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Come on Down to Crazy Stu’s!
October 5, 2007

Picture me wearing a large (extremely large) cowboy hat and chef whites out in front of my restaurant, in front of a big banner over my door reading, “Come down to Crazy Stu’s, where our prices are so low, they’re just plain INSAAANE! Save big, ’cause we’re slashing prices and EVERYTHING MUST GO! And if that ain’t crazy, I don’t know what is!”

OK, maybe not.

Sometimes I feel that a few restaurants around town should just cut through the b.s. and put that banner on their doors. For example, a major, local hotel downtown with an award-winning, fine-dinning French restaurant is offering a bistro- and small-plates menu with “happy hour” prices from 4 p.m. to 6 p.m. and 9 p.m. to close nightly, and all evening long on Thursdays. That means that a Dungeness crab cake that regularly sells for $12 is $5, and a $14.75 selection of cheeses is $4.75.

Why should I care? It is downtown, and I am across the river in the north end of the city. It is a large hotel and part of a large restaurant company, so it can absorb the high food costs associated with these happy-hour schemes that try to bring in dollars to cover their overhead.

I care because, as a consumer, I always have felt that happy hours are like the recent iPhone debacle (in which the company lowered the price on the new product by $200 a few months after it debuted). If I got to a restaurant that has lower “happy hour” prices, paying full price during regular hours makes me feel like a sucker, as though I am being ripped off. I also care because I’ve fielded several phone calls recently asking if we have a happy hour. I tell them the answer is no, and then I explain that Terroir’s menu and wine-list structure makes the idea of happy hour moot. I have menu items that range between $3 and $10 and beverages that begin at $2 (for tastes) and move up from there—all day, every day, period.

You may say that’s just INSAAANE. But my business plan projected an average cost of goods sold (food, nonalcoholic beverage, alcoholic-beverage and retail raw-material costs) at 32.5% of total sales. As of the end of September (our first 3½ months in business), my average cost of goods sold stands at 34% of total sales. Not bad, given the first month or so of worrying less about costs and concentrating on getting our hands around this slippery monster.

I keep hearing that happy hours are another way to attract customers. Is it the “get any dollar into the establishment at any cost” idea? Is it the “get them in and they will become regular customers” idea? Or is it the “everyone else has a Happy Hour, so I must have one, too” idea? I don’t happen subscribe to any of those philosophies. I based my plan on the idea of quality, consistent products priced at a good value to our guests without the associated pretentious b.s.

I don’t have a hotel full of guests to keep on site, or a corporate structure concerned with guest counts and same-store sales growth. I do have an underserved neighborhood, and Portland seems to have a taste for the real deal: a restaurant with honest passion behind what it does. So far it seems to be working, but as I have said so many times before, only time will tell.

And the journey continues.

Cheers!

Stu

Comments or questions? E-mail Chef Stu at StuStein@rimag.com.

Posted by Stu Stein on October 5, 2007 | Comments (0)