But is a tasty piece of avo toast really to blame for the fact that an entire generation may never own a home? (Um, no.) And how much are restaurants spending to make sure they’re getting enough revenue from these fancy, chili-flaked, garnish-adorned toasts?
“Let’s say this $10 avocado toast uses a whole avocado, organic of course—which now runs almost $3 each.”
Jessica Sackler, a partner at Mexican restaurant Calavera in Oakland and a graduate of Cornell University’s business and hospitality program, broke down the math for Eater. Turns out, there’s a reason you’re coughing up double-digits for a the nutrient-dense (yet yummy) snack—and it all comes down to making a profit in the (very tough) restaurant game.
According to Sackler, the cost of the food is just a fraction of what goes into pricing out, for example, an avocado dish on a restaurant menu. “Let’s say this $10 avocado toast uses a whole avocado, organic of course, which now runs almost $3 each,” she says. Add whole-grain bread, sesame seeds, and other garnishes, and you’re up to $3.50 for the ingredients—or about 35 percent of the menu price.
So where is the rest of that markup coming from? Sackler estimates that another 30 percent ($3) accounts for labor costs. Another 12 percent ($1.20) covers what the restaurant pays in rent and utilities, and 15 percent ($1.50) for “everything else,” which covers everything from printing for the menus to insurance, repairs, and the “other million things needed to run a restaurant,” Sackler says.
That leaves roughly 70 cents leftover from your $10 toast—not a very high profit margin for the restaurant which, she estimates, would have to sell nearly 11 million avocado toasts to break even on the $750,000 it costs (again, an estimate) to open a restaurant. Before taxes.
“The next time you complain that something is too expensive because you know that you can get an avocado at the store for $2.99, think about all the other things that go into it being served by healthy people, in a pleasant environment, in a convenient location,” Sackler says. And you gotta admit: It tastes better when someone else makes it, doesn’t it?
Another splurge in the “worth it?” category: this $20 smoothie that we tried in the Hamptons. Hey, you can make it up by following it up with these superfood-infused blends that average out to $2 each.