7 ms·

Looks like I'll end up having to pull brisket off the menu again this summer (I own & operate a BBQ food truck). Before this latest blow to the supply chain I

by tonyb 5y ago

Looks like I'll end up having to pull brisket off the menu again this summer (I own & operate a BBQ food truck). Before this latest blow to the supply chain I have already seen a 66% increase in brisket prices in the past 4 weeks ($2.99/lb about a month ago, current price is $4.99). The restaurant industry is already running on low margins so it will be interesting to see how this is all going to shake out.

asdff 5y ago
You could put brisket at market price like lobster roll food trucks tend to do. People still happily pay $18 for a lobster roll from a truck.
- tonyb 5y ago
  Raising prices is an option but that is very market dependant. BBQ customers in general are more price sensitive than lobster customers and I would lose sales at a higher price point. There is a certain price (which I have generally found is $4.50 - $4.99/lb, that is when my food cost for a brisket sandwich hits 50%. Target food cost should be somewhere around 30%) where it just isn't worth it to sell brisket. BBQ is somewhat unique in that you have to estimate your demand ahead of time - you can't just throw on another brisket if you run out and I don't reheat/re-use leftovers. So even if I raise my prices $2/sandwich to cover the increased cost my risk is still higher because any unsold product is now a higher loss.
  - koolba 5y ago
    Is it possible to purchase the cuts in advance and store them frozen or does that noticeably effect the quality? Seems straightforward to through some cuts in a deep freezer to smooth out supply costs. I do that on the small scale at home though obviously the capital costs would be proportionally larger at scale.
    - tonyb 5y ago
      That's exactly what I did starting about a month ago - I've got enough on hand to last about a month (most of that is committed to catering jobs that already have a set price - so my forecasting is much easier but if I didn't lock in the price I would have to eat the difference). As long as they are safely handled I've found no quality difference at all when freezing stuff that is cryo-vaced. More often than not it has already been frozen at least once before it gets to me. I don't ever sell anything that has been re-heated after cooking though. You can also do that with little to no quality loss but I try to position myself as a premium brand so everything is 'cooked to order'. There are also a lot more food safety concerns (cooing it fast enough, re-heating it fast enough, etc.) that I don't want to worry about. I vacuum seal cooked BBQ at home and it's just as good as fresh but you can't do that in a commercial setting without special permits that aren't available to food trucks (at least not in my area).
  - jasonwatkinspdx 5y ago
    I'm sure you know your business and market, but I'd just through out an example from my back yard. Matt's BBQ is the best Texas style bbq in Portland by a considerable margin. I've been a customer and friendly with him since he started out in a pawn shop parking lot with zero foot traffic and almost no road visibility. He charges $13.50 for a 1/2 lb of brisket, similar prices for other meats. Sides are typically around $3.50. He's up to multiple locations and his own commissary kitchen that's like 2000 sq feet. He sells out every single day. It's been really fun to watch his business blow up. It's all been from the strength of his product, and his personal hustle to get the momentum. His customer base is loyal and willing to pay a premium. He even has a side hustle selling smoker rigs, via a partnership.
    - jessriedel 5y ago
      I'm enjoying this discussion and I'm glad you brought up your example, but keep in mind the sort of folks ordering BBQ in Portland are a very specific class of customers :)
      - jasonwatkinspdx 5y ago
        See my sibling reply.
        jessriedel 5y ago
        Color me unconvinced. I'd wager Matt's customers differ strongly, whether measured by income, self-identified culture, voting pattern, or ethnicity.
        jasonwatkinspdx 5y ago
