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Dec 30, 2009 08:09 AM

Happy Hour Madness at Elliott's Oyster House

I have spilled many words on Chowhound extolling the virtues of Elliott’s Oyster House for its huge selection of impeccably fresh Pacific Northwest oysters. Along with many other Chowhounds, I have also spread the word about the great bargain to be had at Elliott’s progressive oyster happy hour, where a house selected oyster can be purchased starting at 3:00 pm for 50 cents, with the price increasing every half hour by 25 cents until, at 6:00 pm, the price returns to the normal price of $13 per half-dozen or $23 per dozen for Washington oysters. (Canadian oysters and varieties other than Pacific oysters are more expensive.) The problem is that the happy-hour specials are served only at the oyster bar, the cocktail bar, and a handful of tables in the bar area. So, in high demand times, like the Christmas and New Year holiday season, it is almost impossible to take advantage of the happy hour specials unless you get there early, say 2:00 or 2:30 pm, snag a seat at the bar or a table in the bar area, and order some food off the full-priced menu – say a salad – to hold the spot until 3:00 pm when the happy hour begins. Interestingly, although it is almost impossible to get a happy hour spot after 3:00 pm in these high-demand times, there are many tables in the “dining areas” that are vacant and unused. Yesterday, for example, the dining area east of the oyster bar was totally empty. So what is the business strategy behind a long line of people waiting for a happy-hour seat, and many more people turning around and leaving because they correctly perceive that the odds of getting a seat anytime before 6:00 pm are minimal and not worth the long wait, despite an abundance of empty tables elsewhere in the restaurant? If the restaurant makes money on its happy hour, why not fill the empty tables, at least between 3:00 and 4:00 pm since the happy hour folks seated outside the bar area will most likely be on their way by 6:00 pm, thereby opening up the tables for the full-price dinner patrons? If, on the other hand, the happy hour is a loss leader, why have it at all, at least without raising prices enough to make a profit? I’m not much of a happy hour person, but the policy at Elliott’s has aroused my curiosity about the happy hour polices at other restaurants. Is limiting the happy hour specials to those sitting at the bar or in the lounge area (as opposed to the dining area) common practice? If so, do other popular happy hours, like the one at Brasa for example, suffer from the same kind of competition for a seat as Elliott’s?

Elliott's Oyster House
1201 Alaskan Way, Seattle, WA 98101

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  1. Hmmm interesting. Perhaps they are trying to create some buzz. Maybe they aren't making that much money on the happy hour and are trying to get people just to settle and eat off the full price menu.

    Also it could do with the wait staff, not being equipped with enough staff to run full service at the tables. If they limit it to these areas then less staff is used. If they have to add extra staff to handle the crowds for Happy hour that eats into their budget when they are already serving discounted prices, and discounted prices usually means lower tips.

    1. Speculation:

      They almost certainly do not make money on the oysters during the early part of happy hour. It's a loss leader to get people to buy drinks and full-priced oysters or other menu items.

      There's a limit to how quickly the shuckers can do their business; that's the limiting factor on speed of service. It's not fast now when they're busy at happy hour; I've had a dozen oysters take 25 minutes from order to service (not counting time spent trying to flag down a server) during happy hour. If they filled the place, it'd take an hour which would ruin the experience pretty quick.

      Limiting it to the bar area also helps ensure that the vast majority of people will be old enough to actually order drinks and will have the bar within line-of-sight. It also builds buzz and encourages people to come back at normally slow times. (It works - I only go mid-week and outside major holiday and tourist seasons when I can sit down right away and not wait forever for my order. They're happy for my business then, and I'm happy because there's no hassle. Win-win.)

      1. "why have it at all, at least without raising prices enough to make a profit?"

        Gee, a restaurant offers a great deal (below profitability) and you're complaining?
        Thanks for trying to ruin it for everyone Tom...
        Why don't you tell bartenders to quit offering up free drinks to regulars or restaurants to stop comping desserts on birthdays? (I mean why is it fair that some people get free stuff and I don't. In the long run, it surely results in higher prices on my food bill...)

        Agree with Terrier. Just go on Tuesdays outside of the touristy season or accept that it's going to be crowded/you may not get a seat.
        (or alternately, pay the regular prices at regular times when there may be less people and you can have a more relaxed dining experience)

        It's the "hospitality BUSINESS". They'll treat you nicely, but at the end of the day these are profit driven operations. They're not trying to do everything towards the consumers benefit.

        2 Replies
        1. re: GreenYoshi

          No business, restaurants incuded, intentionally engage in a practice that will, overall, lose money. Businesses engage in loss-leaders because they believe that they will draw customers into their stores who will then purchase other items in sufficient quantity to result in a net profit. Restaurants comp food and drinks on birthdays and other special occasions for the same reason -- they are counting on building loyality that will result in a future stream of profitable business. I still think my questions were legitimate, and I really don't understand the point of your response. Like, duh, I don't understand that restaurants are in business to make a profit?? I don't know the exact math, but even at the low happy hour prices for oysters, the restaurant still makes money on the discounted booze prices. And staffing is a variable, not a fixed, cost. If it makes economic sense, any restaurant can add staff to produce more profits.

          1. re: Tom Armitage

            Staffing is variable only in the long term. That is, if you get more people than you expected on a given night, you can't adjust immediately. Similarly, it's difficult to hire someone for just a 3 hour shift (ie, just happy hour). Let's recall a big part of the why restaurants do happy hours is to increase productivity during what would usually be a slow (inefficient) portion of a workers shift (i hear a big part of the financial viability of Subway's $5 footlongs is because worker productivity is increased to compensate for the lower price). To hire more people for this specific time is unnecessary from the restaurant perspective. Why should the restaurant cater to these diners who only come during this less profitable time?

            A more general thought. In my professional life, I am a mediocre economist. I once sat with another (better) economist, and we tried to figure out how much the restaurant we were sitting at was making in a given night. By our figures the restaurant couldn't help but lose money every single night... Obviously this couldn't be true, and we were missing something that the business owner understood.

            Point being, it's tough to really understand a business unless you're the proprietor. Speculate all you want, but unless you can see complete real data on sales and costs, it's tough to fully understand the additive value of any promotion.

            Basically, they're probably doing it right.
            That it doesn't make sense to you, most likely means you're missing some factor in how the business works.

        2. The original comment has been removed
          1. There's a small side-effect of limiting the happy hour spaces, in addition to what people have mentioned so far.

            My folks were visiting so I took them to Elliott's Xmas eve at 3pm, and got a seat at one of the tables at 3:50. During that near hour of waiting, yes, there was a huge crowd of people piling up. Among us, I saw at least 2 groups decide to go to a regular table for full price fare. The extra $$ for the restaurant probably doesn't make up for the money lost, but at least there's some offset.

            1 Reply
            1. re: skibum400

              I had thought about the fact that some would opt for the full price fare if it was too crowded, although I disagree that they loose money. They wouldn't do it if there wasn't a profit margine, and 3-6 for most restaurants is a slower time because it is imbetween meals.

              I think everyone has brought up good points, all very worthy of the reason why they limit the tables so maybe its all of the reasons put together. They have enough buzz around them now that people, especial tourist who are able and willing to spend money will just come back, or opt for the full price tables and menu,