News for hackers. Stuff that matters.

A comment on The state of the restaurant industry. Parent comment

Re:The state of the restaurant industry by imtringued on Wednesday March 18, 2020 @09:51AM (#22616623)
That's not how margins work. God didn't descend down to earth and declared all restaurants to be low margin. Margin is a matter of competition. If there is lots of competition then the margin will shrink to barely cover costs of running the business. If suddenly every restaurant has a problem finding customers and a load of debt then restaurants are forced to increase their margins to cover their debt payments.

Low margins are the result of heavy competition. If there is less competition margins will be high again.

[ Parent | on HN ]
Re:The state of the restaurant industry by vkou on Wednesday March 18, 2020 @04:18PM (#22620817)
1. I didn't say one word about margins in my post.

2. The problem is that after the pandemic ends, the margins will remain low. Because new entrants, with no outstanding debts or obligation will eat the lunch of any of the restaurants that remained 'open' during the pandemic.

[ Parent | on HN ]