The Economics of a $32 Single Crab

The crab dish is actually priced lower than a 25 percent food cost would dictate. Centeno’s cost is $8 per crab — which, he says, is almost double what it was last year. He explained the pricing of the dish as follows:

There’s a little bit of wiggle room to go up or down based on general pricing on the rest of the menu, but the goal is to have it level out to 25%. So a dish with a little lower raw cost may be costed at 23% so that something like soft shell can be costed at 28%.

Soft-shell
3.6 x $8 (item cost)=$28.80 (28% foodcost)
So normally my formula would be:
3.6 x $10 ($8+our cost for the remainder of ingredients on the plate) = $36 (guest price)
I knew $36 was not gonna go over well, and that I had to stay in the 27%-28% range and price it at $32.

But they are delicious and people seem OK with price. They would be much cheaper if I bought frozen, but for me it’s about the ingredient’s quality, so what’s the point then? It’s always about balancing portions and plating to be able to use the best ingredients without breaking the guest’s wallet. Which is becoming more and more difficult.

Do you know how much your signature dish costs? Reach out here to find out more.

http://www.laweekly.com/restaurants/chef-josef-centeno-and-a-critic-besha-rodell-discuss-rising-restaurant-prices-8164532?mc_cid=a4972e0183&mc_eid=76b145f694
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