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Startup Sells "Prime" Reservations (Table8)

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  • leefc Apr 15, 2014 02:10 PM
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Startup Table8 is now partnering with select restaurants to keep some reservations off the books and selling them at a premium to diners.

Not sure how a I feel about this yet. Although OpenTable charges restaurants, diners have an equal chance to get the reservation. With Table8, the table goes to those willing to pay extra.

Although not stated in their plans, it would make sense to extend the concept to allow bidding.

http://sf.eater.com/archives/2014/04/...

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  1. Seems like a smart idea as the simple fact that there's demand for it suggests that these restaurants are actually (at least at certain times) underpriced. Although I'm not sure their current pricing - effectively a $5-10pp "tax" on those who want reservation priority - will really do much to encourage market efficiency and minimize the headache of waiting for a table as a walk-in. Instead it seems like this is basically going to be a small extra profit for the restaurants, leaving about the same number of frustrated diners who can't get a table but aren't actually priced out, while giving a big cut to Table8 for providing a service that the restaurants either weren't competent to figure out themselves, or didn't want to be directly associated with.

    2 Replies
    1. re: bigwheel042

      They basically take 2 tables out of rotation each night and let someone else sell them for a $20 premium. Those tables would have gotten booked regardless. The blockheads paying a premium for these tables are doing so only because the restaurant's sold them to this app. So essentially the restaurant is charging 2 tables an exorbitant booking fee each night... for no good reason at all. And this is good/helpful to diners how?? Because it allows people willing to fork over the fee a chance to dine at the same table they could have otherwise booked for free through the restaurant or OpenTable directly? Because... why??

      Any restaurant that can fill it's seats on any given night of the week would surely see no merit in this. What's the purpose or benefit to the restaurant... an extra $40 / night?

      Any restaurant that struggles to pack it in (I could walk in to Waterbar any night of the week and wait 10-15 min. MAX for a table) would also not really benefit because who is suddenly willing to spend $20 for a reservation at a place that isn't filled?

      Unless they are holding these tables and releasing them at the last minute (on the very night of - or the day before) then I don't understand who will benefit or even use this app. If I wanted to get into Boulevard for example, I could go on OT right now and make a reservation for this coming weekend without issue.

      It sounds like a fairly useless resource for nobody but the developpers. Basically they attempt to guage prime hours when these restaurants are typically filled, pull out a couple of tables thereby creating the problem... and then charge for the solution. They're banking on people who wouldn't rather just eat an hour earlier, later, or somewhere else entirely... I'd sooner chose any of the above before supporting what seems like a brainless tool that does more harm than good (if any - I still can't figure out how).

      1. re: OliverB

        I dont think you can discount the potential value, to the restaurateur, of knowing two tables will be filled with people who dont mind paying a fee for something they could easily avoid. id assume these people will order more and pay more than my other tables - and it comes with the distinct benefit of not having to count on this type of customer for 100% of ones business (as moving to an exclusively pay-for-reservations system would do).

        your underestimating the interest in a "brainless tool that does more harm than good" by people with more money than good sense.

    2. Next up: restaurants to charge extra for; a) phone calls for reservations, b) chairs while waiting, c) chairs while dining.

      Extra charges for use of a fork is currently under discussion.

      Okay seriously, sounds like this will only fly at a few places that are always over booked. I'm inclined not to use it, or go to a place that does.

      23 Replies
      1. re: ML8000

        Which is exactly the point - if the restaurant is finding demand so far outstrips their capacity that having more potential customers does them no actual good anyway, it makes sense for them to start segmenting their customer base into "customers who want to eat here so so much on Saturday at 8 PM that they will pay extra for the privilege" and "customers who want to eat here somewhat less and won't." Sort of the flip side of coupons/restaurant.com gift certificates/opentable 1000-point tables, which segment the other way for restaurants that are underbooked: "customers who like our restaurant enough to pay full menu price on Wednesday night" and "customers who won't come here unless we give them a deal."

        While the price increase makes me marginally less likely to want to eat at Slanted Door or whatever, on the whole I welcome this because it encourages new restaurateurs to open more places to try and capture some of the market for themselves, since the status quo clearly seems not to be meeting all the demand for it.

        1. re: bigwheel042

          I don't understand this reasoning... if the restaurant is so successful that demand outweighs capacity, why would they feel the need to up-price a table for a measly $20 instead of just fill it like every other table in the restaurant, since the demand exists and they have the client base?

          How could having "more potential customers do them no actual good anyway" - are you suggesting they are understaffed or something? Filling a table is always good. There's no such thing as customers doing no actual good to a restaurant.

          Consider this in another light... every restaurant in San Francisco will now charge $25 for the privilege of reserving a seat every Thursday, Friday and Saturday nights.

          Probably not a very popular suggestion, huh?

          This one is just as shitty but makes even less sense, as they're only pulling out 2 tables a night and charging a minimal amount... so creating less capacity despite the existing demand... but charging a "privelege" fee. How pretentious can you get? So some schlub sitting next to you might end up paying $20 more for the same table at the same time for no good reason.

          This is the very definition of creating a solution for a problem that doesn't exist to begin with.

          If they really wanted to "level the playing field" they would charge a $20 booking fee for every single table in the restaurant at prime time on a weekend... then see their app fail miserably and watch as bookings decline.

          By limiting it to a couple of tables, they're creating some elitist lotto that is anything but "level". I like how the sf.eater article mentions "normal people". Normal people either plan ahead or make do if they don't for whatever reason and can't get a seating. Let's not pretend that this is creating more capacity... it's doing the opposit by limiting capacity but charging for it, thereby kicking the "normal people" in the ass. Seems disloyal to any restaurant's customer base and a paltry amount to make any difference. $40 is really a negligible increase in nightly earnings for a popular restaurant.

          1. re: OliverB

            If you have 100 seats and 3 seatings/night, and are drawing 300 every single night with an extra 50 walk-ins who wait in frustration for 75 minutes before leaving, then drawing another 100 potential customers a night does you no good. You can't serve these people without building yourself another restaurant (which Charles Phan has assiduously been doing, it just takes him a few years every time). Maybe Boulevard really has empty tables at peak times all the time, but clearly they think there's extra money to be made here or they wouldn't be signing up.

