Wednesday, October 17, 2012

The real cost of restaurant food?

When a lot of us go to a restaurant, we’re not quite sure why the price of a plate of potato wedges or chicken wings is what it is. This usually leads us to believe that the restaurant is pricy. What most of us don’t realize is that the process of pricing a menu item is a very complicated equation. Things like the cost of raw ingredients, rent, salaries, electricity and water all make up the equation. 

Let’s take a simple example of the chicken wing; if the cost of 1 kg of chicken wings is Rs. 280, we get 4 plates from 1 kg of wings, this implies the cost per plate is Rs. 70. The other ingredients that include honey, herbs, seasoning etc. cost Rs. 15 per plate. The cost of fuel being burnt is Rs. 10 (remember the cost of commercial gas is 3.5 times the cost of domestic gas), baking the wings in the oven results in electricity of Rs. 10 being used (a small restaurant pays about Rs. 50,000 in Bangalore for electricity). The salary of the person making this is about Rs. 50 per hour & the salary of the waiter serving you the dish is about Rs. 40. All this adds up to Rs. 185. On top of this take the astronomical rents restaurants have to pay, the large sum of money that has been invested in opening the restaurant and there is the salaries of the manager & owners. Add all this and suddenly you’ll be surprised if the cost of wings cost you less than Rs. 380!

So the next time you’re tempted to complain about how expensive a plate of chicken wings is because you had to pay Rs. 250 for it. Think again!

No comments:

Post a Comment