We’re taking a look back at some of our favourite and most popular Lifestyle stories of 2023, giving you a chance to catch up on some of the great reading you might have missed this year.
In this story from August, Kim Knight takes a look at some of the post-pandemic restaurant world trends we’ve been noticing - from staggered bookings to table limits to $50 mains and havoc from vegans - and asks the industry to “please explain”.
The tipping point was a blob of pate a choux filled with goat’s cheese and topped with half a cherry tomato.
We’d ordered one $8 pastry apiece from the “snacks” menu of a beautiful new Auckland restaurant. When the $24 plate of fingernail-sized food arrived, I saw red - and it wasn’t just the minuscule tomato.
Name and shame? That was the summer I quickly discovered I’d have to add every high-end Auckland restaurant to my list.
In the past year, the $8 (and also the $12 and even the $15) single-serve snack has become standard fare. It is increasingly difficult to get a glass of wine for under $16. Desserts have jumped the $20 barrier, main meals hover perilously close to $50 and I’m embarrassed to tell my South Island family how much I’m prepared to pay for a freshly shucked Bluff oyster.
But it’s not just restaurant prices that feel harder to swallow (and, also, this is not just an Auckland complaint). Degustation destinations want you in and out in two hours. Twice, recently, I’ve been told there is a 90-minute time limit on my table. That tiny nip of hard liquor some kitchens send out? It might be free - but it’s also a signal you should pay your bill and go home. At 9pm.
What’s happened to hospitality? Top chefs and other experts point to ever-increasing food and labour costs but say there has also been a change in diner behaviour. There is demand for 5pm tables (and fast service) from people who got used to being at home in a pandemic; that “snacks” menu is both a natural evolution of the shared plates phenomena and a way to cater to crowds no longer up for three courses and the cheese platter.
The Restaurant Association of New Zealand put some of our most burning questions to its members. The 177 respondents to the snap survey confirmed at least one of our suspicions - a 7pm Saturday table is becoming rarer than a market fish dish that does not feature snapper.
From staggered bookings to table limits to the havoc vegans are wreaking on the vegetarian menu, we take a look at some of the restaurant world trends we’ve been noticing - and ask the industry to “please explain” via an anonymous survey, and a targeted grilling of chefs and restaurateurs Al Brown, Krishna Botica, Plabita Florence, Peter Gordon and Sid Sahrawat and hospitality business and education leaders Marisa Bidois and Robert Richardson.
STAGGERED BOOKINGS
Why can I never get a booking at 7pm on a Saturday? Do restaurants even make that time slot available?
Survey says: 38% of respondents to the Restaurant Association survey say they make less than 20% of their 7pm Saturday tables available; 22% make 20-50% available; 40% say at least half their tables can be booked in that time slot.
Peter Gordon: We have bookings available online. Many of our diners like an earlier dinner so we’re open from 5.30 and just stagger the bookings the rest of the night so the kitchen and front of house aren’t slammed.
Krishna Botica: We have a little bit of a bell curve that allows 10 to 12 people to book in for seven o’clock. It’s really important to alleviate pressure on kitchens. For us, the bell curve really works, in terms of making sure that we’re not getting heavy slams that create a world of pain.
Sid Sahrawat: We try and stagger bookings. Everyone wants to eat at 7-7.30pm, but then you can’t take any 5-5.30pm or 8-8.30pm tables. In a bigger restaurant, you can’t just have 60 people a night or you’d go bankrupt in two days. You have staffing, you have overheads.
Marisa Bidois: Turning tables has long been a critical part of restaurant operations . . . but if you can’t find the time you’re looking for online, we’d recommend contacting the restaurant, who may be able to accommodate your request.
TABLE TIME LIMITS
Sure, I agreed to vacate the table after two hours, but I’m not done. Given how much money I’m spending, why can’t I have the table for the entire night?
Survey says: Just under half - 43% - of operators impose time limits on tables. Another recent Restaurant Association poll indicates one-quarter of establishments now operate two sittings a night, while 28% say they only had one.
Gordon: It’s a relationship after all. We want you to have the best time and we hope you’d like us to run our business smoothly and efficiently. If you feel you’d like to stay longer just let staff know in advance. It’s likely to not be a problem, so long as we know what you want.
