Felix Salmon

Restaurant charts of the day, price/quality edition

By Felix Salmon
May 2, 2013


San Pellegrino has released its annual list of the 50 best restaurants in the world, and of course Quartz is on it. “Ultimately,” writes Adam Pasick, “the world’s best restaurants cater to a global elite who can afford to spend thousands of dollars for a meal”. It turn, that means Quartz, a publication devoted (in both senses of the word) to the global elite, needs to be all over it, with an analysis of how fast-growing countries are over-represented among the restaurants “making big leaps up the rankings”.

But Pasick well knows — because he commissioned this article from me when he was at NYMag — that the elite level of gastro-porn restaurants are not actually targeted at the kind of tourists “that can take a Gulfstream to dinner,” as he puts it. Yes, the San Pellegrino restaurants are expensive. But they’re not international plutocrat, private-jet expensive; anybody in the “mass affluent” can afford to go to any of them, as a special occasion. And indeed unless you happen to live in the same city as one of these restaurants, it’s going to cost you more to get there than it is to eat there.

The chart above, diligently put together by Ben Walsh, shows the top 50 restaurants, in order, with the prices on their websites. (The short green stubs are the restaurants who either don’t put their prices on their website, or who make them so ridiculously hard to find that we ultimately just gave up.) These restaurants like to deal in prix-fixe set menus, which is convenient: the menu prices range from 1800 Thai baht, or $61, at Nahm, to £195, or $304, at the Fat Duck.

Interestingly, it’s hard to tell whether restaurants in fast-growing emerging countries are generally cheaper or more expensive than the ones in developed nations: all of the restaurants in Brazil, Peru, Mexico, Singapore, and mainland China, for instance, have those green bars and are very opaque on pricing. But what we can tell is that there’s no relationship at all between price and quality.

Here’s the scatter chart: there’s no correlation here, but maybe you can see a bit of a clustering around the $200 level.


And to underline just how random these things are, here’s the same chart only this time using the price rank rather than the absolute price.


What we’re emphatically not seeing here is any kind of massive price spike among the top 0.01% of restaurants, which you might expect if those restaurants were in fact patronized by the richest 0.01% of people. What we are seeing is a group of expensive restaurants, charging expensive-restaurant prices, but whose position on this list is entirely unrelated to the amount that they charge.

I’m sure there are restaurants in the world — including high-end sushi places — which are more expensive than any of the restaurants on this list. More to the point, I’d expect that all the restaurants on this list offer many bottles of wine whose price is many multiples of their most expensive set menu. With wine, the sky’s the limit when it comes to price; with food, there really does seem to be a limit, somewhere around the $300 per person level. That’s not cheap, by any means. But it’s not the kind of price which is only affordable if you have a private jet and live in a $20 million home. The world of restaurants, it turns out, is positively democratic, at least compared to areas like wine or property. Or even, for that matter, high-end handbags.

7 comments so far | RSS Comments RSS

It’s not hard to explain rationally.

Start with the 0.01% figure. In the U.S., richest 0.01% comprise 30,000 people. Most of these are married and have private chefs. Let’s assume that an average of these 30,000 eats a dinner in a restaurant once every 10 days. Let’s further assume (this is an oversimplification, but it should do) that they are equally distributed in the U.S., each of them knows 5 best restaurants within a 20 mile radius from his/her home or work, and he/she visits those 5 equally often. (It would be too boring to go to the same place every time, and there’s hardly much difference between #1 and #3 in each city.)

There are 59 metro areas in the U.S. with populations of 1 million or more, and, assuming average population density of 2000 people per square mile, they cover 110,000 square miles. 110,000/(pi*20*20) gives us 450 “top-level” restaurants in the country, providing 3,000 meals to super-rich per day – or 6.7 super-rich clients per restaurant.

This is obviously well below capacity for a typical restaurant. One could try to run a restaurant that is specifically designed to serve 6.7 extremely overpriced dinners per day, but it’s not traditional and very risky. Instead the restaurant would target somewhere in the vicinity of 100 dinners/day, lowering the entry price accordingly, and try to collect the premium from super-rich visitors in the form of markups on wine or in some other way.

Notice that only 6 out of these 450 restaurants appear on the “world’s best 50″ list. 4 are in New York, 1 is in Chicago, and one is in Napa Valley, 60 miles from San Francisco. In essence, even when American super-rich eat in restaurants, they almost always do that in restaurants which are _not_ on the list.