            1. re: bigwheel042

              The good it does is perpetuates demand... which is what every successful restaurant in the world wants and needs. I'd rather have a dining establishment with long lines around the block and one-month advance bookings, then a place with regular nightly walk-ins, obviously.

              This app doesn't attempt to solve these restraints though... it exagerrates them by keeping more regular diners out when space is already full (if not, why bother because who'd pay more??)

              Frankly, I've never had a problem getting into Boulevard with a couple of day's notice. If I were visiting from out of town and needed last minute reservations and absolutely had to visit Boulevard, chances are slim the app would help if they're only setting aside 2 tables... unless they're planning on it being as unpopular a tool as it is useful! ;)

              If the restaurant is not SO popular that you *might be able to squeeze in on a prime night ocassionally, then this basically creates demand wher it was borderline before. Now there's no chance of scoring a table whereas before it was a possibility. Selling water to fish, right?

              1. re: OliverB

                Not sure why you keep saying that there are only two Table8 tables per restaurant. Eater says a "handful", so probably each restaurant is setting aside however many they think will book.

                Frankly I find the economic logic used in your last paragraph tortured. Either the demand for seats is there or it isn't - the quantity of available seats supplied has negligible/no effect on it. If the restaurant isn't so popular that there's some softness in demand for seats on prime nights, then it doesn't make sense for the restaurant to use Table8 for those tables and they'll open them up so walk-ins can snag them. Clearly the restaurants who are piloting Table8 believe they are unlikely to often encounter such a situation.

                1. re: bigwheel042

                  I thought I had read that they were only allocating 2 tables nightly, which may contribute partly to the confusion on my end.

                  I don't understand how you find the conomic logic tortured... I was merely suggesting that if a restaurant such as Commonwealth for instance, which is not terribly difficult to get into (there are typically a couple of walk-in seats available on any given night) were to restrict several seats in their already limited space to Table8... then suddenly a restaurant that is able to fill it's dining room to near capacity yet doesn't have the demand to oversell... could suddenly find itself in a potentially different position. Someone like myself who might have otherwise called for a last-minute reservation, could find it completely sold out... if I were some privileged tech guy who thought this Table8 was a great resource, I might then go ahead and book the table (that would have otherwise been available were it not for this app!) at extra cost.

                  If you have 20 seats in house and only fill 17 by reservation on average per night with ocassional last minute calls or walk-ins... then suddenly reduce the 20 seats to 15... you've just created demand.

                  1. re: OliverB

                    No. No. No. You have reduced the quantity of seats supplied, which is not at all the same thing as "creating demand".

                    The demand for (on average) 17 seats (+whatever you average in walk-ins and call-aheads) exists regardless of how many seats you actually can supply. You can mess with the channels for how that demand manifests (say, by switching to a no-reservations policy or moving some tables over to Table8) but it fundamentally doesn't have a meaningful effect on how many customers are going to want to eat at your restaurant every night, which is what demand is.

                    1. re: bigwheel042

                      Okay, well I suck at math/economics (which is why I'm not building pretentious apps like this!) so I'll take yoru word for it. :)

                  2. re: bigwheel042

                    I think I may have had a one too many glasses of rose this afternoon as it's confusing to read it back to myself...

                    Basically if you have a small space that can accommodate x-amount of people and then suddenly reduce that space even more, you are creating more demand because it can accommodate less people. The quantity of seats certainly factors in.

                    I just sent an out of town friend to Bar Crudo this aft as she was in the mood for a crab sandwich and oysters. There are not many tables and there's ocassionally small line-ups at happy hour. If Crudo eliminated 10 seats then the small line-ups might be a bit longer. The demand isn't really a variable factor when it's proportional to the capacity... Once you reduce the capacity, you increase the demand because there are more people who want to patronize an establishment than the space can accommodate.

                    There's more of a demand for limes right now because there is a shortage of supply. That doesn't necessarily mean that more people love limes... it means there are less limes than there are people who want them. When a restaurant takes away seats, it increases demand... unless nobody cares about the restaurant eitherway and it isn't ever near capacity. In which case, I think this app would be useless to all.

                    1. re: OliverB

                      NO. Reducing the quantity of product you can supply has no effect on demand, any more than Foxconn torching one of its own iPhone factories is going to cause another million people to want to buy iPhones. The only things that are going to change is the market price and the quantity purchased - the quantity has to decrease because Apple can't make as many iPhones, and the price will theoretically increase because the existing customers will now be facing a shortage of iPhones and some of them will be driving the price up. This is literally economics 101 - if you're unclear on this, you might want to read up on the difference between "quantity demanded" and "demand curve".

              2. re: OliverB

                That was my second reaction: this got VC money and launched because in the moneyed tech world the idea makes sense, and if they want something now, they want to NOW and they wait for no one damn it!

                So basically they're paying extra for not having planning skills or social skills to figure it out...like slipping someone $50 bucks, or just being nice.

                1. re: ML8000

                  Last I checked, $20-25 < $50. :)

                  1. re: bigwheel042

                    Yeah but the person getting the $50 in person will remember you, give you a better table and there's next time. (something an app can't do) People remember $50 bucks and can respond again. You just have to ask their name and remember to thank them on your way out. See what I mean by lack of social skills? :)

                    1. re: ML8000

                      As much as it doesn't sound nice to say it, I imagine that restaurants might figure that the target customers for Table8 aren't the type to always come back after trying a hot place once. (Does anyone honestly think that Slanted Door relies on regulars for the health of its business?)

                      Plus, under Table8 the restaurant gets to pocket the $25, rather than having $50 go to grease the host (assuming this would even work at a crowded Spruce or a Slanted Door, which I doubt because it would essentially entail infuriating someone else with an extant reservation).

                      1. re: bigwheel042

                        Call me old fashion but I'd rather give money to a person who can use it, appreciate it and help me right then and there.

                        As for infuriating someone - again, social skill.

                        1. re: ML8000

                          That's great but we're not really discussing what's morally optimal for hipster customers who totally went to these places before they were cool. The discussion is about why it would be rational from the restaurant's perspective to adopt Table8 rather than encourage the old-school system of greasing.

