

Why Don’t Restaurants Charge for Reservations? - adamcarson
http://priceonomics.com/why-dont-restaurants-charge-for-reservations/

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ghshephard
What I've never understood is the opposite, is those restaurants which have
_insane_ lines, as in 2+ hours waiting outside to get a seat, why they don't
simply raise their prices by $1 or $2.

There was a restaurant that everyone in college in Vancouver went to back in
1993-1994, Antons Pasta, and you always had to wait incredibly long for - the
place was packed 100% of the time at night.

I would see this line (fresh from my economics class), and wonder, instead of
charging $5 for the tortellini, and have a 3 hour line, why don't they charge
$5.50, or heck, even $6.00, and only have a 1 hour line. It's not as though
having a 1 hour line is going to result in any lost business.

I'm thinking that part of this is the fact that a long line outside, means
there will always be business _inside_ , and there is always some paranoia in
a restaurant of having empty seats inside, and better to have slightly missed
profit opportunity, than to have some seats go empty and make a "reasonable"
profit.

That's the only theory I could come up with.

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untog
There's also the fact that not all restauranteurs are thirsty entrepreneurs.
Honestly, if you were, you likely wouldn't get into the restaurant business as
it's hardly a great market - most restaurants end up closed and in financial
ruin.

Many restaurant owners (and I know a couple) are quite happy to earn enough to
live comfortably, and to be - for want of a better term - a cultural hotspot.
I bet the owner of Anton's Pasta loves that his restaurant is that popular.

~~~
ams6110
_most restaurants end up closed and in financial ruin_

Isn't this also the case for most tech startups?

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untog
Sure. I'd wager (anecdotally) that there are more big successes in the startup
world, though. Even the most phenomenally successful restaurants don't go on
to have IPOs unless they become massive national chains. And you can transfer
your startup experience to a high paying job at Google, Facebook, etc. - being
a failed restauranteur doesn't have the same marketability.

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smokey_the_bear
Chez Panisse charges a $25 deposit for reservations, that goes towards your
meal. But they have two seatings per night, so it is more difficult to fill
tables for no-shows. It's still impossible to get reservations there.

~~~
ghshephard
That's a good system - presumably if you cancel your reservation, you get back
your deposit, and it allows the people on the waiting list a chance at the
seat.

~~~
icebraining
_presumably if you cancel your reservation, you get back your deposit_

Yes, as long as you cancel more than 48 hours before the reservation.

~~~
frandroid
Otherwise, what would be the point...

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mbollier
I imagine at some point we will see this happen, as society stratifies even
further. You can already pay to skip lines at places like Disney.

~~~
afafsd
(a) Society is currently less stratified than pretty much any point in
recorded history, so if you don't like stratification then don't complain.

(b) On the other hand, popular and in-demand restaurants already have schemes
for letting rich and/or important people get reservations ahead of the plebs.
When I went to French Laundry (after a six-month odyssey to get a reservation)
the waiter mentioned that only about half their tables are actually open for
reservation by the ordinary scheme, the others are reserved for booking by
other means. If you're a rich dude who likes to bring clients there and always
buys the expensive wine, you'd better believe that they're gonna give you the
number for their secret reservation hotline.

~~~
bulletsvshumans
> (a) Society is currently less stratified than pretty much any point in
> recorded history, so if you don't like stratification then don't complain.

In terms of the share of U.S. income going to the top 10% or 1%, the data
would seem to imply that the U.S. is currently the most stratified it's been
in over 80 years [1].

[1] [http://economix.blogs.nytimes.com/2013/09/10/the-rich-get-
ri...](http://economix.blogs.nytimes.com/2013/09/10/the-rich-get-richer-
through-the-recovery/)

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jzwinck
I've encountered another approach in NYC which I haven't seen mentioned here.
Some higher-end restaurants require a credit card number (over the phone,
maybe online is possible too) which they tell you they will charge e.g. $25
per person for no-shows. The first time I was a bit put-off (giving out CC
numbers on the phone never feels great), but now I'm more sanguine about it.

