As you can tell from prior posts, I will be hosting a rehearsal dinner come October 2012. I started looking now. I have contacted and am gathering information from a number of places. All the places that have been recommended by SD have seemed excellent, and I am sure I will be contracting with one of them. However, I am astounded by the pricing. From my point of view, I am supplying the restaurant with a large and guaranteed sale on the day in question, but I am expected to pay as though they are doing me a favor. Some places want a room fee, up to $450. I don’t rent a table at a restaurant. Food pricing seems about the same as direct from the menu, although it is bundled and therefore guarantees everyone is purchasing appetizer, main course and desert, something that cannot possible happen 100% of the time. Drinks are charged at the usual restaurant rate, but I am also asked to pay a set up fee? A 20% gratuity is then added to everything, and while I have absolutely no problem tipping 20% for service this is going to be buffet style, and I am not going to be having the 10 or more waiters 50 people would garner at the restaurant. My guess is 3 or 4. And I always like to tip in actual cash, for obvious reasons.
So what is going on here? Is there a secret password that business people know and will instantly get the bill reduced by 25%? Is this what happens because business don’t worry about the costs as much because to them the expenses are tax deductible? Or has this culture of gouging just developed?
The OP already addressed your first point - he is paying a flat 20% gratuity fee (a more than adequate tip, I am led to believe). The pricing structure sure does sound strange, especially since apparently no one will be ordering from the menu the restaurant will know exactly what to prepare.
Nice venues cost money, even restaurants. To staff and to maintain. They charge an autograt because there are cheap jerks out there who decide because someone didn’t get their water, in a timely fashion, they don’t have to tip. They are just cheap assholes looking to pinch a penny, but they ruin it for other people unfortunately.
They do it for one simple reason, they’ve been burned before. If you don’t charge a fee, people book for 50, on a Friday night, the restaurant reserves the seating, and only 23 people show up! They probably turned away reservations to accommodate those 50 too!
They set the parameters, to insure they won’t get burned. Usually after having been burned by people who seemed perfectly normal and reasonable.
Elbows I am not complaining about tipping. I would prefer to tip cash. And I am not questioning a 20% tip. I am questioning that tip based on reduced wait staff. And what is up with the bar set up fee, and room rent? One thing that I did not make clear is that these are restaurants that also have private rooms. They are not places that only contract out. I am comparing what I am charged vs. calling up and asking for reservations for 50 at 8 pm. Same place, same food, but everything is more risky for them (as you pointed out) with the reservation for 50 vs. a signed contract. And yet the signed contract costs more for less. That is what I am questioning.
I honestly don’t know know, but have you called up one of the restaurants and asked them that exact question? If they can’t provide you with a satisfactory answer, go ahead and place your reservation for 50.
It seems counter-intuitive, but it is pretty much standard.
I just went through all this getting married in the summer, and none of what you describe appears out of the ordinary, to me.
You just have to accept that throwing a shindig such as this is dear. If absolutely anything at all is not to your liking, I urge you to raise the roof, however; exorbitant rates had better damned-well be justified with flawless product and service, IMO.
Restaurants usually want a minimum guarantee as well. If you order food for 50 and only 35 show up, they are entitled to be paid for 50, since they prepared food for that many.
These things are negotiable. Get estimates from more than one establishment if you can and compare. You can also make a counter offer and if your business is valuable enough to them, they might accept.
It’s possible the “setup fee” for drinks is an additional, private bar with bartender. That’s not unreasonable, and convenient to have.
One of the main issues driving these fees is the issue that you’re going to come in one big party and one big party is riskier than multiple smaller ones. Plus it sounds like you’re going to have your own room, set-up, buffet and bar.
With your own room, buffet and set-up the venue is not likely going to be able to turn the tables over for multiple seatings. If you have your own bar in the room that bar has to be stocked, opened and staffed at a noticeable fixed cost. If your group turns out to be filled with teetotalers alcohol transforms from a big profit centre to a loss, which likely means the venue will probably take a loss on your party.
The fees are the venue’s way of covering their ass, and so can be negotiated down/away if there is enough food and drink sold. Ask if the bar set-up fee can be waived if alcohol sales are at least $x, or the room fees reduce if you bring more guests.
This. I don’t negotiate food for the conference I’m involved in, but I see the prices. The best thing to do is to get a few quotes and try to negotiate away the set up fee.