                          1. re: bigwheel042

                            I'd still like to understand how these restaurants project that this tool will be an advantage to them at all. Obviously they believe this... or they're just being paid off to participate by targeting a few popular names and hoping that others will want to follow suit, which I highly doubt is what's happening.

                            1. re: bigwheel042

                              WTFugu are you talking about?

                              1. re: bigwheel042

                                have you looked at the list? Most of these places aren't currently the most in demand places at all. I could get a table at any of them for this weekend or for tonight. I personally like Farallon and Fleur De Lys but it's been years since either was considered cool or must go places.

                                Here's Table8's current stable of SF restaurants:

                                Acquerello
                                Aziza
                                Boulevard
                                Central Kitchen
                                Farallon
                                Fleur De Lys
                                Hard Water
                                La Folie
                                Roka Akor
                                Slanted Door
                                Spruce
                                Waterbar

                                1. re: tjinsf

                                  I've made same-night reservations at Acquerello, Aziza, Boulevard, and Waterbar on multiple ocassions (well, only once for Aziza). I've also easily gotten res at Fleur de Lys and La Folie at the last minute; I think I had to cancel both times the day before for different reasons, but I don't understand how holding back tables and charging a premium at places that can't even fill to near capacity would benefit or be of use to anyone. They'd have to hold back a LOT of tables. Waterbar is great btw and I love that I can walk in any day at just about any time and get a seating. The views are unbeatable!

                                  1. re: OliverB

                                    I think that your experience as a San Francisco resident trying to eat by yourself or with one companion, is very different from the people who would use this service.

                                    I had very bad luck getting reservations for 4 at Waterbar when there were limited dates and times that would work for everyone in my party. Tried Open Table and tried calling them - they were booked solid. And I was trying a month out. If this service had been available, I could have tried that as well.

                                    When people are meeting up and coming from very different starting points, you can't be casual and just stroll around looking for a place. You need a reservation.

                                    I would imagine that the restaurants that have signed up are considering this a trial run and seeing how it affects their business. That's how you run a successful business.

                      2. re: ML8000

                        If I knew how to create an app, I'd restrict posting on all messageboards including Chowhound between 5:00-7:00 PM daily, except for those willing to fork over $5/day or $20/week. As these are the peak times for site traffic at the close of the work day, it levels the playing field by freeing up space on the servers and allowing those who truly appreciate the website to contribute to it's continued operation... meanwhile, I'd get rich from sponsorship and ads, probably with other people's startup money.

                        1. re: OliverB

                          What you expect "advice neutrality"? Well forget that!

                2. Of the restaurants listed, I can say from experience that Boulevard, Acquerello, and Waterbar are never difficult to get into making this seem rather pointless. I could see someone paying a premium for a table at Nopa or something... but this whole concept seems stupid to me as it's not that difficult to plan ahead and it's the fault of the diner for not considering to do so thereby not being able to score a seat. The fact is that any restaurant with a long wait list weeks in advance will not benefit from this app because the nightly tables will get booked just as soon, meaning that people will needlessly be paying $20 for a seat that could have been booked by the same person on the same date, were in not allocated to this new app. Unless I'm misunderstanding, this doesn't exactly "level the playing field" as the article suggests. It seems more elitist if anything.

                  2 Replies
                  1. re: OliverB

                    Oh, it's definitely more elitist - that line about "leveling the playing field" is clearly PR mumbo-jumbo that hinges on how you define a "normal" person. Seems like it really means "someone who's not food-obsessed enough to think about booking weeks in advance but wants to try somewhere on a whim and has no problem giving up a little more disposable income for it."

                    Still, on balance I'm OK with restaurants charging what the market will bear. I don't have a God-given right to a table at Spruce if someone wants to pay more than me for it, and there are plenty of less-trendy and cheaper restaurants in this town that will be more than happy to serve me.

                    (The alternatives to adopting a system like this, for a restaurant, are to a) leave some money on the table that they could have actually made and b) just hike menu prices a little so the increase falls on everyone. Both are inefficient - you can only hike prices so much before you start ending up with empty seats off-peak, so using a Table8 allows you to keep prices lower for off-peak diners while getting a little more out of some tables at peak times.)

                    1. re: bigwheel042

                      I just don't think that pulling out 2 tables per night will be enough to make any difference in diner's booking habits as nobody will notice... it's not like your or I will know which tables are being allocated to Table8 at precisely what times. We'll just try to get a reservation per usual and if it's booked solid and one were so inclined to check out Table8, we'd still not be at any advantage - with a 2 table limit, they'll either be available or not. So why is it a significant benefit to anyone? It seems like a wheel of fortune kind of thing... if you're lucky enough to have booked during peak hours and a table is avail. on the app, you can pay more to book it (assuming there are no earlier/later reservations and you have a flexible dining shcedule) but there's no rhyme or reason to using this. It's not an app that's very well though out imo, nor does it make much sense. I really don't think it will create more demand for off-hour seats because we're talking about 2 random tables nightly and most diners will be clueless to this. It's literally just... "let's create an app selling water to fish!"

                  2. Is this concept even new? I seem to remember some website many years ago that sold reservations for popular places at a premium. But why not? Restaurants already do the converse by offering 1000 points on OpenTable for hard-to-fill slots. So if it's OK to give a discount for the least popular slots, why not charge a premium for the prime ones in so far you can get away with it?

                    19 Replies
                    1. re: nocharge

                      Because of the basic principles of supply and demand.

                      The restaurant is operating at a loss when the kitchen and staff are paid but the room is empty. They offer points as incentive to create demand. When demand exists, there's no good reason in the world to charge additional costs for the same experience and service. It's a silly concept.

                      The solution is to scrap the OT points, forgo happy hour, and just open later in the evenings... or if the foot traffic gained from the offer of added amenities at otherwise hard-to-fill time slots outweighs the loss of revenue from not operating at all, then keep on. That's how business works.

                      It's pointless to create solutions to problems that don't exist. Having a full house in a restaurant is the very essence of a problem that isn't.

