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mikeman
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  • 4 weeks later...
4 minutes ago, Alex smith said:

From an independent restaurateur's point of view, pricing is a matter of custom, meeting customer expectations, and what the market will bear. Another way of thinking about it is that you make your money at dinnertime so that's what supports your fixed costs - rent, insurance, cleaning, prep cook, inventory, etc. Once you pass the hurdle of opening the doors for the day you have to squeeze every last dollar out of the operation, and if that means serving lunch at a lower price to increase volume, might as well. Chain restaurants analyze this in detail, and you'll probably find that most fast food and many casual places charge exactly the same for lunch and dinner. Where it does make a difference, it's primarily a matter of higher demand for fine dining at dinnertime. In markets where this is not the case, for example California wine country (where many tourists are having lunch, but fewer stay for dinner), lunch is every bit as expensive as dinner.The road to hell (and restaurant ruin) is paved with simplifying microeconomics assumptions, but at the risk of damnation here's a hypothetical supply and demand curve for a modest restaurant that serves a single item, say a chicken dinner. Individual establishments don't have supply curves, they have marginal costs.

Excuse me sir. Who let you post here?

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