Bidois: Fundamentally, we don’t sell food, we rent chairs to people that eat food and we need those chairs full. If you have a booking at the doctor’s and you have to wait 30 minutes, it’s usually no problem. Whereas in a restaurant if you’re asked to vacate your table or wait for your table, people don’t see it the same way. Tables are part of our product and just as newspapers sell fixed ad spaces, restaurants also need to calculate their spend per chair to be profitable. Some businesses will calculate their profitability on an average spend per night whereas others, particularly where space is at a premium, will calculate spend by chair or table. The reality is that restaurants, particularly smaller ones, need to turn those tables two or three times in one night.
PRICEY DRINKS
I used to be able to buy a glass of wine for $12-$14. Now, $16 seems to be the starting point and prices are routinely topping $20 a glass. Why?
Survey says: In the past six months, 67% of operators have increased wine-by-the-glass prices.
Plabita Florence: I honestly think some areas of a restaurant business have to act in redemption for others. Our alcohol sales are one of those. It’s an area where we can charge more, and so we usually do. There are plenty of parts to the business where we spend money and can’t make much back, and so wherever we can make a bit extra to help balance the scales, we have to in order to survive.
Gordon: Have you noticed the costs of all food and beverage rising wherever you shop? It shouldn’t come as a surprise really. On top of wage increases nationwide, we also need to keep covering our costs.
Bidois: Alcohol excise rates, which apply to domestically produced alcohol as well as duty on imported beer, wine and spirits, increased by 6.6 per cent on July 1 and the latest hike follows a record 6.9 per cent increase in 2022. Labour prices have also increased, on average, 17 per cent over the past two years. It’s not just the cost of the wine, it’s also the labour involved in serving it.
THE $50 MAIN
Menu specials that offer a cut of meat for two at $130-plus - is this just a sneaky way to push mains over $50? (We’ve noticed plenty of steaks sitting at $49 - with vegetables or fries as $12-$15 add-ons).
Survey says: Only 10.61% are currently pricing mains at $50 or more.
Bidois: Restaurants are businesses and the most successful ones are finding ways to add value to a dining experience and charging accordingly for it.
Robert Richardson: There are lots of ways to up the dollar spend per table. Some customers see it as sneaky, but the reality is that the restaurateur/owner will see little of that “sneaky” increase, it’s simply a way of softening the impact of high prices on a diner’s consciousness but still covering costs. Take a snapper dish for example . . . our school pays $38.95 a kilo through KiwiFish for snapper fillets (some restaurants purchasing regularly and in volume will get this cheaper). At five portions per kilogram - 180g allowing for trim and waste - and a 30 per cent food cost, I need to charge $29.86, including the GST margin I have to put on it. And that’s with nothing else on the plate. If I use 50g of butter in the dish that adds another 96 cents, so I’m already over $30. Part of the problem is that New Zealanders only want premium white fish like snapper - even at the fish and chip shop. What actually happens is that restaurants ride with a much higher food cost on dishes like snapper and steak just to have them on the menu and attract customers. Then they will put burgers and fried squid on the menu with a lower food cost and a higher markup to recover some of those costs - hence why burgers are overly expensive for what they are and fried squid is on every menu because its food cost can be as low as 10 per cent and it’s popular.
When I was with Martin Bosley [in Wellington] about 15 years ago we were the first to break the $50 main course mark - it caused all sorts of commotion at the time. But you look around now and there are still very few restaurants that charge that for mains. The margins are just getting smaller and smaller and it’s the restaurateur who has to suck it up - usually by ditching staff or paying poorly.
Gordon: Dining in Wellington recently, mains were often over $50, in Auckland less so. Not sure why, as we pay the same prices in Tāmaki as they do in Welly, but restaurants here appear nervous to charge what they need to. Restaurant costs have increased . . . they do need to be passed on to the consumer.
Sahrawat: It’s not just about the cost of the ingredients. It’s very, very cut-throat in terms of margins. Compare it to some parts of the world, even Australia, some menus have mains around $70. I think our prices are pretty good, for the quality of food and the portions are generally quite decent. In most parts of New Zealand, a steak is 170-180g.
SPENDY EXTRAS
On that note - $33 entrees and $22 desserts are everywhere. What the actual? (Don’t get us started on $30-plus for a big breakfast).
Sahrawat: Restaurants need to make money like any other business. Everyone thinks you have a restaurant and life is hunky-dory. You have sleepless nights, some days you don’t have enough money to pay your bills. You’re chasing your tail all the time. At French Cafe, we’ve got an a la carte menu now . . . Entrees are $35, mains are $45 and desserts are $25 . . . Tasting menus are cool, but what if someone just wants to come in for some snacks and a straight up main? They should be able to do that.
