> I guess I could write a very upset article about how my local mexican restaurant is SERIOUSLY SCREWING ME OVER with their drink prices
I notice that I drink less (too little, even, if I'm out for an evening) because of these prices. If each drink costs a few euros for 200ml glasses, I'd be crazy to drink a liter if at home the cost is somewhere between negligible (tap water) and 1.50 for that whole liter.
What I don't understand is why they can't spread out the profit margin. It'd make me feel a lot better about buying drinks and I'd probably spend more than I do now. Courses are a few euros in ingredients but I don't hesitate to pay €9-15 for it because I know labor is involved and someone has to pay rent. For drinks there is hardly any labor or ingredient cost (assuming all I ask is tap water, which is often since Dutch tap water tastes better than bottled water, and it's not cooled). Prices might also be higher because people don't order it in great quantities, which they might if restaurants wouldn't inflate drink prices to pay for rent (and other such costs), which would be so if you just pay per hour for a seat or something. I heard some places in Italy do that and people were surprised to be charged for it, but it's just itemizing costs and in my opinion more transparent.
People just don't behave rationally to this. Restaurants learned ages ago that people focus on entree pricing, as a result their is little to no margin on many main dishes (sometimes even negative). This is made up on wine, desserts, things that people have price elasticity on or poor information or both.
All that said, the operating margins on high end restaurants are ridiculously low. Franchises and fast food do better at this (economy of scale), but if it is a proper linen-table-cloths and local sourcing sort of place, they are playing with very thin margins at the best of times.
That would be workable if humans would be perfectly rational, but they are not. If I set up a pizza shop with totally fair prices across the board, my pizza will cost 8 EUR and the drinks maybe 1 EUR. The pizza shop across the street will however put up a ginormous billboard advertising their 5 EUR pizza with a peace of free pizza bread (and have the 3 EUR drink prices in the small print menu). I get very few customers with my "normalized prices pizza and drinks" billboard. Most people would be just like: WTF? and go to the other shop.
I notice that I drink less (too little, even, if I'm out for an evening) because of these prices. If each drink costs a few euros for 200ml glasses, I'd be crazy to drink a liter if at home the cost is somewhere between negligible (tap water) and 1.50 for that whole liter.
What I don't understand is why they can't spread out the profit margin. It'd make me feel a lot better about buying drinks and I'd probably spend more than I do now. Courses are a few euros in ingredients but I don't hesitate to pay €9-15 for it because I know labor is involved and someone has to pay rent. For drinks there is hardly any labor or ingredient cost (assuming all I ask is tap water, which is often since Dutch tap water tastes better than bottled water, and it's not cooled). Prices might also be higher because people don't order it in great quantities, which they might if restaurants wouldn't inflate drink prices to pay for rent (and other such costs), which would be so if you just pay per hour for a seat or something. I heard some places in Italy do that and people were surprised to be charged for it, but it's just itemizing costs and in my opinion more transparent.