                      1. re: OliverB

                        Airlines do everything they can to maximize profits by adjusting prices to demand. Charge less for challenging time slots, charge more for premium ones. Restaurants do the same, to some extent, by offering 1000 OT points for some time slots but not for others. Restaurants have to pay their rents, retain their staff, etc. If giving points on OT or having happy hours help to retain the staff by giving them more hours, it may be worthwhile even if the restaurant just breaks even.

                        1. re: nocharge

                          I hope we're not using the commercial airline industry as a standard or prototype now... you couldn't really chose a worse example to follow. What I want to know is why anyone on here, as conscious consumers, would actually defend these bad decisions and poor business practices?

                          1. re: OliverB

                            Oh, the US commercial airlines are horrible. Everyone knows that. But they have lots of issues including unions and stuff. However, I don't think that adjusting pricing to supply and demand is a "poor business practice". If you make more money by lowering your ticket prices to fill up a plane that would otherwise be half empty or jack up the price when there is strong demand, how is that a "poor business practice"?

                          2. re: nocharge

                            And that's why some of us don't fly certain airlines. Restaurants should choose to emulate airline policies at their own peril.

                            1. re: tjinsf

                              Of course, it's not just airlines, it hotels, Uber, and pretty much any kind of business. If you don't react to supply and demand when it comes to pricing, your business is not running a tight ship.

                              I hear limes are kind of expensive right now. Why? Supply and demand issues.

                              1. re: nocharge

                                Mr. Charge:

                                This isnt a supply and demand issue, it is an issue of price discrimination. i.e. it is a change to the *price structure*, having multiple prices for one good, not the *price level*.

                                price discrimination is efficient for the seller even where there isnt excess demand, since what is at issue is not the price+quantity but the disposition of the consumer surplus.

                                [You can argue it is not a complete clean case of price discrimination because the goods are not exactly the same, but that's more or less accounted for in the more robust version of the analysis ... creating a "close good" just to justify the multi-tired price. Following A. PIGOU, it will be interesting to see if this ends up looking more like 2nd degree [different classes of plane travel ... bootstrapping a "luxury good"] or 3rd deg [student discounts] price discrimination.]

                                1. re: psb

                                  Not sure if we are discussing the same thing here since the thread has been all over the place. But an airline or a hotel or a restaurant (by giving fewer OT points) charging more during peak demand is a matter of supply and demand. An airline having different pricing categories, including student discounts, is a matter of price discrimination. Of course, anyone familiar with Ramsey pricing will know that under certain circumstances, price discrimination may maximize total welfare.

                                  1. re: nocharge

                                    Supply and Demand is more a case of flights to Europe costing more in AUG than FEB ... all tix are more and ostensibly there are more flights as well.

                                    A nice and clean example of price discrimination are higher-priced hardback copies of certain high-demand books, such as H. POTTER books only being available at first.

                                    I believe one of Chowhound Farris's associates was involved in the recent Sup Ct case on ASIAN DISCOUNT MATH BOOK ARBITRAGE:
                                    http://en.wikipedia.org/wiki/Kirtsaen....

                                    Movie pricing is also a bit cleaner than the airline example ... of course there are supply-side responses like showing the same movie on multiple screens at the same time, or in a larger theater, more theater. But the price-discrim cases are traditionally student tix, and matinee discounts [yes, in a G.E. approach you can argue a 2pm and 8pm showing of the movie are different goods, but we can avoid that issue fairly easily]. Now there are innovations in price-discrimination like the KABUKI is doing ... dont they have some highly granular surcharges, like for Fri/Sat night? Now it it is interesting that theaters have not traditionally charged different prices for different movies in the same theater. In some countries, different seats have different charges, but even in theaters with reserved seating, I am unaware of a "center of the theater" premium or a front row discount [maybe the Kabuki does this? IMAX reserved seating appears not to do that] in the United States. I think one of the mega-blockbusters had a first-show premium ... like $20, no?

                                    So it seems the Kabuki's innovations in price discrim have been successful in the movie business. We'll see if it works with restaurants.

                                    On a supply and demand note, it appears TAQUERIA VALLARTAS increase in taco prices from $1.50 -> $1.75 -> $2may have gone awry, as now they are offering 4tacos/$7 with a free agua fresca. I am not 100% sure if this is true at both the 24th street and excelsior branches ... I'm also not a 100% sure this is correct, but I believe the prices in the Excelsior may have lagged 24th street. Although I suppose there is not really an opportunity for TACO ARBITRAGE.

                                    >may maximize total welfare.
                                    >
                                    you say that as if it is a good thing :-) i think a wholesale vacuuming up of consumer surplus is not a great thing. without side-payments, it is not pareto-improving.

                                    does cheeseboard still do age-based price discrimination? maybe if you can find a 100 y.o., you could CHEESE ARBITRAGE.

                                    i'm a little curious if any ethnic restaurants do any price discrimination, either verbally, or based on reading ability in a foreign language. i have been offered a "cash discount" at a certain restaurant from the country whose passport i carry. but i think that was based on their perception that i'd be open to helping them engage in tax fraud [it was a 10% discount, so much larger than credit card charges] rather than WTP/3rd deg price discrimination.

                                    1. re: psb

                                      "i think a wholesale vacuuming up of consumer surplus is not a great thing."

                                      Depends on what you're comparing it to. Compared to the price status quo, it's a net loss for consumers, who are reaping the benefit of an underpricing situation. Compared to the blunt alternative wherein the restaurant just hikes prices across the board, it could be a benefit for the subset of consumers who aren't facing an increase and otherwise would.

                                      High-end sushi bars are reputed to give significant discounts for better-quality fish for their regulars.

                                      1. re: bigwheel042

                                        > it's a net loss for consumers
                                        >
                                        yes, i agree. i think tweaks here and there (may) change the dining experience in interesting ways.

                                        i.e. what's going to the be resto equivalent of "no you cant use the business/first class bathroom".

                                        for example it would obviously be "odd" for a restaurant to say "we have three porterhouses left ... we will auction them off". under premium seating, what are the odds a kitchen may allow for "out of order execution" ... the Big Spender wants the porterhouse? ... tell the Country Cousin we're out, eventhough he ordered his first."