Gordon: It seems many restaurants are increasing starters to the $30s so they don’t need to increase mains above $50. The restaurant will do whatever it needs to do to stay afloat. Margins are tight in hospo - don’t think we’re all flying around in private jets.
Richardson: Cafes have to sell hundreds of coffees to make any decent money. Assuming the roaster hasn’t done a supply deal with you, a cafe coffee machine can set you back $7k. Once you remove the GST, wage cost and food cost portions, you have to sell a lot of coffees just to pay off the machine. You can speed that up if customers purchase food and you can put the correct margin on it. Eggs have just hit $1 each. Just the eggs for a three-egg omelette would require a selling price of $11.50 at a 30 per cent food cost plus the GST margin. Just add some ham and you’re at $18. Long story short, it’s very scary if you own a food business at the moment - a lot of hard work really for the love of it, rather than a true financial return - unless you can do a deal with SkyCity and get them to set you up in Federal St.
Brown: The very basic theory is you buy something for a buck and you sell it for $3. You want a food cost of just under 30 per cent. Sometimes there’s wastage. We serve Bluff oysters, they’re wild, and we shuck them to order. There’ll be four great ones, four middle and then, sometimes, the ones that you can’t serve - “I can’t charge seven bucks for that” - but, you know, they don’t overpack down in Bluff. Suddenly that’s $3 I’ve thrown in the bin. You don’t know what’s inside the shell and that’s no one’s fault, but I can’t and won’t send it out.
FISH OF THE DAY (AND THE NEXT DAY)
Snapper. Snapper. John dory. Snapper. Are there any other fish in the sea?
Brown: We’ve been serving fresh kahawai at Depot for a few years now. It’s half the price of snapper and it eats beautifully. Customers are blown away. You hear “Oh, you have to bleed a kahawai” or “It’s an oily fish and it’s only good smoked.” Sometimes people will eat it raw. Where do these folk tales come from? You can also cook it. It’s a stronger fish than your gurnard or snapper, but we pair it with a garam masala potato and a coconut and ginger sauce. Bigger flavours. It’s a chargrilled, lovely fish dish, and the lower food cost gives us a bit more to play with. If you’re clever, the value proposition is in the eating.
Gordon: Auckland will always feature snapper and in Wellington, it’s likely to be blue cod. At Homeland, we mix our fish up, as many people do, which has got to be good for our snapper stocks.
Sahrawat: We have about four or five fish suppliers who message us every day and then we try and get the best - the likes of hāpuka and kingfish. We find snapper works well for the South Indian sauces so we do use a fair bit of snapper - that’s the only fish we actually state on the menu. Every now and then we use some john dory, a bit of orange roughy, blue cod, and we’ve used monkfish in the past.
THE COVID HANGOVER
The last two years were, arguably, the worst in hospitality’s history. Would you open a restaurant knowing what you know now?
Botica: No. It’s the age that I am. If I knew that my window for failure and recovery was a bit longer then I would. But not at over 50. I feel like the team we’ve got around us is now so insanely good at pivoting that we will weather whatever, but if I was just starting out - I don’t know - the level of stress is palpable.
Brown: Nope. I’m two and out. I have two fantastic eateries that I’m incredibly proud of. They’re a part of the Auckland dining scene as an option every day and every night and I have no ambition to open a whole lot of restaurants. It’s more staff, more cost, more worry and, invariably, if one goes, then the others are helping to prop that up and then they’re not making any money either. You have a big hit with a restaurant and you think, “This is great, I’m making a bit of money, I’ve got this other idea” . . . to me the most important thing is bedding down the restaurant. You’ve got a great fit-out, you’re the talk of the town and everyone’s writing about you, but you’re also in an industry where 80 per cent of restaurants go under within three years. If you can’t understand that stat or you don’t believe it - well, I guess we’re all dreamers and isn’t that wonderful - but, s***, I’d be scared to open another restaurant because I don’t want to lose what I’ve spent years building up. I take my hat off to those who are.
Florence: If my peers are anything like me, you can tell them the stove is hot, but they just have to touch it for themselves to double-check.
CLOSING TIME
I was out recently with a group that spent a lot of money. Some people wanted to stay on for an after-dinner drink, but the restaurant was closing. It was 9.15pm on a Thursday on Ponsonby Rd. When did hospitality start going to bed so early?
