin started the restaurant Hill Country BBQ in NYC after modeling it after Kreuz BBQ in Lockhart, where our family immigrated to in the early 1900’s. Food is in my blood! My mom keeps our family together through food with BBQ Sunday lunches in Houston, a full house at Thanksgiving and Passover, and an extended meal period for dessert, as that’s what us kids and my brother’s kids search for before the savory part of the meal is even served so we know what to look forward to after. 

As I’ve worked really hard to build up chefs and restaurant owners businesses while making a name for myself as a go-to person for restaurant recommendations and a connector in town, I feel it is my duty to help share what goes on behind the scenes of trying to build a brand and why things cost what they do. I’ve worked with more than 100 different restaurants in both NYC and Austin and have opened a total of 50 from the ground up, so I’ve seen what it takes from a PR/marketing side, what customers want, and how chefs/partners traditionally run this business and how this is changing.

THE CHANGE:

Let’s start with 2020 when restaurants shut down and people started learning how to make their own sourdough and restaurant items that take hours and years of training to learn how to perfect. Imagine doing all that, while also managing and continuously hiring/training staff, calculating produce orders, maintaining the building aesthetic, paying rent, accounting, and dealing with customers. It’s an entire operation to make things go round. 

As Sara Mardanbigi, partner and owner at Nixta Taqueria puts it, “Okay, you can make the argument that it’s cheaper to cook from home. Let me know after making tortillas (starting from a hard corn kernel), using things from your garden or a local farmer, cooking it, plating it, setting the table, selecting a wine, pouring the wine, washing dishes, etc., what [the cost] amounts to.” 

There’s a morning team that helps with prep, and if there are bakers, they sometimes go in as early as 4 a.m., while the managers might lock up the night before at 1 a.m. depending on what city you live in. Owning and working in a restaurant is like a 24-hour operation that never stops, they even clean the floors and pick up trash if you watch closely! Anyway, it seems like there was more respect for the hospitality industry after we saw the conditions and people they had to deal with during the pandemic, and we saw a lot of people flee these kinds of jobs for remote jobs when they found it was possible to avoid unpleasant customers. 

What we also saw was the increase in rent and demand for land in Austin, as well as an increase in cost of goods and materials and owners wanting to pay insurance and higher pay to employees to give a better life to industry workers which hasn’t ever been standard for a small owned restaurant. It’s usually just the corporate ones that can afford it.

THE COMPLAINERS:

When I moved back to Austin to be the Communications Director at MML in 2016, everyone would tell me in the same sentence that I worked for the best restaurant group in town and that that same restaurant group is so expensive or overpriced. Yet, they’d still say, “I only eat there and they take all my money!” The phrase “overpriced” always strikes a chord with me when talking about food, because I think these people don’t understand what they are paying for – this is not a grocery store, so your roast chicken is not going to cost the same price as HEB’s rotisserie chicken and your spinach salad is not the same as bagged lettuce… think about it. This is an operation that offers hospitality (see definition above), nice art, furniture, quality staff, cool events, style, music, etc. 

As Todd Duplechan, chef and owner of Lenoir and Dovetail says, “The restaurant business doesn’t run like any other business. Trying to apply how things operate at your company to a restaurant doesn’t work. We are a factory, a sales force, an artist commune, accountants, therapists, and it’s all open to the public and half the people [at the restaurants] have been drinking.” 

We go to restaurants for entertainment, connection, conversation, celebration, and food. This is like the theater or a sports game… Now, the drinks and food THERE are overpriced, hehe. I have said I thought a certain new restaurant in town was too expensive recently, but that means that I think it is too expensive for me personally, therefore I chose not to spend my money there. I often think about industry leader, Arjav Ezekiel, from Birdie’s, when he posted a review from a customer who was complaining about the prices at his restaurant, which, by the way, won Best Restaurant of the Year by Food & Wine. This is my paraphrase, but he commented to this person that the prices are online and visible for all to see so they could see before they chose to eat there and didn’t have to come and complain about it as it’s their choice. I respect that so much and often think about it now in my own experiences. 

Why are people complaining when it’s visible how much things cost? Do you buy a ticket to Taylor Swift and complain about the price or a pair of designer jeans? No, because you want it, so if you want to dine out, you have to respect these artist’s craft as well, or you can choose to not buy into it. I reached out to Arjav and he told me, “Tracy (his wife, partner, and chef at Birdie’s) spent 15 years making $8 an hour to perfect her craft, and in any other field, like a lawyer, you’d be okay with paying for their experience, as the more experience you have, the higher the rates should be, but for some reason in restaurants, that is not the case. It’s important to know you aren’t just paying for the cost of food, but for everything that it takes to put that plate in front of you.” 

Sara of Nixta has a similar opinion, saying, “You have the choice to go where you want. If you look up our menu on our website, and you’re like “Holy shit, $13 for a tuna tostada?!,” then it may not be the place for you, which is totally okay, but if you’re doing any due diligence on a place, and are still unhappy about pricing, there should be a little accountability.” 

Restaurants bring so many people joy, which is why people spend so much time picking out their reservation for their anniversary, birthday, best friend coming to town, or a special dinner with parents. Restaurants take care of people, feed their soul, and want everyone to have a good experience. Managers and bartenders can see a whole family grow up from when a woman is pregnant to the child graduating from high school and they are truly invested out of kindness.

“The most important thing if you are not having a great experience is to say something while you are there,” explains Arjav. “We live and thrive on getting it right, and we want to go out of our way to make exceptional hospitality. We can’t do that if the first time we hear about it is online, and we want to hear about it while you are there, so don’t feel awkward.”