This model can be improved if we recognize that neither the super-rich nor high end restaurants are distributed equally throughout U.S. metro areas, but basic findings should not be very different.

With the pool of 450 top class restaurants serving 100 dinners per day and the target audience visiting restaurants once every 10 days, we arrive at the figure of 450,000 patrons (0.15% of the population). 99.85th percentile by income in the U.S. is around 20 times the median household income. If it costs $10 for an average American to eat in an average chain cafe (the level of Denny’s & such), a dinner at one of the top 450 would cost $200.

Posted by Nameless | Report as abusive

“Ultimately, the world’s best restaurants cater to a global elite who can afford to spend thousands of dollars for a meal”

I’m sorry, that’s nonsense. The vast majority of diners at those places are not billionaires. I’m not even a millionaire, and I’ve been to more than one of the world 50, including El Celler.
http://www.flickr.com/photos/aurosharman  /sets/72157628958290937/

Posted by Auros | Report as abusive

Nameless, even your figure of 0.15% is way too small. I’d expect that most diners at high-end places (to name favorites in my own region — Ubuntu Napa, Benu, Gary Danko, Chez TJ, Manresa) are, like me, mass-affluent, maybe the whole top quintile; it’s just that we’re the people within that group are devoted to cuisine as hobby / art-form / entertainment. Eating at a top-notch restaurant every couple months will cost you significantly less than, say, blowing money on hobbyist-level investing (especially if you’re dumb enough to subscribe to the affinity-scam newsletters and magazines).

Posted by Auros | Report as abusive

The bigger issue is that higher price does not necessarily equate to better tasting food. There’s a limit to how good you can make food taste, but there’s no limit to how much you can charge pricewise.

In terms of value for money, cheap street food beats high-priced “cuisine” any day of the week and twice on Sunday. Pretty much anywhere in the world these days you can find food that tastes just as good if not better than what these highly ranked restaurants serve at a tenth of the price (if that)…

Posted by mfw13 | Report as abusive

Interesting article and so much more readable if the column chat had been a bar chart, given our predisposition to reading left to right instead of bottom to top.

Posted by Skrodolies | Report as abusive

I have found extremely diminishing returns on food quality after about $25/30 a plate.

Heck 80% of the time you can find something for $10-15 that is perfect. We live in an amazing time.

Posted by QCIC | Report as abusive

“In terms of value for money, cheap street food beats high-priced “cuisine” any day of the week and twice on Sunday.”

It entirely depends on what you want.

I agree that there is some amazing street food. I patronize food trucks for lunch quite frequently. OTOH, sometimes they’ve been disappointing (and once I got some kind of food poisoning — the hygiene standards at high end places are, I suspect, better than that, or at least they’ve never burned me).

What you will _never_ get from street food is the artistry and innovation you find in high end places. High-end places are making much more deliberate choices about how to tweak every aspect of the food — how it interacts with at least four senses (visual, smell, taste, touch), and sometimes even all five, if you look at something like, say, Elizabeth Falkner’s signature Explosive Caesar Salad (which includes parmesan “pop rocks” that sizzle on your tongue). There’s also an element of stage-craft or performance art in the way the food is presented.

If you’re not into it, fine, don’t go — there’ll be more seats available and lower prices for those of us who want to. But saying that street food is a “better value” _universally_ is like saying, “God, how stupid are those people paying to see the Metropolitan Opera, when they could find people busking on the street, who would be happy to get paid a dollar.” Some of us _like_ opera, and choose to devote some of our resources to experiencing it as performed at the very peak of human ability (in terms of the singing, stagecraft, etc). Others of us _like_ cuisine, and want to experience the edges of what’s possible with that artform. And apparently the market of people who truly love that artform will easily bear a price somewhere in the $150/plate range.

I will say that there definitely are some very expensive places that are expensive purely because of the crowd they cater to, or because they’re coasting on reputation / tradition — places that the bigwigs of some local industry (bankers, lawyers, politicians, actors) have been patronizing for ages. Nobody who doesn’t care about being a member of the tribe should ever bother going.

But I definitely disagree with the idea that there’s no improvement in quality above $30/plate. I’ve been to plenty of places that _entirely_ justified much higher prices than that.

Posted by Auros | Report as abusive

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