Sunday, January 22, 2017

The $50 Dinner

People will spend money to eat out - if the food is good and the experience is fun.

Chain restaurants are in the news today - foot traffic is way down, not really recovering from the recession of 2008.   Smaller chains are going bust, others are reporting lower profits.  One exception to this rule appears to be The Darden Group, which used to own Red Lobster, but famously spun it off to a private equity firm.

Daren owns Olive Garden, which seems to have a loyal following, but also owns "upscale" chain Seasons 52 which I wrote about before.   Seasons 52 isn't a bad restaurant, but then again, it isn't a true "upscale restaurant" like Le Cirque or something.   It is the sort of place where cubicle drones can go for a cocktail after work and pretend to be executives.   Or the kind of place you can take a client to without busting the firm's entertainment budget.

The decor is nice, they have valet parking (which only the jerks in look-at-me cars actually use) and they have a nice middle-priced wine and cocktail list.  

It can also be affordable, if you go to their happy-hour which is from 4:00 to 6:30 PM.   They offer a $15 "flights and flatbreads" special - a wine flight of three modest wines ($5 to upgrade to the "acclaimed" list) and a choice of fairly large (12" x 4") flatbread pizzas - with a $5 upgrade for lobster.   Yes, lobster - the lessons from Red Lobster weren't lost, just pushed upscale.  Once you try the wines, you get a full glass of one of the wines of your choice, included, or an extra for $5.   So for $25, we had the lobster flatbread, a three-wine flight, and two glasses of wine.

Not bad, but they also offer "small plates" for $5 each - things like scallops, grilled chicken yakatori skewers, shrimp scampi and the like.   Specialty cocktails are $8 each, select wines $6, and well cocktails $6 each.   If you order a shaken drink, they bring you the shaker and glass, so it is a good bargain.

Total damage, for all that wine, two cocktails, two "small plates" and the flatbread, about $50 - or about what we paid for four beers and four tacos for lunch locally.

Can I afford to eat here all the time?  No.   But since the Darden stock I bought pays a 3% dividend, I can spend my dividend check there once a quarter on a nice but light supper.   Not bad to have an investment you can eat.

They got rid of the piano bar, which is my only complaint.  But the ambiance is nice, and the service is very attentive and professional, which goes a long way toward customer satisfaction.   When the waitstaff acts like they are doing you a favor pouring a $6 beer, something ain't right.

So what's the point of this?   Well, I've said it before and I'll say it again - Americans like upscale things.   They buy BMWs and Mercedes because they want to appear rich.  They wear designer clothes and have the latest smart phones.   And often these are people living in trailer parks or apartments.

The stereotype of the "middle class" in this country as "scraping to get by" is false.   Well, they are "living paycheck to paycheck" but doing so only because they are living beyond their means.  

My advice to these struggling chains is to unscrew all the tchotchke that you put on the walls (that crap is so 1990's) as no one views that as "fun" anymore, just trashy and cliche.   Go upmarket - or at least appear to do so.   Throw a valet parker out front.   Make the ambience quieter and clubby - get rid of those exposed steel beams and A/C ducts on the ceiling - and not by putting in drop panels!   And get rid of the echo chamber effect as well.

Raise your prices a bit, hire better servers, and you'll have them lined out the door!

Middle-class America doesn't want to act middle-class.  They don't want to be ordinary, they want to be special.   So give them what they want, even if it is just an illusion.

And "casual dining" will give way to "semi-casual dining" and you'll make a pile of money.

Just a thought.   People do like to dress up and go out to dinner - not just strap on a feed bag and chow down.