                                        one of the posts in this thread was from a dood who was a regular at a resto and got his friends a table right then and there. so did the resto lie to the friend when they said no tables or did they bump some lower status guest? i have no problem with regulars getting comped items or perhaps a nicer table when there is a "tie' in precedence, but if you honor your side of the reservation and you're bumped for an insider, that's kinda lame in my book. you can retort "it's a business", but this kind of standing on your rights rather than a more collegial, put yourself in the other persons shoes, attitude leads to assertions like "once i am seated, i can linger as long as i want ... it's their problem if the resto is crowded".

                                        yeah, there are definitely gaps between aggregate effects and individual outcomes ... e.g. obviously i am not pro sleazy practices of credit card issuers and banks w.r.t. to fees and penalties, but at a certain level these are great for me, because the more they can gouge "them", the less likely they are to come after me with fees for routine services.

                                        seeking to monetize/optimal price/nickle and dime the whole resto experience will likely change it for the worse, eventhough in the abstract, it certainly efficient to say charge for bread. but i would find a bread charge annoying ... with free bread or olives, you feel like it is a little gift. on the other hand, i am always happy wtih places that dont bundle fries with a burger.

                                        [although i realize bundling things with close to 0 cost like soda and fries are a bit special, as opposed to bread which may have to be sourced from a third party].

                                        1. re: psb

                                          "one of the posts in this thread was from a dood who was a regular at a resto and got his friends a table right then and there. so did the resto lie to the friend when they said no tables or did they bump some lower status guest?"

                                          I don't think you understand how a large enough restaurant operates. It doesn't necessarily fill every possible seat, especially if some of them are marginal. What if some VIP comes by? The kitchen may be busy enough already. In addition to the 125 people in the dining room, you have 75 people drinking in the lounge. Some of them might be ordering food, you just don't know exactly how many. And you know that there will be no-shows. The bottom line is that restaurants that are large enough often have a lot of room for juggling things around when it comes to giving someone a table.

                                          1. re: nocharge

                                            75 people drinking in the lounge? What restaurant is this massive, or does this much business in the bar? Let's put it this way, 75 is also the total players who are in the starting lineups of all the teams in the NBA Western Conference. Imagine squeezing 15 basketball teams into a single restaurant lounge.

                                            1. re: dunstable

                                              It was a hypothetical example, but there are places with substantial lounge areas, like Ozumo, where coincidentally I've seen both Michael Jordan and Dirk Nowitzki dine, though not at the same time. Pretty sure you could squeeze in 75 there although some of them might have to stand. The now-gone Cosmopolitan could probably squeeze in quite a few people between its two bars and lounge area that also included a bunch of seats outside. Might have been able to squeeze in 75 with a lot of them standing.

                                              1. re: nocharge

                                                Oh, and I totally didn't think about Americano. Count the number of people having drinks there after work in the lounge or on the patio on a Friday when the weather is nice and the number is mind-blowing.

                                            2. re: nocharge

                                              >I don't think you understand how a large
                                              >enough restaurant operates ...
                                              >
                                              that's why i expressed the issue in generic terms.

                                              if favoring customer A essentially comes out of the restaurant's pocket, or they are "breaking ties" [who gets the nicer table for people who arrive at the same time], that is fine. if favoring A comes at B's expense, that's kinda lame ... yes i recognize in some cases B may not know, in some cases B will know, in some cases B may think he knows and it may be denied by the resto, and in other cases B may be wrong.

                                              I think the most common case of this is your 8pm RSVP is delayed and you dont know if they are "in the weeds" or you've been bumped. Let me think ... I think one such case was at ChaChaCha? ... a friend lived near by and ate there a few times a week and he'd be on an express queue. I think I got bumped at Charanga ... I am almost certain our table was given to a Friend of the House and we ended up with a wait and then 3 of us were put at a ridiculously small table for two. Sure a resto has the "right" to do that and you have a right to call them out on it, as long as you do so honestly.

                                        2. re: psb

                                          "i'm a little curious if any ethnic restaurants do any price discrimination"

                                          You're really all over the place, but anyway, in regards to your question, it's common knowledge there are ethnic places that have cheaper non-English menus, sometimes with different dishes. We shouldn't equate all VIP services like the OP's with "discrimination" or biased.

                                          1. re: sugartoof

                                            Price Discrimination is the standard term for this. It's not picked to be inflammatory.

                                            Yes, I know about the "chinese menu" with different dishes.

                                            I am talking about disparate treatment on price:
                                            http://en.wikipedia.org/wiki/Price_di...

                                            Or in my case, openness to tax fraud collusion, based on "identity".

                                            1. re: psb

                                              What?

                          3. This is so gauche The restaurants listed aren't even that in demand. I'd rather just contact a restaurant directly for a last minute reservation or plan ahead. Maybe if it was a really in demand place and I had a client that really wanted to go to a place I'd use it for them but for me personally just like I wouldn't use a bot to get a reservation, I wouldn't pay extra to get a table. I know it's not that different than a publicist calling a GM to get a table but it is really needed?

                            I am sure the same folks that are paying 4500 for a 1 bed near the Tenderloin will use it.

                            1. Have you people tried to "grease a host" recently? You talk so flippantly about it. It just doesn't work. A place booked and fully committed a week out simply won't take money to get a table. I've actually tried a couple of times in the last 12 months, just for fun. They won't do it for $100, not the places I tried.

                              Places are popular partially because of the price. It's a little weird, but why doesn't SBP raise prices? Their prices are very reasonable - because they'd like to be seen as a value, so they're leaving money on the table, as long as they can make a profit at their current price structure, they might be better off not raising prices. Raise prices, the word is out you're expensive, demand falls off too much, and you're in trouble. Saison had to raise its prices very slowly. Some places have done weekend pricing vs weekday (Atellier Crenn needs this, they have same-day during the week but weekends are booked 2-3 months in advance).

                              I know exactly why I want a reservation when I go out - because I don't want to be fogging around looking for my backup place, especially with guests in tow. When I'm out by myself - whatever, I can eat down the street.

                              So you have last minute guests. You _really_ want a reservation. You're going to pay $100/pp anyway, say, for a 4 top. You can't get into any of the restaurants that allow you to be a really cool host.

