Chefs Expose the Hidden Costs Behind Restaurant Dishes
Two chefs have lifted the lid on the expensive business of creating menus they love, revealing that the price diners pay often leaves restaurants with razor-thin profits. Chantelle Nicholson, chef-patron at Apricity in London W1, and Sally Abé, chef and restaurateur at Teal in London E8, broke down the hidden costs behind two of their dishes, showing that ingredients account for only a fraction of the final price.
Asparagus Starter at Apricity: £21, Profit £1.65
Nicholson's asparagus, smoked emulsion, watercress, and sourdough starter costs diners £21, but the restaurant makes just £1.65 profit. “It’s easy to assume vegetable dishes should be cheaper than meat,” she said. “Vegetables usually are, but vegetable dishes are more labour-intensive. It’s simple to slap a steak on the grill, but you can’t just plate up a carrot.”
Asparagus can cost between £15 and £20 a kilo, up from £9/kg not long ago, mainly due to hand harvesting and rising labour costs. After cleaning and trimming, the stalks are blanched and cooled, then combined with a smoked emulsion made from aquafaba (leftover from pressure cooking chickpeas) and smoked rapeseed oil from Duchy farm. The cost of rapeseed oil has risen due to the war in Ukraine, but British-sourced oil has remained more stable.
“Overall, the ingredients for this dish are around £3, but the labour, energy and everything else comes to £56 – which, of course, we divide across the whole menu,” Nicholson explained. She highlighted hidden costs such as extraction chimney cleaning (£4,000 annually), fire alarm maintenance and testing (£8,000), and a pavement licence (£700 per year). “There are so many random costs that nobody sees,” she added.
The breakdown for the asparagus starter:
- Ingredients: £2.18
- VAT: £3.67
- Staff costs: £8.56
- Rent, rates and utilities: £2.41
- Running costs (accountancy, PR, pavement licence, waste collections, till system, website, linen, etc): £2.53
Beef Sirloin and Short Rib at Teal: £36, Profit 44p
Sally Abé's beef sirloin, short rib, and wild garlic main course costs £36, with a profit of just 44p. “I’ve been open only a few months, and I’m already seeing price increases,” she said. “Beef has gone up 2.5%, because of ever-rising feed and labour costs, and I have to pay VAT on top of that.”
The sirloin costs £6.50, plus £1.50 for the short rib, before other costs. The jus alone costs £1 per portion, made from three bottles of red wine and one bottle of port, plus veal and chicken stock, reduced over a whole day. “That takes a whole day of labour and energy,” Abé noted.
Abé expressed frustration that customers compare restaurant prices to supermarket food, which is much cheaper. “It feels as if hospitality businesses are not allowed to make money,” she said. “Nobody blinks at paying £500 for an iPhone, and Apple makes a significant profit on that. Yet, right now, restaurants are not even in a position to make 10% profit.”
The breakdown for the beef dish:
- Ingredients: £10
- VAT: £7.20
- Staff costs: £9.60
- Rent, rates and utilities: £5.76
- Running costs (accountancy, PR, pavement licence, bin collections, till system, website, linen): £3
Restaurants Struggle as Costs Double
Both chefs emphasized that many costs have doubled, and restaurants are being squeezed by rates hikes while unable to increase prices proportionally. “We’re only just washing our faces – yet we are the backbone of people going out, seeing friends and having fun,” Abé concluded.