        Do you have any awareness how obnoxious it is to assert you know my neighborhood better than me? When it's clear you've never been to any of these places, talked with fellow customers, etc? It's a mixed race neighborhood. For the first couple years his neighbor in the pawn shop parking lot was a soul food cart. The clientele at both looked basically the same in terms of demographics. While you won't find as much good BBQ in Portland as say central Texas, the Carolinas, etc, it's not some sort of exotic novelty. I don't know why you are so determined to stereotype this stuff, but it is not helpful.
  - atc 5y ago
    Can you survey your customers?
  - trhway 5y ago
    > I don't reheat/re-use leftovers. ... any unsold product is now a higher loss. Perfect yesterday BBQ meat! Coming from USSR/Russia with its food shortages in 198x-first half of 199x i still kind of mentally shudder reading such things even after 21 years of living here.
    - jessaustin 5y ago
      Yeah, surely there could be some dish made from day-old meat.
      - RyJones 5y ago
        dog food for well-heeled dogs?
        jessaustin 5y ago
        Any chef with any talent could use meat that was cooked literally a day ago in any number of delicious dishes for actual people.
    - tonyb 5y ago
      It’s not waste in that it goes into the trash - it’s just a sink cost that I’ll never recoup. Anything left over I keep for myself, give to friends/family, or donate (which is actually more difficult than you would expect since it is perishable) I’m only open once or twice a week so secondary uses (beans, chili, etc) unfortunately don’t work for me.
  - deleted 5y ago
    [deleted]
- pie420 5y ago
  That's because lobster roll customers are rich yuppies. BBQ is for poor people who cannot afford good cuts of meat so they resort to pulverizing bad cuts of meat with smoke heat and sauce.
  - agogdog 5y ago
    You seem to be getting downvoted, but you're not wrong. They're entirely different ends of the market.
  - jt2190 5y ago
    > BBQ is for poor people... This is really not true anymore. BBQ has become a high-ticket item thanks to “Craft BBQ” and growing demand https://www.khou.com/mobile/article/news/brisket-prices-are-rising-experts-explain-why/285-9c9bf906-57dc-4e32-ac71-0f7211bab0ed https://www.khou.com/mobile/article/news/brisket-prices-are-...
    - throwaway0a5e 5y ago
      You're exactly right that BBQ is popular and that's why BBQ is getting worse. I know I sound like a salty hipster but bear with me for a moment. There's some "show me the incentives I'll show you the outcome" reasoning behind my opinion. When a thing becomes trendy among moneyed demographics there is now stupid money to be made selling a caricature of that thing to people with too much money. BBQ is one of those thigns becoming just another experience for yuppies to talk about in the break room on Mondays. When you're running a BBQ joint you're not selling meat cooked in a particular style, you're selling an experience. People don't care about whether your BBQ is a career long refinement of what grandma made. They care about whether it's something they can brag about. They're looking for an experience and if you want to stay in business you're gonna sell it to them. It's not about doing your thing well, it's about presentation and show. Many of the people running these restaurants hate bastardizing their craft and leaning into an image/stereotype like this but it's what pays the bills. Maybe I'm just jaded from growing up in a tourism economy but money uncritically thrown at something tends to ruin it. When I go looking for a restaurant I go for <censored>, <censored> and <censored>, because those three genres aren't trendy right now and any business specializing in them has to succeed on its own merits, it can't just print money by looking the part.
wenc 5y ago