                              Would I pay an extra $50? To be sure of my reservation so I can tell my guests where to meet me?

                              ABSOLUTELY.

                              Is the restaurant list right or wrong? Hard to say, doesn't look good to me. Are there other reasons they'd fail? Sure. But morality --- really? We're going to debate morality in a city where you can spend $500/pp for dinner, with homeless people around?

                              5 Replies
                              1. re: bbulkow

                                You seem to be overlooking an important aspect... if the restaurant is so popular that you can't book a table several days in advance (let's adopt some suspension of disbelief here because none of the named restaurants could admittedly be considered such)... then what's to make it any easier to do so through this app if all they've done is taken a few tables out of rotation and allocated them to Table8? Surely such a popular place would be just as difficult to get a reservation to if the only criteria for reserving a seat is to pay a $20 fee... and compete with every other person in the city who wants a reservation for the same table! What seems quite obvious but has not yet been mentioned, is that there is no greater chance of securing a table through this app. The same number of tables are available as always... only a handful now cost $20 more. Unless the creators of this app have such little faith in it's success as to not consider this an issue due to the niche demographic that may or may not adopt it... you're still competing with everyone else in the city for a table at a very popular restaurant (suspension of disbelief!) that's impossible to get a last minute booking. It kind of exists in defiance with it's own purpose... designate a limited number of tables at premium charge and then assume that as a result of said charge, considerably fewer people will be interested (in both the app and reservation!) therefore making it easier for others to book. So they've purposefully created a tool which, in order for it to function effectively, must remain unpopular with the majority of San Franciscans. Otherwise, it will be just as difficult to book a table through Table8 as it will through any other means. Furthermore, even if the vast majority of local diners shun this app and chose not to use it, there will still surely be enough of a following to make the limited number of tables equally difficult to reserve... otherwise, it's essentially defeatist as anyone could bypass Table8 and get a res on their own. Which, upon coming back down to reality, happens to be the case for every single restaurant associated with it as of now.

                                1. re: bbulkow

                                  Btw, nobody is talking about morality... more like pretentiousness and lack of purpose.

                                  1. re: bbulkow

                                    You're right. Greasing a palm doesn't work if the place has reservations backed up for weeks for months, especially at places that charge your CC for a no show. It does work in places where you wait in line for an hour+, the no reservations places. There's not a lot of these places, and really who has problems getting reservations anywhere?

                                    I mean, seriously boo-f'-hoo, one has to go down their list or a list to the next nice restaurant in SF. The horror!!!

                                    Any way, this thing is personal preference but it's also a cultural shift. I think Americans like reservations to be reasonably level in appearance even if it's not reality. At least the super rich guy still has to have his assistant call those $$$$ 3-star places just like everyone else.

                                    $25 bucks is $25 bucks and no one is going to be grudge a place for trying to make a living. And if you want to pay it, no one is really going to get on your case. That said, seems a little bit like cuts in line and most people don't like that. I don't. I don't know if the word is fair or sporting but whatever. I can still see a use but I wouldn't want to use it on a regular basis.

                                    1. re: bbulkow

                                      I would not try to bribe a host but a simple phone call especially to a place you frequent often or whom you've made an effort to get to know the GM, head of servers can go a long way to getting an open table. Calling even a hour before and giving them my number if they have a cancellation has led to many a happy meal.

                                      1. re: bbulkow

                                        I think the entire "grease a host" thing has multiple components. One may be that the restaurant may have strict policies against it. The other may be the size of the restaurant. If a small place with 25 seats is sold out, there is probably not much that can be done no matter what. A larger place with 125 seats may have a bit more flexibility. Perhaps the constraining factor isn't even the physical seating capacity but the perceived ability of the kitchen to keep up with demand.

                                        I remember sitting at the bar at a fairly large and popular SF restaurant on a busy Friday night. A couple who lived in my building came in and asked for a table only to be told that the restaurant was completely booked for the night. They see me and come over to say hi. We chat and they tell me that they couldn't get a table. Since this was a place where I'm considered a "friend of the restaurant" I walk over to the hostess and tell her to give them a table. She immediately grabs two menus, walks over to the couple and goes "A table? Right away! Just follow me, please!" Problem solved.

                                      2. Anybody else ... U.R.M.I.? M.A.R.K.? ... amused over the ironic jargon ... the price charged under a PERFECT PRICE DISCRIMINATION REGIME is known as the RESERVATION PRICE?

                                        OLIVERB:
                                        In effect, this allows for PRICE DISCRIMINATION (see e.g.
                                        http://en.wikipedia.org/wiki/Price_di...), though I suppose you can argue it from a different angle too, depending on the details.

                                        I'd be sad to see this done with say Yosemite Camp Grounds or Grand Canyon Rafting slots ... and it seems dubious to have different TSA queues for people who pay $$$, but I suppose in the resto context, what they do here is their business.

                                        I'll be interested to see how this unfolds ... whether the startup merely provides the infrastructure or does the analysis to advise on strategy (how many table to hold back, how much to charge ... general demand modeling).

                                        While I'm sort of intellectually interested in this stuff ... price discrim, securitization, monetization, disintermediation ... and whatever the opposite of disintermediation is ... I think the "over-pecuniarization" of these kinds of interactions are kinda sad. There are some cases of real innovation and increased efficiency, but much of it at heart seems to be free riding on social norms, rather than being clever.

                                        1. It's a faulty concept. Restaurants aren't going to make enough off it to bother. It means losing control over a centralized booking point as well. Someone might figure out how to do this one day, but it's not going to be Table8.

                                          10 Replies
                                          1. re: sugartoof

                                            Honestly I think ultimately the really popular spots will move to the ticket system that Saison and Alinea have.

                                            1. re: sugartoof

                                              >Someone might figure out how to do this one day,
                                              >but it's not going to be Table8.
                                              >
                                              Well one ostensibly successful approach has been day-of-week pricing, e.g. at Chez Panisse:

                                              M: $65
                                              TWT: $85
                                              FS: $100

                                              So what used to be one good, a table at CP, is now three different goods with three different prices. A Tue Table != Sat Table.