Survey says: More than half of restaurants (58%) are closing their kitchens earlier than they did pre-Covid.
Brown: They’re probably smart and they did the maths. Staying open costs - say it’s a couple of hundred dollars, then that’s $1400 a week and thousands over the course of a year. It’s the little things, but they all add up. I worked last Tuesday night and it was full when I arrived at 5.30pm and it had dropped out by 8pm. Look, it’s winter, and I’d like to think definitely this time next year the industry is going to be on a better trajectory, but people are hurting after Covid and it does have a long hangover . . . that said, there’s no excuse for putting up the chairs around people. That doesn’t fall under the definition of the word “hospitality”.
Botica: So much has changed around the drinking aspect of the industry. In the old days of Prego, I’d be peeling people out at 1am, long after they’d finished eating. Now, when you close that kitchen, you’ve got half an hour to get customers out. It’s not just a labour discussion, it’s a licensing thing.
PLEASE ENTER YOUR DETAILS
Why do restaurants want my credit card info before they’ll accept a booking - are they really going to penalise no-shows?
Survey says: A quarter of restaurants request a deposit or credit card details for large groups but only 5.6% say they require this for every booking.
Bidois: It is reasonably common to be charged in some industries if you do not attend - hairdressers, hotels, concerts, beauticians, flights. It’s not commonplace in our industry yet but many are looking at this. As an industry we saw a surge of cancellations as Covid hit . . . our businesses needed to address the cancellations in some way.
Botica: We used to hold credit card information to confirm a table in our private dining room. If they cancelled within 24 hours of their booking and we had no chance of reselling, we’d charge them $250 - which I think we’ve done twice in the last five years. Everyone’s got a different business model and if places don’t take walk-ins it is far harder for them, because they might staff according to the number of bookings. If you’re a French Cafe and six people don’t show, what’s the likelihood that you’re going to get six walk-ins for a full degustation? If I had a business like that I would be all in on that particular type of policy. And, also, it’s about respecting the establishment as a business, not just a service. Covid has moved the dial on this somewhat. I really feel some people used us as more of a service . . . and I would say now, the conversations you have are far more real. People are thinking more deeply about stuff.
DIETARY REQUIREMENTS
Have vegans ruined the vegetarian menu? (aka what if I really want cheese on my mushroom risotto or butter in my carrot soup?).
Survey says: 33% of restaurants offer a vegan (but no “vegetarian”) option; 46% have separate vegan and vegetarian options and 20% have neither (but will provide a suitable meal on request).
Brown: If we do an event I never use the words “dietary requirements”. It’s allergies only. If you’re going to die if you eat a peanut, that’s good for us to know. But I don’t care if you’re not eating bread this month or you don’t like beetroot. The diner needs to play a part - look at the menu a few days before and give us a heads-up. It’s very hard, on the fly, when you’ve got tonnes of orders coming in. Kitchens are highly tuned, relatively anxious places . . . if you suddenly throw in a new song in the middle of it that no one knows, it’s very hard to stay in tune. We try and look after everybody and we go through the menu with them. “That relish on that dish is vegan, and this here is also suitable” et cetera. It’s not extra work for us, we’re just putting things together differently.
Gordon: We tend to have vege dishes that we can usually make vegan. Sometimes though the vegan dish is stunning so it’s worth the conversion.
Florence: I can definitely see both sides of this dilemma. I’ve been vegetarian my whole life and I can say when eating out I’ve definitely been lumped with, not only the vegan but also the gluten-free option. On the flip side - we get plenty of people into Forest who are intrigued by what the food is and want to try it, without mention of what it’s made without. I think chefs can get caught in this small-mindedness - they need their vegan/vegetarian/gluten-free option to tick a box on the menu, and rather than make it something creative and interesting they just whack together something and call it a day. It isn’t really that hard to make something vegetarian which could also be made vegan. Or actually, the vegan option doesn’t have to be a bad thing. This area often seems to go without much care and attention. Cooking without animal proteins takes a little more imagination.
SNACK ATTACK
Expensive chef’s folly or the best part of a modern menu? When (and why) did individually-priced “snacks” become the biggest thing since sliced bread?
Survey says: Around 17% of restaurants offer a dedicated “snacks” menu with the average “per piece” price ranging from $4-$10.
