Diners are staying home, so this restaurant lets patrons pay what they want

Robin Wiley (left) and Armand Daniels heard about the pay-what-you-will promotion on social media. Sergio Flores for NPR

Sergio Flores for NPR

"We didn't have a really great Valentine's Day," Daniels said. "It was OK, but nothing out of the ordinary, nothing spectacular, so this is our Valentine's date."

The couple ate a spinach salad with pickled pineapple oranges and candied almonds — "It was awesome," Wiley said — and ordered more. Daniels said they would make a decision about what to pay when they saw the final bill, but were considering paying less than full price.

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"Things are a little bit tight," said Daniels, who works as an actor and brand ambassador. "Jobs are harder and harder to find."

L'Oca d'Oro, an Italian restaurant and bar in Austin's Mueller neighborhood, introduced the pay-what-you-will night in December. In the fall, co-owners Adam Orman and Fiore Tedesco III were grappling with the effects of disruptive tariffs, rising food costs and a labor shortage — as well as their own increasing menu prices.

Fiore Tedesco III (left) and Adam Orman are co-owners of L'Oca d'Oro. Sergio Flores for NPR

Sergio Flores for NPR

Orman said the partners wanted to find a way to respond to the dwindling number of people able to afford dining out at restaurants.

"Getting drive-thru is not going out. Sitting down, being treated with hospitality, being a guest is a thing that everybody should be experiencing regularly, because it feels good," he said. "This is a way of making sure that that is accessible for everyone."

Tuesday-night diners at L'Oca d'Oro still pay full price for drinks, but they can order whatever they like off the regular food menu and choose how much to pay for it. Patrons are assessed a 20% service charge on their chosen total. (The restaurant charges the 20% pre-tax fee to all patrons to help fund the living wages, benefits and paid time off of staff members, Orman said.)

The partners understand that offering their products and services for free may not seem like a savvy business strategy. But Tedesco, who attributed the restaurant's drop in volume over the past two years to political and financial instability, said he prefers pushing back on that conventional wisdom.

"There's a way in which it seems like we should raise prices right now because everything's more expensive, [that] we should lean that way," Tedesco said.

Tedesco chops rosemary in the kitchen. He hopes the pay-what-you-will promotion can be a way to meet the current affordability and social challenges facing Americans. Sergio Flores for NPR

Sergio Flores for NPR

"I feel really confident and I feel lighter and more loving and more full and more generous in practicing the spirit of leaning that other way," he said, "of saying, no, the lesson here is this is for everybody. This really is a time to be less inhibited about going out."

Restaurant food, hold the restaurant

Americans are increasingly passing up on dining out. A YouGov report from October found that 37% of U.S. diners said they were dining out less often than they had a year earlier, while only 8% said they were going out more.

Rising menu prices and a desire to save money were the top reasons why people were staying home, the research group reported.

When they do dine out, most customers are getting their food to-go. According to data released by the National Restaurant Association last year, nearly three out of every four meals served by U.S. restaurants were takeout orders.

Restaurants of course depend on customers for business, but diners also rely on restaurants for the social stimulation and respite from domestic life they provide, says Princeton University anthropology professor Hanna Garth, who has conducted research on food access in Los Angeles.

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Two guests sit at a table at L'Oca d'Oro. More than a third of Americans are dining out less often than they did last year, according to report from YouGov. Sergio Flores for NPR

Sergio Flores for NPR

"For a lot of people, it's just about breaking from the routine and the monotony of eating at home. For a lot of women, it's about alleviating the burden of the work of cooking a meal and cleaning up after the meal," she said of the L.A. residents she's spoken to. "And I think for a lot of people it's also a social activity."

Restaurants are also what's known as a "third space," an area outside of our home or workplace where we interact with others. When restaurants become inaccessible, those incidental social exchanges they offer also disappear, Garth said. Think chatting with the hostess and wait staff, or asking the people at the next table how their food was.

"Those connections, even though they're teeny-tiny connections that seem like they don't matter that much, they're a really really big deal for making us feel like we belong to a community and we're connected with others around us," Garth said.

Orman and Tedesco said they hope L'Oca d'Oro's pay-what-you-will promotion — a concept that's been around for a while in the food service world — can be used now to meet the current affordability and social challenges facing Americans.

'It just doesn't feel like it should be possible'

Erin Weber and Michelle Valencia were at L'Oca d'Oro for a "girls night," Valencia said. She works for the city's public health department, and Weber is an editor who also attends graduate school for clinical social work.

Michelle Valencia (left) and Erin Weber visited the restaurant for a "girls night." Sergio Flores for NPR

Sergio Flores for NPR

They had been to the restaurant once before, Valencia said, "but when we saw this we were like, 'oh that's a really cool special.'"

Weber, a native Austinite who said she's enjoyed watching the city's food scene evolve, praised the restaurant's pay-what-you-will experiment. "This is a really great way for people from … all walks of life to just be able to enjoy amazing food," she said.

When their bill came around 8 p.m., Weber and Valencia decided to pay $100 on their $117 tab, splitting it down the middle. "I guess we're seeing it as like our happy hour total," Weber said, "you know, a little bit of a discount."

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That night, the restaurant made $70 less than what it would have had it charged full price for food, Orman said later. He estimates that most Tuesday diners typically pay about two-thirds of their actual food bill, while only a couple of customers pay far less and many people fork over around what they owe.

Chris Ortiz and Rickyann Ramos, who were celebrating two years of marriage, said they intended to cover their whole bill. "I think we would just fully take care of it from our end," Ortiz said, "because we're in a position to do so and hopefully that can help others out."

According to Orman, the restaurant typically ends pay-what-you-will nights earning less than the full menu price of the food they served, but once they made $12 more. He said the partners are happy with the math, and the normally slower weekday is seeing an average increase in traffic and revenue since the promotion began. The restaurant is even considering expanding the pay-what-you-will concept over the summer as they introduce new menu items.

Since the pay-what-you-will promotion began, the normally slower weekday is seeing an average increase in traffic at the restaurant. Sergio Flores for NPR

Sergio Flores for NPR

As his table prepared to order, Zayed Al-Hamad marveled at the deal they were getting.

"I'll be honest, there's a level of guilt, you know? I go to order, and I have to fight through this feeling of, like, 'am I allowed to do this?'" he said. "I'm not going to write $10 down, but man it just doesn't feel like it should be possible."

Al-Hamad, who works as a menu planner connecting businesses with caterers, said he uses rental assistance to afford his apartment in the building adjacent to the restaurant. Tonight at L'Oca d'Oro he'll pay what he can, but as Al-Hamad gets on better financial footing in the future, he hopes to chip in even more at places like this.

"As I continue to get to live in this city, I hope I'm able to support these businesses more and more, and hopefully I can be part of the reason why they're actually able to afford to do these things," he said.

Zayed Al-Hamad was excited to have an affordable and nice restaurant to take his family out to dinner. Sergio Flores for NPR

Sergio Flores for NPR