                                              1. re: psb

                                                All for the same menu?

                                                At least the premium isn't put on the table, but the demand with tiered pricing. It's problematic to mark up your profits by such a huge percentage unless you're set up like CP, or Saison, making your own rules.

                                                1. re: sugartoof

                                                  The menus are not quite the same at Chez Panisse--Mondays ($65) are typically three courses, Tuesday through Thursday ($85) are four courses, and Friday/Saturday ($100) are four courses plus an aperitif.

                                                  Depending on how much value you give to the aperitif, or to an extra appetizer, you could argue that the more expensive menus are very slightly marked up per-course. But I think it's minor, and I think it's actually a pretty smart arrangement for a single-menu restaurant.

                                                  1. re: tripit

                                                    If the pricing corresponds to the number of dishes rather than a surchage for the day of the week, I think that's a very different thing.

                                                2. re: psb

                                                  Day of the week pricing still has a fairness to it as everyone has the same ability to access the reservation and everyone gets the same price for the day.

                                                  1. re: ML8000

                                                    Fairness is the whole separate issue. Senior discounts != student discount != ladies night != quantity discount != discount for locals, are secondary sales allowed etc.

                                                    1. re: psb

                                                      Yup, time to throw the old folks, students and women under the bus! No discount for you! BTW, is there an app for that?

                                                      1. re: ML8000

                                                        http://weblogs.sun-sentinel.com/news/...

                                                        1. re: psb

                                                          I would totally shave my legs for free drinks all night. They probably need to make it more embarrassing, like the high-heels night, or strappy sandal night, or halter top night... although that might just turn it into drag queen night...

                                              2. Some conjecture about why a restaurant would do this (though I'm admittedly unfamiliar with the San Francisco restaurant scene):

                                                1 - The restaurant is hoping to attract more customers. More specifically, it's hoping that a streamlined reservation process wherein a customer pays more to get guaranteed prime tables attracts people who wouldn't come to said restaurant normally. The restaurant is hoping that Table8 develops its own regular customer base, and that those customers who often choose where to go for dinner from Table8's offerings are then exposed to the restaurant in question when they might not have been otherwise.

                                                2 - The kind of people who don't mind paying an extra fee for a prime reservation are also the kind of people who might spend quite a bit on dinner and drinks. In this way, a restaurant might select more of a spendy customer base without raising its prices and otherwise hurting its demand.

                                                1. I, too, can see the concept extending to bidding. Imagine, if you will, an OpenTable-like platform that, once you've put in a time, date and table size for a restaurant, spits out both capacity and the current "booking fee" for those parameters. If the capacity for that time and group size hasn't yet been all taken up, making a booking requires no fee. The condition, though, is that no booking is confirmed -- at least not initially. If the spots are taken up, you have the option to put in a higher bid for one of the available spots by raising the booking fee, not unlike what you do on eBay. Let's assume some arbitrary cutoff time -- e.g., 24 hours before the stated reservation time -- upon which bids become final and the highest ones get the tables. You are essentially making the most popular times subject to market demand -- whoever is willing to pay the most for that table gets it, not whoever calls first.

                                                  12 Replies
                                                  1. re: pchang

                                                    No, this would not work, at least as it's constructed here. . The whole point of a reservation is to assure that a diner's party is able to dine at a particular restaurant at a particular time, and the Table8 system still allows for this. The bidding system completely removes this assurance, and turns the entire process into a giant gamble, where the diner is now at risk of not dining at that restaurant at all. Yes, a diner can always make a reservation somewhere else, but this assumes that restaurant choices are largely fungible quantities, which they are not. For instance, fine, if you lost your table at State Bird Provisions, that would be disappointing, but hey, you can always try again next week, and Nopa is nearby. On the other hand, if you're in the middle of your European vacation and your table at Noma gets swiped a day before your reservation, the second-best restaurant in Copenhagen probably isn't going to cut it; your vacation has been ruined. No one would tolerate this.

                                                    This problem would be compounded if more restaurants did this. Perhaps people will find themselves bidding for multiple tables, or perhaps they'll start emergency-bidding for another table, seconds after losing a previous table. In fact it's easy to imagine tables ballooning in cost on the last day, as losing bidders scramble to find somewhere else to eat the next day... which would evolve into all reservations being made as the result of frantic, same-day, open-ended bidding. I'd never get to eat anywhere, if they did this.

                                                    Moreover, it's very easy to imagine a scenario in which ultra-rich people abused this system to their favor. If Mark Zuckerberg impulsively felt like throwing a party at the French Laundry for the entire night, then all he has to do is outbid for every table for the entire night. Or maybe he's not sure when he feels like throwing his party, so he'll just outbid for every table for the entire week. Or the entire month. If the restaurant complains that all their tables are empty, well, hey, he's paying them all this money just for the reservations, right? A restaurant would really have to be making a ton of money this way for the chef to tolerate being turned into a personal cafeteria.

                                                    That said, I guess I'm basically just hoping that restaurants have better sense than this.

                                                    1. re: dunstable

                                                      That's why I allowed for some arbitrary 24 hour window -- to provide the certainty that you mention. I grant that some people would probably find this unworkable since the whole point of booking is to allow for planning in advance. But if not 24 hours, then maybe 2, or 3 days in advance. Whatever amount of time reasonably allows people to make alternative plans. Or -- and the choice is yours -- put in a sufficiently high bid that you believe no one would outbid you.

                                                      As for ultra-rich people abusing the system, well, that is a a risk as much with bidding as with Table8 as it currently works. The restaurants that participate do so knowing they risk alienating consumers. It's a perception issue, in some ways. Consider, for example, if SBP were to set aside 2 tables on Friday or Saturday and put them up for bid, as discussed. But, they say they have decided to donate the proceeds of the booking fee to charity. Does that change things?

                                                      Anyone who tried hard enough can book out an entire restaurant to themselves, now, and for free (call multiple times and pretend you are a whole bunch of different people, or create lots of OpenTable accounts; I suppose the reason we don't see this is because ultra-rich people find it easier to make arrangements with the restaurant directly if they want to book it out). Seems like it could be policed through limits on bidding if you were concerned about it.

