Delivering Dinner-And Keeping The Profit
Inc.|June 2018

Recently, Inc.’s legendary Norm Brodsky visited Michelle Gauthier and Justin Schwartz, founders of the thriving New York City–based fast-casual chain Mulberry & Vine. Mulberry & Vine has carved out a niche in a hotly competitive market with its healthy fare—but like many city-based restaurants, it faces challenges with rising costs and the advent of delivery services like Grubhub. Luckily, Norm was there to lend an ear—and weigh in.

Delivering Dinner-And Keeping The Profit

NORM: So, in the restaurant business, it boils down to percentages. What is your rent as a percentage of your total costs?

Michelle: It’s less than 10 percent at all of our locations.

Perfect. Ten percent is the magic number. What about food costs?

M: About 27 percent. With packaging, though, we’re probably at 30, 31.

OK. That’s an acceptable rate.

M: Other costs are the problem. Delivery, which is 30 percent of our business, has really taken a chunk of the profits.

We have that problem at our restaurants too. Everybody does. It’s expensive. I see you use multiple delivery services.

M: We outsource it. But we are very close to doing it ourselves, because it’s super expensive. With those services, we’re giving away close to 35 percent of revenue on deliveries.

This story is from the June 2018 edition of Inc..

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