🎧 Listen: In today's episode of The Journal podcast, a New York City restaurateur explains why she decided to dramatically overhaul her business to raise wages—and how that's helped her retain staff and increase profits
This transcript was prepared by a transcription service. This version may not be in its final form and may be updated.Speaker 2: The ongoing worker shortage has taken a toll on restaurants and now even popular coffee shops.
Amanda Cohen: No, although that would be a pretty good feat if I was doing that. We're a vegetable restaurant. And so when we were looking for a name, I really wanted something that would stand out. And at the time this was 13 years ago, every restaurant sort of had this one word name. It was like fork, spoon, table. And we were talking about what vegetables meant and I was like they are like candy from the earth and candy from the dirt, and then all of a sudden it was Dirt Candy.
Ryan Knutson: Amanda says turnover was high not just because wages were low, but also because wages were so unevenly distributed. Waiters could make a lot more in a night than a line cook, for example. And the reason for that is tipping. Ryan Knutson: Mm-hmm . And so when the pandemic hit and the lockdowns began in March of 2020, what were you thinking when that all started?
Ryan Knutson: Amanda says that reducing Dirt Candy to a single menu cut down on her food costs a lot. Before, food accounted for roughly 27% of our operating expenses. Now it's closer to 20%. and she didn't stop there. Amanda also raised the price of the tasting menu from $65 to $85. And she started to realize that now the whole business model for Dirt Candy looked different. She boosted wages even further to $25 an hour and could even afford to give her employees health insurance.
Ryan Knutson: Were you nervous though to raise your prices and limit your menu? Were you nervous that customers wouldn't respond well? Ryan Knutson: And has raising your wages to $25 an hour created in a new challenges or new problems for you?
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