Brisket prices have been going up for quite a while now, not least since the pandemic started. This event is likely going to be a blip. That said, typically one of the ways to hedge against volatile prices is through forward contracts. If you have a float, have you thought about pre-paying for brisket to get a discount? I only mention this because I remember reading a story told by Nick Kokonas, who co-owns Alinea, a famous 3 Michelin starred restaurant in Chicago. When he discovered he had a float, he decided to pre-pay his vendors instead of taking net 120 and in the process got a 50% discount on beef. (because pre-paying improved his vendor's cashflow and reduced their risk, they passed it back to him in the form of savings) From: https://commoncog.com/blog/cash-flow-games/ https://commoncog.com/blog/cash-flow-games/ "Food costs money. But the way that everyone (in the F&B industry) looks at food costs, and paying for food is very weird. When COVID started, every famous chef that went on TV said, “This is the kind of business where this week’s revenues pay for bills from a month ago.” So when we started to bring in money from deposits and prepaid reservations, I suddenly looked and we had a bank account that had a couple million dollars in it — of forward money "I started calling up some of our big vendors for the big, expensive items — like proteins: meat, fish; luxury items: like caviar, foie gras, wine and liquor, and I said, “I don’t want net-120 anymore, I want to prepay you for the next three months.” And they had never had that kind of a phone call from a restaurant before. So how much should they discount it? So let’s say we’re going to buy steaks. We’re going to pay $34 a pound wholesale for dry aged rib-eye, we get net-120 (normally). So I call the guy and say “I’m going to use 400 pounds of your beef a week for the next 4 months, for our menu, which is about about $300,000 of beef, what (would) we get, if we prepay you?” And he was like “what do you mean?” I’m like “I want to write you a check tomorrow for all of it, for four months.” And he was like, “Well, no one has ever said that.” So he called me the next day, he said “$18 a pound” … so … half. Half price. I went, “I’ll pay you $20 if you tell me why.” And he said, “Well, it’s very simple. I have to slaughter the cows, then I put the beef to dry. For the first 35 days I can sell it. After 35 days there’s only a handful of places that would buy it, after 60 days, I sell it $1 a pound for dog food.” So his waste on the slaughter, and these animals’s lives, and the ethics of all of that, are because of net-120! Seems like someone should have figured this out! As soon as he said that, everything clicked, and I went “We need to call every one of our vendors, every time, and say that we will prepay them.”
sorokod 5y ago
Expect brisket futures to become a thing
- nradov 5y ago
  Cattle futures already exist and prices are up on this news.
- Guest42 5y ago
  Would make for some tough storage if they got stuck not selling them at expiry.
  - deleted 5y ago
    [deleted]
robbmorganf 5y ago
I'm just curious how you started following Hacker News?
- qbasic_forever 5y ago
  A lot of folks work like mad in tech to build up a small nestegg and then go pursue a passion. Starting with a food truck is a great way to suss out and ease into eventually owning and running restaurants. It's like the MVP of a cuisine/restaurant idea.
  - my_usernam3 5y ago
    Yeah that could be true, but I too am curious about /u/tonyb's origin story
  - tonyb 5y ago
    Yep - you are pretty close. I still have my tech job and don’t plan on going full BBQ anytime soon. I do it enough that it keeps me busy but I can always say no to a catering job or event so it’s still enjoyable and not a chore. The right opportunity would have to come along for me to jump onto the restaurant world. It’s definitely something I’ve looked into but one thing I have learned is that the BBQ is the easy part of running a BBQ business - it’s everything else that is tricky. Right now I don’t have to worry about employees, rent, etc. so someone with those strengths would have to make a pretty good pitch to get me to open a restaurant.
- tonyb 5y ago
  The short answer is BBQ is “hobbies gone wild” for me. My “9-5” is in IT and that’s what pays the bills by BBQ is my passion. I’ve being doing BBQ professionally for 10+ years. It started out just done some small catering jobs and has grown from there. Through BBQ I’ve been able to do lots of cool stuff that I would have never imagined when I started. I was heavily involved in competition BBQ for several years and through that I’ve worked with several big brands . Currently I’m focused on my food truck and rub and sauce products. I’ve also done several BBQ classes and hope that as we turn the corner on COVID I can start that up again soon.