“We generally bend over backwards to make sure you’re having a damn good time, and if you’re not, we usually try and rectify it with a free glass of something, or a free dessert, or comp it. There’s a double-standard in other industries with this — a lot more is expected of restaurants to appease those who are defining whether or not you ‘live up to the hype,’” adds Sara of Nixta.

To the people that say they don’t want to tip or have 20% included on their bill at a restaurant because the staff should pay their own employees, it’s just not possible with the low margins in restaurants. 

“It is your choice to leave a tip. At this point, I am tired of the argument of ‘Well, the employer should be taking care of that for their employees.’ To a certain degree, they aren’t wrong, but from what I’ve witnessed, those restaurants who have done automatic service fees or bake it into the price are also scrutinized. Do what feels right. Tip if you want, or don’t tip. It’s all the same to me. I do agree though that restaurants need to pay their employees more, but sometimes it’s just not feasible, which is why tipping still exists,” adds Sara. 

From what I’ve learned and witnessed, you don’t actually start making real money until you expand and have multiple restaurant concepts – Hillstone is literally the dream of every chef I’ve ever worked with! The consistency, the customer loyalty, the service is all maintained with each expansion and is really hard to do right.  That being said, I’m getting off track. What I want to accomplish here is describe and educate what costs go into running a restaurant as it’s not just the price of food and you also have to pay for the chef’s craft and expertise.

WHAT IS TRUE:

What I can tell you about why pricing is going up is that things just cost more today and people crave a brand and cool experience — not just four walls and a menu. Guests choose where they dine not just based on the menu but from seeing a cool website, branding, collaborations, interior design, wallpaper, colorful tile, bathrooms, Instagram account, illustrations, patio, cocktail glasses, plateware, marketing and PR, etc. So if this is what helps make an experience even more enjoyable and ecstatic, who pays for that? Who pays for the website, high rent prices, OpenTable fees, electricity, air conditioning bill in the summer, graphic designer to make flyers for guest chef events, photographers for press and promotion? 

Todd of Lenoir tells me, “60% of the money that comes in goes to pay for food, beverage and staff. From the remainder, we have to pay for rent, credit card fees, utilities, taxes, POS, maintenance, inspections,  licencing, PR, plates, glasses, silverware, linen, uniforms, menu printing, pots & pans, fuel, insurance, accountants, CPA and on and on…” 

We haven’t even talked about the food yet… which is apparently “so overpriced.” Do you see what I’m getting at? All of these tools that make a restaurant inviting and feeling cool have nothing to do with the part where you have to buy food and hire and teach people to cook it! So yes, this is why restaurant margins are so small. No one wants to pay $6 for a chocolate chip cookie that might take a few days to make from the best butter or fair trade chocolate, but people are willing to pay $20 for a Ranch Water that took 2 minutes for the bartender to put together at that moment. This is why food trucks can charge so little — they don’t have all of these fees, so if you see a taco at a food truck for $3 and one at a nice restaurant for $24, just remember what else the restaurant has to pay for. 

I also like to remind people that who you dine with and your company is a big factor in how food and the restaurant can make you feel. I’ve been to a restaurant that was hyped up so hard, and I didn’t like it and I blame it on the conversation I was having because when I went back with some of my favorite people it felt completely different. Food and experiences are emotional.

In Conclusion: 

Restaurants are a source of community, happiness, gathering, connecting, and joy. I feel like I have to protect these people that give up so much for us to have a place to enjoy this type of theater entertainment, if you will. Remember that they don’t get Saturday nights or every holiday off either! I remember the owner of one of my clients here in town, who has had a successful restaurant for 16 years, once told me she had to work a double shift because her chef got sick and the air conditioner broke and she had to also figure out how to fix it so as to not cost her a fortune, while also taking some photos of a new brunch special to try and promote that night on Instagram before the morning. Let’s just say these people DO IT ALL to make us happy, and it’s not all sexy men like The Bear. 

What I really want to point out here, is the restaurant industry is fueled by people that like to make others happy through food, while also supporting their staff and trying to keep costs down for customers but also provide living wages for their team. They are doing their best, and if you can do your best to understand the sacrifices and hard work, then I hope you can respect the industry a little more before you complain or say a place is overpriced or a loaf of homemade bread is not worth it because it doesn’t meet your grocery store price standards with heavily processed wheat. JK, I don’t know if that part is true, but it felt like it could be. The bottom line is, you get to choose where you spend your money, and the chefs get to choose how they want to support their staff, and if they want to use the highest quality ingredients to make a product they are proud to sell, then let the people who appreciate the craft buy it and support them.

Rania from Bufalina puts it really well, explaining, “Dining at a restaurant with heart is like enjoying a piece of art — everything is thoughtfully crafted, from the locally sourced menu to the music that sets the vibe. But the costs behind this experience are constantly shifting. Food prices can spike unexpectedly, and high gas prices not only impact deliveries but also raise our operating costs overall. The average profit margin for restaurants is generally between 10-20%, which is incredibly low. Our goal is always to create a welcoming space with great food and genuine service, and we want our team to make a good living, but when costs go up, prices on the menu have to follow. So, if a place always makes you smile, know that your support helps keep it thriving despite the challenges.”

I am just here to show you the other side of thinking because I also hear a lot of people ask why restaurants close and it’s because it costs so much to keep it going. We each have options and can find restaurants that fit our wallet and emotional needs, but let’s not tear down the whole industry if it’s not a price you want to shell out. Think about dining out as a vacation and something you look forward to, and if the place doesn’t match your expectation, you can always just go back to your favorite trustworthy spot. I believe there is room for everyone and every style of dining and that’s why it’s great to experience each style and see what makes you feel your best!