Buffets are always going to have more waste than plated dinners. Is this a buffet affair or table service? If table service, you are using waiters just like in the normal restaurant. They may not be taking orders, but they also need to serve a whole bunch of meals at once. And they can’t upsell you. If you have an open bar, the bartender is likely to be idle a lot of the time not making money for the restaurant.
One of the biggest shocks I ever got in my life was the first time I saw the prices on a hotel catering menu. And it was for work - I wasn’t even paying for it.
I think the explanation for banquet pricing is that most people who order banquets either
Are spending someone else’s money.
Are organizing the banquet for something which they feel strongly about.
sometmes both, so they’re rather price-insensitive and banquet-offering places know it. I would price-compare and negotiate and consider reserving 50 places as JB said.
Also, if you’re worried about paying a lot, offering booze for free to 50 people might not be wise.
I don’t understand the people talking about risk to the restaurant. The OP says that they have a contract, right from the start: If he reserves for 50 and only 35 show up, the restaurant will still get paid for 50, because that’s in the contract. Having up-front commitments like that can’t increase the risk to the restaurant.
I tip in cash so that the waiter or waitress, who is working very hard for very little, can keep the entire amount if they so choose, rather than sharing with the government.
I really can’t see the increased risk either. It is clear that they can only use the space once per evening, vs perhaps three or four table turnovers. Perhaps this alone is the reason. It would be buffet, so we aren’t talking about lots of waiters. Also, while there may be more food waste I would think prep time and space would be even more expensive and that the overall cost would be less, even with more food left over. Certainly they can order the raw materials with much more precision. It always seemed to me that making a huge dish of something was only slightly harder than making it for two.
I am not certain about how the bar is set up, so I can’t make any comment on the bar setup charge. However, I do not see the large fixed cost. As far as I know an opened bottle of liquor is still perfectly usable.
And some of the charges are clearly negotiable. Due to an error, I got three different quotes to one place in 48 hours, with the room charge going from $200 to $300 to $450, for absolutely no reason at all.
And this is really more the principle than the money. I like to get good value for what I spend, and I do not think that this is a good value. I was really hoping that these charges were perfectly reasonable rather than added profit so that I could feel better about what I spend.
I’ve worked in hotel banquets. Staff is paid minimum wage plus gratuities. The grats for the entire week or pay period are added up and divvied up to each employee based on their role and seniority. Some workers get a bigger piece of the pie than others.
During this time of year, banquet workers can make up to $30 per hour. However, come January and February (and most of the year), hours and gratuities can be lean.
You’d be surprised how hard it can be to get paid, especially from social (ie not corporate) groups. Clients hate paying for guarantee numbers and many simply wont; and it’s simply not worth it to try and enforce most contracts through the courts. That’s the reason most venues require substantial deposits to hold the space and then full pre-payment before the function.
The other part of the risk is booze. Groups are surprisingly homogeneous in their drinking habits and alcohol sales are a very large part of restaurant profits. If I use the space for small groups the drunks and the teetotalers balance out to a fairly predictable number. With one large group (of unknown drinking habits) it’s quite possible that I’m going to have unusually high or low revenue for that week. It may work itself out in the long run but a lot of restaurants don’t want to risk the short term cashflow issues.
…whereas I always tip on credit card because I’m a government worker who works very hard for very little and doesn’t want people cheating on their taxes.
THe point about tables not turning over is kind of interesting. If you figure that a regular dinner party at a restaurant might last, what, 60-120 minutes, and then you compare that to the rehearsal dinner, how long do you figure your group will be there? Shindigs like this that I’ve been to tend to linger a lot longer than regular nights out at a restaurant, and that can mean lower profits for the restaurant.
Sure the booze is still good, but the labour has been pissed away.
I’ll give an example, at my current employer we had a large (300-400 guests range) dinner and reception. We had to assemble two bars, staff them, and disassemble the bars at the end of the function. The labour to do that doesn’t change much no matter how much or how little we sell. Total sales on the bars: less than $500. To avoid losing money in that kind of situation we charge the client for the bartender’s labour if sales are less that a certain amount, other venues will charge a bar setup fee.
Sure, some places try to squeeze as much profit as possible by inflating room or bar charges, but the idea behind them isn’t totally unreasonable.
One assumption I have been making here is that I will be occupying a separate room that would otherwise not be used. If I am displacing normally used tables then the room “rent” becomes reasonable, it gives them profit they will not make because my group would likely hang around at least twice as long as a regular diner.
