Why NYC's top restaurant raised prices during the recession

For America, the Great Recession began in 2007, officially ended in 2009, and is still the cause of a hangover for many.

But for New York’s top restaurant, Le Bernardin, the Great Recession meant a record year in 2007, with similar sales in 2008, with only an 8% decrease in revenue in 2009. The restaurant has experienced steady growth since then.

So how did a restaurant – where meals cost about four times the national average – manage to essentially avoid a recession that crippled the rest of the country?

They refused to fire people, raised prices, doubled their media budget and donated $100,000 to charity.

Chef Eric Ripert explained in an interview with Yahoo Finance. “What we thought was, we cannot let any employee go because they have been with us for long time, we have to support them.”

Le Bernardin has been named New York City's top restaurant by Zagat 13 times. This dish is Chef Eric Ripert's langoustine, a type of shellfish also known as Norwegian lobster.
Le Bernardin has been named New York City's top restaurant by Zagat 13 times. This dish is Chef Eric Ripert's langoustine, a type of shellfish also known as Norwegian lobster.

Chef Ripert’s staff is highly trained, from the wait staff to the kitchen. The restaurant has been named New York City’s number one restaurant by Zagat (GOOG) 13 times – receiving nearly perfect marks for service each time. “So we have to find a solution to make sure that we can keep everyone on board, and that the restaurant doesn’t suffer from that recession,” he said. “So one thing, which is paradoxical… We raised the price a little bit.” Specifically, the restaurant raised prices $5 per plate - not a huge jump when meals cost above $100.

Raising prices were probably a good decision, given the other steps Le Bernardin took. In 2009, the restaurant pledged $100,000 to charity – giving $1 for each patron who dined at the restaurant that year. The charity was City Harvest – which takes food that would go to waste and distributes it to shelters around New York. It’s a cause that is dear to Ripert, and many celebrity chefs.

On top of that, Le Bernardin saw how the press reacted to the news of their donation, and decided that they would benefit from being in the spotlight. So instead of cutting costs, the restaurant doubled its marketing budget overnight, working with two agencies to get the word out about Le Bernardin.

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That doestn’t mean that the restaurant ignored costs across the board. A Le Bernardin spokeswoman told Yahoo Finance that the restaurant renegotiated contracts that did not impact guest experience – lowering their costs for things like energy, gas and water. Because of that, she says Le Bernardin was able to generate “a good return in 2009.”

Since then, Ripert’s restaurant has grown steadily. They now employee 150 people, up from about 110 during ther recession. And the team behind Le Bernardin is expanding. Chef Ripert, owner Maguy Le Coze and sommelier Aldo Sohm recently opened the Aldo Sohm wine bar across the street from Le Bernardin – where people can eat small plates for a lower price.

The Le Bernardin commitment to charity has continued as well. Diners who wish to experience Chef Ripert’s renowned food but cannot afford the $135 per plate prix fix menu can eat in the restaurant’s bar area for $45 – cheaper than the average meal out in New York ($48.56). The $45 special is part of Ripert’s City Harvest menu – which is largely the same as the rest of the restaurant – but with $5 of the check going directly to the charity.

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