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Maximizing revenues – How restaurants are learning tricks from the box office | Miami Herald

If your business has fixed capacity, if it’s perishable, meaning that if it doesn’t sell by a certain date it’s gone forever, and if different people are willing to pay different amounts for it, you’re a prime candidate for a powerful pricing practice known as Yield Management.

We’ve all been “yield managed.” It’s the reason we pay more for airfare during Thanksgiving and Christmas. It’s the reason we pay more to sit in the front row instead of the mezzanine. And it’s the reason we’ll pay a ticket scalper to get into a Bruce Springsteen concert after the box office is sold out.

We’re used to this. It seems fair and just and part of the normal course of business. Right? Good. Because it looks as if restaurants are about to get into the yield management game as well.

So why not apply one of the most powerful pricing techniques available? One that allows the restaurant to charge more for meals during peak hours, while also lowering prices in order to fill off-peak hours as well?

The implications for restaurant profitability are incredible. But will diners accept the new approach? No one knows for sure, but it looks like a good bet to me. It’s already nearly impossible to make reservations at the best restaurants. At others, people wait hours for a table.

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Maximizing revenues – How restaurants are learning tricks from the box office.

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