Aside: in central London, booking is essential. Many decent (not even high-
end) restaurants have most of their tables booked in advance. I did a double-
take the first time I walked into a place with two-thirds of its tables empty
and was turned away. "Fully booked" seems a lot more common there. I never
knew a restaurant to charge for booking, but I did know people who paid
"unofficially" to get tables, or had office assistants scramble for them.

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ylem
It's interesting, I remember listening to NPR awhile back and they had a story
about how high end restaurants are experimenting with a "ticket" system for
reservations. Part of the problem is that even for restaurants where say you
reserve well in advance for a holiday, it's surprisingly common for people to
cancel at the last minute. So, some have tried to have people prepay for the
meal. It might only work for rather pricey restaurants though...Here's the
link: [http://www.npr.org/blogs/thesalt/2014/08/05/337834577/no-
mor...](http://www.npr.org/blogs/thesalt/2014/08/05/337834577/no-more-
reservations-exclusive-restaurants-require-tickets-instead)

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arjie
There are some places that are remarkably successful and ticket for tables:
[http://website.alinearestaurant.com/site/2014/06/tickets-
for...](http://website.alinearestaurant.com/site/2014/06/tickets-for-
restaurants/)

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raverbashing
There are a lot of good options that don't involve staying in a line or
rushing to make a reservation.

I've heard about restaurants wanting charge for reservations by "prepayment of
the meal", and it's somewhere I wouldn't go to.

"Alicia’s reluctance to user her and her restaurant’s name suggests one
reason: customers are very sensitive not only to prices but to the perception
of a rip-off."

Exactly

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axilmar
My opinion is that having a long queue, possibly longer than any of the
competitors' queues is more important for the owners than a few more bucks,
especially in the long run.

Amongst their peers, chefs are more interested about their fame than their
pockets.

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cphoover
Would you go to a restaurant that charged for reservations?

Personally, I would not... I imagine that is why.

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mbollier
If I wanted to eat at a highly-acclaimed restaurant and was given the option
of either waiting three months or paying some fee of $X to guarantee a
reservation tonight, then there are some non-zero values of X in which I would
gladly pay.

~~~
SocksCanClose
do you have a few minutes to chat over the next few days? would love to talk
to you about this comment. working on a solution that would allow you to do
just that -- with a twist. you can email me at josh at mptonight dot com.

~~~
hcho
If you want to do this for customer validation, don't bother, the market for
this already exists. Sometime ago, there was a post here about a startup
making a killing selling software which sells reservations for restaurants and
bars.

If you believe you can execute it, go for it.

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ArkyBeagle
I think it's because there's a general cost in uncertainty for table
occupancy. A reservation makes that go away.

If you have a restaurant that will always have a permanent line waiting on
tables, then maybe you could charge. But it would be easier to hide that cost
in the bill.

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patio11
San Francisco, where allocating resources by paying for them is vulgar. You
should instead come by them honestly, such as by telling the concierge at the
Four Seasons that you wish to partake in the cultural delights of the city.

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Joeri
Why do restaurants take reservations at all?

Reservations force tables to remain unoccupied, and even when they're
occupied, diners feel no need to rush to make room for the next set of diners
since they reserved their time slot. A restaurant that's not popular enough to
fill up completely doesn't need reservations, and one popular enough that they
have to turn away people is losing money accepting reservations. So, why do so
many restaurants do it?

~~~
ObviousScience
Because customers are willing to pay higher food prices in exchange for
reliably being able to arrive at the establishment at a particular time and be
seated.

I've been to restaurants that don't take reservations, and instead take a
wait-list. It took something like 3 hours of waiting to get a table.

I could never go there for a client or investor dinner, because the
unreliability of the table timing means I can't schedule it in. Considering a
meeting like that is worth tends of thousands of dollars and requires that
people with busy schedules all be around at the same time, I don't mind the
extra $50-100 a person meals at those places tend to run.

tl;dr: They do charge a reservation premium, it just gets mixed in to the food
expense rather than being a separate item. Additionally, people scheduling
tend to bring large parties or are there for special events, which tend to
spend more money.

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judk
He same reason most economically obvious things don't happen in practice:
transaction costs. But with mobile electronic payments, this is changing
across the economy.

