I mentioned in one of my previous posts that restaurant portion sizes were much larger now than in the past.  It is interesting to note that a single 2oz. hamburger, a small fries, and a small soda was, at one time, considered a standard meal.  Now many Americans feel unsatisfied by anything less than a Quarter-Pounder, large fries, and a 32oz. soda.  How did we get here?

While some people might ascribe this to sinister motives (“It’s a cookbook!”), I think that it’s really the result of some basic economic influences.  After all, Americans have always had a large appetite- Alexis De Tocqueville and Charles Dickens both commented on the enormous quantities of food eaten by Americans in the mid-1800s.  To some degree this shrank in the early 20th Century, perhaps as the result of two world wars and the Great Depression.  By the 1950s, portion sizes were much smaller than today.

That seems to have started to change again sometime in the 1970s or 1980s.  During the era known for “stagflation”, fast food restaurants launched numerous larger dishes.  Many people remember Wendy’s running ads that asked, “Where’s the Beef?”.   The concept of a “value menu” that sold cheap eats also arises during this time.

This is also the era when buffet restaurants exploded in number.  By 1990, buffets were popping up even in the fast food franchises.  Both Wendy’s and Kentucky Fried Chicken outfitted many of their restaurants with them.  People were apparently desperate for lots of food cheap.

This is the simple explanation:  People were feeling poor, so they wanted to feel full for not a lot of money.

It’s also a little too simple.

The fact is that food is cheap in America.  Even if we strip away the countless government subsidies, we can produce more food with less human labor than any nation in the history of the world.  As a whole, we spend a lower portion of our income (<10%) on food than most of the rest of the world.  The Chinese, for instance, spend about 35% of their income on food.

Given that said 10% (or less) of our income is also buying way more food than the average Chinese person is eating, we could probably get away with spending more like 5% of our income on food.  If we are living in such ridiculous abundance, why are our restaurants inundating us with ginormous portion sizes?

Overhead costs.

Operating a restaurant is a very expensive endeavor.  The food that actually goes on your plate is a minor part of the total costs that the restaurant has to cover.  Considering that commercial rents in many areas cost several dollars per square foot (per month!), the little spot you’re sitting in might cost the restaurant a hundred bucks a month in rent.  Add to that the costs of heating and cooling, running the equipment in the kitchen, buying insurance, and so on- you’re starting to talk about real money.

Let’s say that our example restaurant is open twelve hours a day (10am to 10pm), seven days a week (336 hours a month) and seats 50 people at a time.  The restaurant has to divide the cost of keeping the lights on (say $5,000 a month) by the number of seat-hours (16,800) to cover their physical overhead.  This works out to about 30¢ per seat per hour.  Since many diners will be there for about an hour, this translates to 30¢ per diner.

Of course, during many of those hours, the restaurant may be nearly empty.  Out of twelve hours, perhaps only four (11:30 to 1:30 and 5:30 to 7:30) will see every seat filled.  As a result, the restaurant multiplies the overhead by three (90¢) and probably rounds up to a buck to give a margin of safety.

Now we need to calculate in the cost of paying people to prepare your food, to serve it, to clean up afterward…  If you assume that one cook can cook twenty meals an hour (that’s a guess, but it should work for illustrative purposes), then the restaurant has to recoup about $1 per meal to pay for that cook.  He or she probably doesn’t earn $20 an hour, but with all the costs employers pay on top of salary (unemployment insurance, Social Security payments, etc.) that’s not an unreasonable estimate for line cook at a mid-level restaurant.

Even though waitstaff are often paid less than minimum wage (plus tips), they and the clean up crew probably add another dollar per meal to the overhead.  This doesn’t even take into account things like the cost of replacing broken dishes, consumables like straws and napkins, and other “free” things like sugar, salt, pepper, and other condiments- which can easily cost another dollar per diner (the last time I ordered ketchup packets for work, they cost about 20¢ apiece).

That means that for every diner, the restaurant needs to bring in about four dollars of income- before the cost of the food!

Think about that for a second.  If you go into a restaurant and order a bowl of oatmeal- which probably costs about 25¢ in actual food costs, the restaurant has to charge you about $4.25 to break even.  Figuring that you might only be there for half an hour, and that you’ll probably buy coffee too, they might drop that down to $3.25 or even $2.50.

Of course, you know, on some level, that coffee and oatmeal are cheap (like dirt cheap), so part of you wants to feel justified in spending five bucks on a breakfast of coffee and oatmeal.  It’s reasonable to want to feel like you’re paying a fair price, right?

Extend that example to a plate of meatloaf and mashed potatoes.  The actual cost of a small serving of meatloaf and potatoes might only be $2.00 wholesale.  Add to that the $4.00 in overhead costs and you get a cost of $6.00.  To make any money, the restaurant has to charge you more than that, so they slap a price of $7.99 on the meatloaf meal.

Holy cow! Eight bucks for a little slice of meatloaf and some mashers?  I can buy the same size meal as a TV dinner for three bucks!

The restaurant now needs to leverage their perceived value.  They can add a third slice of meatloaf and double the potatoes for another dollar in food costs.  Now, the meal in question seems much larger than the TV dinner.  It’s harder to compare the two and the new restaurant meal seems much more reasonably priced- after all, it’s so big you can get two meals out of it.

Of course, the restaurant makes less money on the new meal because their profit margin went from $1.99 to $0.99.  So, they look for other ways to increase the perceived value of the meal at a lower food cost- perhaps some bread or a small cup of vegetables.  They might only cost 50¢, but now the meal costs you $9.99.  The restaurant’s profit margin is now a healthy $2.49.

Obviously, this is a gross exaggeration and I’m sure that a real restaurant owner can provide much more concrete numbers.  Don’t get stuck on the numbers.

The point is that increasing overhead costs have encouraged restaurants to increase portion sizes to justify the increasing cost of the meals.  It is our job to recognize this and to either order smaller portions (even if we pay the same price) or to do as people used to do…

…and get a doggie bag.