Posted by richk on January 16, 1999 at 09:55:57:
In Reply to: Re: Please explain the wine markup? posted by richk on January 16, 1999 at 09:48:33:
It is all a matter of what you are referring to. Ambiance is a general term which (in restaurants) can refer to anything in the restaurant. Apart from what Francois mentioned, in the nice restaurants, you are also paying for everything from tables, glassware, plates, breakage, etc. The cost of the equipment used to run a restaurant (the ovens, walk in refrigerators, repairs, fuel, heating and AC, lights, etc. Ambiance is the appearance and atmosphere of the restaurant. The same dining room that has 30 tables with 4 feet between each, could have 50 table with 18 inches between each, increasing the seating (and income) potential of the restaurant. That is ambiance.
Whether it seems it or not, as Francois said, the profit margin for restaurants is usually under 3%. All of those costs are justified and the often "thrifty" American consumer simply does not want his meat and potatoes priced appropriately, so the balance of the cost goes to the "luxury" items, the alcohol.
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