foodienomics

Danny Meyer’s Cost-Cutting Measures

Danny Meyer’s Cost-Cutting Measures

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With the restaurant economy looking bleaker than the end of daylight savings, we called on Danny Meyer the other day to see how he's holding up. The answer is: cautiously optimistic. For one thing, he's looking to hire: The economic crisis, he says, makes Shake Shack and Blue Smoke more popular to former big spenders and makes people who would otherwise look for entry-level jobs in, say, publishing more amenable to waiting tables. He's iced a deal with OpenTable to host a nationwide Restaurant Week just before Thanksgiving, in hopes of luring people back to the reservation book. "People don't need the $80 bottle of wine, they just need to be with other people," he reasons. And he's filled out the roster for his Citi Field pavilion, naming the taqueria El Verano ("the summer"), and smartly swapping the name of the Belgian-fry stand from Pop Fries to Box Frites.

But even the man behind the Shack Burger feels the chill. Business is down at Tabla and Eleven Madison Park, but location has something to do with that: These are the lobby restaurants for Credit Suisse First Boston's HQ, where execs who still have jobs don't want to look profligate by dining out. ("We call that the AIG factor," he said.) And gains at the Modern can be sourced to strong tourism and a weak dollar, but in the winter months these factors aren't sustainable. So what's a restaurant mogul to do? For starters, streamline your supply line. "We've always been very careful to let each chef buy whatever they want from whomever they want," says Meyer. "But we really have started to coordinate who's buying what." When the man who refers to his trade as "a heart and mind massage" starts talking about wrangling volume discounts, you know we're through the economic looking glass.

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