Q. My company had a great year this year, and I thought I pay back my customers and employees by throwing a Christmas party in an upscale place. I called one of your favorite restaurants and told them we’d like to take advantage of their famous lunch special for a seated lunch for fifty people. I was very surprised to be told that they would not allow us to get the lunch special, and that we had to go along with their banquet menus. The food sounded good enough, but the price was about twice that of the lunch special. I thought this was a ripoff and told them so. Why would a restaurant turn away business like that?
A. To make a long story short, it’s all about supply and demand. Fifty people must either be served in a private dining room, or in a main dining room that will probably have to be closed to other diners. Not many restaurants have much in the way of private rooms big enough for your group. And Christmas is a time when the demand for private dining space and the personnel to serve it are at peak.
The bargain lunch specials–to look at this from another direction–have a specific function: to make friends with in local customers, so that when those customers want to do something first-class they will remember the place. Big restaurants have to make a profit somewhere (lunch is marginal for them), and their bigness is their top-shelf asset. Covering the fixed costs of keeping up those private rooms throughout the year is an issue, too. If what you want is a good price more than anything else, you will find a greater welcome on a Tuesday in late August.