by tonyb 5y ago

asdff 5y ago

You could put brisket at market price like lobster roll food trucks tend to do. People still happily pay $18 for a lobster roll from a truck.

tonyb 5y ago
Raising prices is an option but that is very market dependant. BBQ customers in general are more price sensitive than lobster customers and I would lose sales at a higher price point. There is a certain price (which I have generally found is $4.50 - $4.99/lb, that is when my food cost for a brisket sandwich hits 50%. Target food cost should be somewhere around 30%) where it just isn't worth it to sell brisket. BBQ is somewhat unique in that you have to estimate your demand ahead of time - you can't just throw on another brisket if you run out and I don't reheat/re-use leftovers. So even if I raise my prices $2/sandwich to cover the increased cost my risk is still higher because any unsold product is now a higher loss.
- koolba 5y ago
  Is it possible to purchase the cuts in advance and store them frozen or does that noticeably effect the quality? Seems straightforward to through some cuts in a deep freezer to smooth out supply costs. I do that on the small scale at home though obviously the capital costs would be proportionally larger at scale.
  - tonyb 5y ago
    That's exactly what I did starting about a month ago - I've got enough on hand to last about a month (most of that is committed to catering jobs that already have a set price - so my forecasting is much easier but if I didn't lock in the price I would have to eat the difference). As long as they are safely handled I've found no quality difference at all when freezing stuff that is cryo-vaced. More often than not it has already been frozen at least once before it gets to me. I don't ever sell anything that has been re-heated after cooking though. You can also do that with little to no quality loss but I try to position myself as a premium brand so everything is 'cooked to order'. There are also a lot more food safety concerns (cooing it fast enough, re-heating it fast enough, etc.) that I don't want to worry about. I vacuum seal cooked BBQ at home and it's just as good as fresh but you can't do that in a commercial setting without special permits that aren't available to food trucks (at least not in my area).
- jasonwatkinspdx 5y ago
  I'm sure you know your business and market, but I'd just through out an example from my back yard. Matt's BBQ is the best Texas style bbq in Portland by a considerable margin. I've been a customer and friendly with him since he started out in a pawn shop parking lot with zero foot traffic and almost no road visibility. He charges $13.50 for a 1/2 lb of brisket, similar prices for other meats. Sides are typically around $3.50. He's up to multiple locations and his own commissary kitchen that's like 2000 sq feet. He sells out every single day. It's been really fun to watch his business blow up. It's all been from the strength of his product, and his personal hustle to get the momentum. His customer base is loyal and willing to pay a premium. He even has a side hustle selling smoker rigs, via a partnership.
  - jessriedel 5y ago
    I'm enjoying this discussion and I'm glad you brought up your example, but keep in mind the sort of folks ordering BBQ in Portland are a very specific class of customers :)
    - jasonwatkinspdx 5y ago
      See my sibling reply.
      - jessriedel 5y ago
        Color me unconvinced. I'd wager Matt's customers differ strongly, whether measured by income, self-identified culture, voting pattern, or ethnicity.
        jasonwatkinspdx 5y ago
        Do you have any awareness how obnoxious it is to assert you know my neighborhood better than me? When it's clear you've never been to any of these places, talked with fellow customers, etc? It's a mixed race neighborhood. For the first couple years his neighbor in the pawn shop parking lot was a soul food cart. The clientele at both looked basically the same in terms of demographics. While you won't find as much good BBQ in Portland as say central Texas, the Carolinas, etc, it's not some sort of exotic novelty. I don't know why you are so determined to stereotype this stuff, but it is not helpful.
- atc 5y ago
  Can you survey your customers?
- trhway 5y ago
  > I don't reheat/re-use leftovers. ... any unsold product is now a higher loss. Perfect yesterday BBQ meat! Coming from USSR/Russia with its food shortages in 198x-first half of 199x i still kind of mentally shudder reading such things even after 21 years of living here.
  - jessaustin 5y ago
    Yeah, surely there could be some dish made from day-old meat.
    - RyJones 5y ago
      dog food for well-heeled dogs?
      - jessaustin 5y ago
        Any chef with any talent could use meat that was cooked literally a day ago in any number of delicious dishes for actual people.
  - tonyb 5y ago
    It’s not waste in that it goes into the trash - it’s just a sink cost that I’ll never recoup. Anything left over I keep for myself, give to friends/family, or donate (which is actually more difficult than you would expect since it is perishable) I’m only open once or twice a week so secondary uses (beans, chili, etc) unfortunately don’t work for me.
- deleted 5y ago
  [deleted]
pie420 5y ago
That's because lobster roll customers are rich yuppies. BBQ is for poor people who cannot afford good cuts of meat so they resort to pulverizing bad cuts of meat with smoke heat and sauce.
- agogdog 5y ago
  You seem to be getting downvoted, but you're not wrong. They're entirely different ends of the market.
- jt2190 5y ago
  > BBQ is for poor people... This is really not true anymore. BBQ has become a high-ticket item thanks to “Craft BBQ” and growing demand https://www.khou.com/mobile/article/news/brisket-prices-are-rising-experts-explain-why/285-9c9bf906-57dc-4e32-ac71-0f7211bab0ed https://www.khou.com/mobile/article/news/brisket-prices-are-...
  - throwaway0a5e 5y ago
    You're exactly right that BBQ is popular and that's why BBQ is getting worse. I know I sound like a salty hipster but bear with me for a moment. There's some "show me the incentives I'll show you the outcome" reasoning behind my opinion. When a thing becomes trendy among moneyed demographics there is now stupid money to be made selling a caricature of that thing to people with too much money. BBQ is one of those thigns becoming just another experience for yuppies to talk about in the break room on Mondays. When you're running a BBQ joint you're not selling meat cooked in a particular style, you're selling an experience. People don't care about whether your BBQ is a career long refinement of what grandma made. They care about whether it's something they can brag about. They're looking for an experience and if you want to stay in business you're gonna sell it to them. It's not about doing your thing well, it's about presentation and show. Many of the people running these restaurants hate bastardizing their craft and leaning into an image/stereotype like this but it's what pays the bills. Maybe I'm just jaded from growing up in a tourism economy but money uncritically thrown at something tends to ruin it. When I go looking for a restaurant I go for <censored>, <censored> and <censored>, because those three genres aren't trendy right now and any business specializing in them has to succeed on its own merits, it can't just print money by looking the part.

