Why America's Restaurant Bubble is About to Burst?

21.44 restaurants per 10,000 people is only 466 per restaurant. If the average restaurant needs 200 customers a day to break even, then on average those those people need to eat out around two or three times a week.

A significant fraction of the population rarely if ever goes out to eat (children, old folks in assisted living, thrifty striving immigrants), so the ones who do go out need to pick up the slack.

Oh, right. Finance someone else’s business at the price of your own financial security. Lovely.

Why are you on these forums if you hate restaurants that much?

Genuinely just curious. We support their evil here it seems like.

I enjoy cooking more than eating out. But I/we eat out plenty. But we don’t spend a lot of money on most any meal The most ever was in Barcelona and that was (I had to look it up) was 145 Euros. Our usual meals out are lunches and breakfasts - almost always less money than dinners. So those people who aren’t eating out or not eating out very often or not spending a lot of money may not be poor. They may be really smart. Preparing for their future. If they lost their jobs tomorrow, they might make it.

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Can’t imagine living life like that, but of course I have the option not to. Seems like we should be trying to create a country where that is not a reality.

Do you imagine everyone else here is on the verge of death?

Well, I’d say there are few on this site who are independently wealthy as you must be. To remain remotely on-topic, most people have to choose how they’re going to spend their money. Dying is easy :slight_smile: Living remotely well until that day generally takes some planning and compromise. Also as a former CH and friend of mine said - and he makes plenty of money - referring to why he wouldn’t go to The French Laundry. He can have a bunch of super meals for the price of one there. Makes sense to me.

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Yeah, because TFL sucks:

You can’t eat anything like Saison for less money unfortunately.

But those are a severe minority of restaurants. So you’re cool with people eating at like Bestia? Just not TFL?

I agree, if you can cook at a super high level going to restaurants may be pointless, but for my part, I’m a talentless hack that can’t cook magical food the way talented chefs can.

So, patronage, in the sense not only of patronizing a business but a patron of the arts. In this case, the art of cooking (and cleaning up afterwards).

It worked for the Medicis…

By “need to pick up the slack” I mean for the per-capita number to be so high.

Do those numbers include take-out?

’ but for my part, I’m a talentless hack that can’t cook magical food the way talented chefs can.

But we still adore you!
:tongue:

The older I get the more I start thinking about saving $500 for that bottle service and getting the same bottle for $50 at Costco and mixing drinks elsewhere…:cocktail:

Don’t get me wrong, I love to go all baller on eating out, all around the world but most of the time, I find some of the best are those divey nuggets of goodness restaurants that save Mama money and I can be big man on campus, buying drinks for others, giving my money away to those who need it or save it for a rainy day…

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Are they using adore to mean “filled with seething hatred for” now? I need to update my dictionary! :smiley:

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Filled with seething hatred…for now?
That’s funny…
No, I adore you now and when you go off the rails…:kiss:

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Who knows what those numbers are? I sent a message to thrillist asking.

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The secret is that I’m always off the rails! :smile:

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At least for the restaurants I am involved with, take-out oftentimes can amount to over a 1/3 of total gross receipts. Of course those establishments are dry.

Restaurant economics are difficult - generally, only the best survive…“best” in terms of business model, with great food being only one of the factors for a successful business model.

But in my outsider’s opinion, I got the sense that AQ didn’t have a great business model. It didn’t have great food, and it didn’t have anything that in lieu of that to gain the necessary traction to sustain itself in San Francisco’s competitive environment.

The food was generally competent, but a bit hollow and trendy. Trendy not in a positive sense here, but in the sense that they never really established an identity or reputation. It moved from New American small plates to mid-priced foraged tasting menu, then was diluted by its next door neighbor TBD which started as a live hearth restaurant, then was revamped as elevated Mexican in Fenix. It was very much mid-tier, and mid-tier is very often getting squeezed out. Yes, a Michelin recommendation/star can be make or break for that segment, and there are too many hotspots in that range that capture more interest from the Eater crowd. AQ lacked an identity and it felt corporate-trendy, with “farm to table,” or its sister restaurant’s live hearth cooking, or high-end Mexican, or whatever, as a marketing point, not a chef-driven ethos to which diners would really respond. It wasn’t cheap, but not too expensive; not bad, but not great, either. Very much a mid-tier, “not bad” option, and that’s not enough to cut it when there’s so much competition.

AQ’s story may represent many other restaurants in America that are folding within the first few years of opening. There are lots of forces at play here, but I see at least a few things:

  1. Diners are getting increasingly selective, if not also aspirational. Mid-tier restaurants (not only in price, but also in terms of food) are fairly quickly forgotten, and it’s hard to regain traction in this instagram age in which people quickly move on to the next hot thing;

  2. There’s so much choice that many of these restaurants blend together, or are interchangeable (aren’t so many menus easy to predict now? almost a paint-by-numbers exercise…charred octopus, blistered shishitos, Cal-Med New American with Japanese ingredients, pastas, and an expensive shareable meat option, of course);

  3. There are too many restauranteurs who are eager to capitalize on food culture, but don’t have a great pulse on what makes a restaurant have lasting appeal, and so their business plan results in such mediocre or good-but-not-great restaurants;

  4. The economics of running a restaurant, especially in a place like San Francisco, are very tough. Margins are slim and some slow periods or bad momentum can really tank things. If you’re in a Michelin price point, but don’t get the Michelin nod, it’s very much an uphill battle.

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I thought AQ was doing some of the best food in the area when it was in my regular rotation.

Y’all aren’t even going to quote the best part of the article?

And now opening a sit-down restaurant is like walking into one of those machines in roller rinks where you have 30 seconds to grab as much money as you can, except all the money is fake, minus one lottery ticket taped to the bottom of one of those dollars. And that one lottery ticket is a restaurant unicorn like State Bird Provisions or Momofuku Ssäm Bar or Rose’s Luxury or Au Cheval.

And if you happen to be the lucky owner of that ticket, you cash it in and head back to the restaurant casino and buy more chips and take them to a higher-limit table and keep betting on yourself and your food and your people and you hope that your wherewithal and previous luck and skill keep it all going, and you become a place like Zuni Cafe or The Spotted Pig or, hell, Commander’s Palace and you’re able to last into paying off investors and actually making a living and becoming the nostalgia pick, the place everyone goes to recall that feeling they had when they walked in and discovered that the food you make is art, and you are a national treasure.

And then your lease runs out, your landlord sells to a developer, and they triple your rent.

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