Gordon: Small, precise, delicate, with big flavour - a chef’s dream. And you can get more money per gram than a main course so it really helps the bottom line.
Brown: People eat with their eyes . . . if it was a tiny bowl of cauliflower soup with a drip of truffle oil in it, you’d be, “Oh, this is delicious for $8.” I heard of a restaurant recently where the first course was a leaf. It probably had a drop of oil on it . . .
Sahrawat: Go anywhere in the world and have a restaurant experience and snacks are often the favourite because it’s like a series of mouth explosions. In some places, the portion doesn’t resonate with the price. But, you know, say it’s got crab in it - crab is like $100 a kilo, before GST. So it might only be a small amount, but it’s not cheap.
INDUSTRY SNAPSHOTS - selected Restaurant Association survey responses (submitted anonymously)
On wine price increases:
“We have also adjusted the pour volume.”
“We’re holding prices until September, which we see as the start of our new season.”
“We’ve matched suppliers’ price increases.”
On table time limits:
“On Friday and Saturday nights, these are enforced, but on weekdays we tell people they can ignore the limits.”
“Early tables have a two-hour limit so we can rebook them.”
“No limit, but we do encourage guests to buy more if they have planted themselves during busy times. This normally gets them to move along.”
On menu prices:
“We notice more people sharing meals than previously.”
“We are selling more cabinet food as customers become more price-spend conscious.”
“We’ve increased our prices 10-20 per cent (and more for some meat-based items) to cover increased food and labour costs. Customers seem to understand and accept this.”
MEET THE EXPERTS
Marisa Bidois - Restaurant Association of New Zealand; Krishna Botica - Cafe Hanoi, Perch and Ghost Street; Al Brown - Depot, Federal Delicatessen, Best Ugly Bagels and Tipping Point Wines; Plabita Florence - Forest; Peter Gordon - Homeland, the Food Embassy for Aotearoa and the Pacific; Sid Sahrawat - Sid at the French Cafe, Cassia, Kol and Cassia at Home; Robert Richardson - Culinary Arts and Gastronomy, Auckland University of Technology
WAITER, WAITER, THERE’S A COST INCREASE IN MY SOUP: Thoughts from an international restaurant coach
It’s the news no diner wants to hear - dinner is going to get dearer.
At a recent local hospitality industry gathering, the takeaway was clear: “If anyone didn’t raise their prices four to six times in the past 12 months, you are behind the curve of participation,” said Chip Klose, visiting American restaurant coach.
Klose, keynote speaker at the Restaurant Association of New Zealand’s annual hospo hui, told participants what they were offering was a luxury - not a commodity - and they had to shift their mindset.
“The restaurants that succeeded over the course of the pandemic were the ones that understood their customer. You used to come to me for this. I can no longer provide you with that, but what is it you need? How can I provide that? And I have to understand what it’s worth to you.
“Value is the space between what we charge and what it’s worth to the guest . . . there’s a lot more being traded than a well-cooked piece of halibut.
Klose, whose restaurant résumé includes New York’s iconic Gotham (where waiters would send a pasta home with a diner to gift to their driver - “pasta’s cheap, we thought one step ahead and the customer looked like a benefactor”) recently spent a week in New Zealand, speaking at the hospo hui and running a follow-up workshop.
“I have a lot of conversations with restaurant owners who struggle with profitability. And that bothers me because what we do is so beautiful and special. We celebrate the biggest moments of our lives in a restaurant - we don’t go to an amusement park or a rugby match.”
And diners need to pay a price that reflects that experience.
“When the cost of goods goes up, when wages go up, we as consumers have to be willing to pay more - and the restaurant has to create an experience that’s worth the new rate.”
What are the five stories only your restaurant can tell? What is the customer pain point that only your restaurant can solve? Klose says these are the sorts of questions operators need to ask themselves as they recover from Covid.
“We have very few watershed moments, and that was a watershed moment. Every time we go through a major cycle, there are restaurants that don’t make it. The pandemic sped that up. We have very few of those watershed moments. Dining changed because our work-life changed, our behaviours changed . . .”
Klose says in the United States the majority of independent restaurants never make more than 7 per cent profit.
“For every $100,000 we generate in revenue, the investors split $7000? It doesn’t make sense. And if the finances are that tight, we’re going to stop having really great restaurants, because no one is going to invest . . . every other industry in the world makes 20, 30, 40 per cent profit margins.”
This story was originally published on August 19, 2023