wenc 5y ago

Brisket prices have been going up for quite a while now, not least since the pandemic started. This event is likely going to be a blip. That said, typically one of the ways to hedge against volatile prices is through forward contracts. If you have a float, have you thought about pre-paying for brisket to get a discount? I only mention this because I remember reading a story told by Nick Kokonas, who co-owns Alinea, a famous 3 Michelin starred restaurant in Chicago. When he discovered he had a float, he decided to pre-pay his vendors instead of taking net 120 and in the process got a 50% discount on beef. (because pre-paying improved his vendor's cashflow and reduced their risk, they passed it back to him in the form of savings) From: https://commoncog.com/blog/cash-flow-games/ https://commoncog.com/blog/cash-flow-games/ "Food costs money. But the way that everyone (in the F&B industry) looks at food costs, and paying for food is very weird. When COVID started, every famous chef that went on TV said, “This is the kind of business where this week’s revenues pay for bills from a month ago.” So when we started to bring in money from deposits and prepaid reservations, I suddenly looked and we had a bank account that had a couple million dollars in it — of forward money "I started calling up some of our big vendors for the big, expensive items — like proteins: meat, fish; luxury items: like caviar, foie gras, wine and liquor, and I said, “I don’t want net-120 anymore, I want to prepay you for the next three months.” And they had never had that kind of a phone call from a restaurant before. So how much should they discount it? So let’s say we’re going to buy steaks. We’re going to pay $34 a pound wholesale for dry aged rib-eye, we get net-120 (normally). So I call the guy and say “I’m going to use 400 pounds of your beef a week for the next 4 months, for our menu, which is about about $300,000 of beef, what (would) we get, if we prepay you?” And he was like “what do you mean?” I’m like “I want to write you a check tomorrow for all of it, for four months.” And he was like, “Well, no one has ever said that.” So he called me the next day, he said “$18 a pound” … so … half. Half price. I went, “I’ll pay you $20 if you tell me why.” And he said, “Well, it’s very simple. I have to slaughter the cows, then I put the beef to dry. For the first 35 days I can sell it. After 35 days there’s only a handful of places that would buy it, after 60 days, I sell it $1 a pound for dog food.” So his waste on the slaughter, and these animals’s lives, and the ethics of all of that, are because of net-120! Seems like someone should have figured this out! As soon as he said that, everything clicked, and I went “We need to call every one of our vendors, every time, and say that we will prepay them.”

sorokod 5y ago

Expect brisket futures to become a thing

nradov 5y ago
Cattle futures already exist and prices are up on this news.
Guest42 5y ago
Would make for some tough storage if they got stuck not selling them at expiry.
- deleted 5y ago
  [deleted]

robbmorganf 5y ago

I'm just curious how you started following Hacker News?

qbasic_forever 5y ago
A lot of folks work like mad in tech to build up a small nestegg and then go pursue a passion. Starting with a food truck is a great way to suss out and ease into eventually owning and running restaurants. It's like the MVP of a cuisine/restaurant idea.
- my_usernam3 5y ago
  Yeah that could be true, but I too am curious about /u/tonyb's origin story
- tonyb 5y ago
  Yep - you are pretty close. I still have my tech job and don’t plan on going full BBQ anytime soon. I do it enough that it keeps me busy but I can always say no to a catering job or event so it’s still enjoyable and not a chore. The right opportunity would have to come along for me to jump onto the restaurant world. It’s definitely something I’ve looked into but one thing I have learned is that the BBQ is the easy part of running a BBQ business - it’s everything else that is tricky. Right now I don’t have to worry about employees, rent, etc. so someone with those strengths would have to make a pretty good pitch to get me to open a restaurant.
tonyb 5y ago
The short answer is BBQ is “hobbies gone wild” for me. My “9-5” is in IT and that’s what pays the bills by BBQ is my passion. I’ve being doing BBQ professionally for 10+ years. It started out just done some small catering jobs and has grown from there. Through BBQ I’ve been able to do lots of cool stuff that I would have never imagined when I started. I was heavily involved in competition BBQ for several years and through that I’ve worked with several big brands . Currently I’m focused on my food truck and rub and sauce products. I’ve also done several BBQ classes and hope that as we turn the corner on COVID I can start that up again soon.