                                                      I'm not for this concept, but somehow I doubt the group to which Table8 appeals would find it equally objectionable.

                                                      1. re: pchang

                                                        If there's a service available, I don't think we can portray it as abusing the system.

                                                        1. re: sugartoof

                                                          Semantics. Let us then instead call it "legally utilizing a service in a manner that is within their rights, but while royally enraging almost everyone else."

                                                        2. re: pchang

                                                          "But if not 24 hours, then maybe 2, or 3 days in advance. Whatever amount of time reasonably allows people to make alternative plans."

                                                          2 or 3 days would not cut it either, nor would a month, for that matter. The European holiday in the hypothetical situation I described is still ruined. It would have to be a sufficiently long enough time frame that any ancillary financial risks, such as the plane ticket, are null. It would have to be like six months or a year, and most restaurants don't reserve that far in advance.

                                                          "Or -- and the choice is yours -- put in a sufficiently high bid that you believe no one would outbid you."

                                                          I don't understand what you think this accomplishes. The obvious response by any counterbidder would be to do the same thing. If everyone does that... well, then you just have a standard auction. I'm guessing that you think people would attempt last-second surprise bids, as they sometimes do with eBay auctions, but this is primarily a tactic for bargain hunters trying to outsmart other bidders. This is the opposite situation -- our epicurean bidder is paying a premium for a service. They can eschew these tactics and throw enough money at it until they outbid you, long before the auction expires.

                                                          "As for ultra-rich people abusing the system, well, that is a a risk as much with bidding as with Table8 as it currently works."

                                                          No it's not. There is no dynamic pricing involved; when the reserving party forks over the $20, it's a done deal. The table is reserved. Yes, a successful restaurant can change the price of reserving tables, but what matters is that once the reservation is made, it cannot be taken away.

                                                          I'm not saying I'm a fan of Table8 either, mind you. But it is what it is; it's a consumer good and if people are willing to pay (I'm guessing they are, unfortunately), then the restaurant is free to charge. The bidding system is too variable; a person planning an important dinner would simply not bother with restaurants that used that system, because of the potential of a lost reservation.

                                                          "Anyone who tried hard enough can book out an entire restaurant to themselves, now, and for free."

                                                          I'm not sure what point you're making here either, since this is essentially what I was saying. Right now, if the ultra-rich person wants to reserve a table somewhere, that person will have to go through the same free process of reserving as the rest of us do (theoretically, anyway). With your system, that person can now throw money at the problem and make it -- and all competing diners -- go away.

                                                          "Seems like it could be policed through limits on bidding if you were concerned about it."

                                                          You offered your own solution to this problem: Rich Guy can simply have his friends or, more likely, his assistants make additional bids.

                                                          "I'm not for this concept, but somehow I doubt the group to which Table8 appeals would find it equally objectionable."

                                                          The variability problem exists for everyone, not just those who can afford $20. Even if we raise the price to $200, that is at least a fixed cost. There is no guarantee with open-ended bidding. College kids would lose auctions to middle-class couples, who would lose to millionaires, who would lose to billionaires, and so on. Even if I were an NBA All-Star or something, if I were planning a birthday dinner for someone, I would be wary of booking any restaurant that could snatched away by a billionaire -- probably not an impossibility in tech-heavy San Francisco.

                                                          1. re: dunstable

                                                            Yes, you are correct that the Europeans on holiday would not be able to guarantee a reservation under the circumstances described. I am not saying the bidding system would work for everyone -- it clearly wouldn't -- or that it does not have downsides, but that is not the same as saying it could not work. A restaurant or service could set the cutoff date however far out in advance that they think their business would allow -- a week, a month, etc. The French Laundry does this quite effectively 2 months ahead of the date of dining.

                                                            That European visitor who you describe could, if he really wanted that booking 6 months in advance, put in a very high maximum bid amount, substantially above the going-rate for booking fees (like on eBay, whenever a counterbidder put in his bid, the system would automatically raise the bid again on behalf of the visitor until the bid reached or exceeded his specified cap). That would make it very unlikely someone else could outbid him for a table in the intervening 6 months.

                                                            What a sufficiently high bid accomplishes is exactly that -- yes, it does not offer a 100% guarantee of booking, but it offers enough certainty that someone will be highly unlikely to outbid you, so as to effectively ensure you will be given the table. In some sense, no booking is 100% guaranteed. The host may have lost your reservation, a VIP might have bumped you, a follow-up request for confirmation may not have been received, a restaurant could close, etc. It is all a matter of probability.

                                                            I do not believe a bidding system is too variable. It is novel, yes, but not unworkable. And yes, there is no guarantee for open-ended bidding. You might always lose that table -- at least up to the cut-off date. But keep in mind we are not talking about a single table, but quite a few at any given time. Exactly how many rich people come out of the woodwork to trump bids, well, is perhaps a sign more of how much money certain restaurants have to leave on the table because of the status quo arrangements. And also, this system offers some advantages over Table8 in its current form, in that booking fees could be substantially lower than the fixed fee.

                                                            1. re: pchang

                                                              "That European visitor who you describe could, if he really wanted that booking 6 months in advance, put in a very high maximum bid amount, substantially above the going-rate for booking fees..."

                                                              "What a sufficiently high bid accomplishes is exactly that..."

                                                              No, I already explained why this would not work. There is no such thing as a "sufficiently high bid" if more than one person adopts this strategy, especially not in the Bay Area, with all its millionaires (unless you are yourself a millionaire, which I am not). If the "going rate" is X dollars and I bid X+10 dollars, there is no guarantee that someone will not bid X+20 dollars. It's not even better than 50/50. The problem is compounded since we're not operating in a blind auction: if you bid X+10 dollars, then everyone who bids less than X+10 dollars will know that you bid something more.

                                                              "And also, this system offers some advantages over Table8 in its current form, in that booking fees could be substantially lower than the fixed fee."

                                                              You're kidding, right? I'm not a millionaire, but I would happily pay $20 instead of jumping through all the hoops of getting a table at the French Laundry. I'd probably pay $100, in fact, and I'm not a rich guy. (Bbulkow above said he offered this much on a whim, so it's not just me.) I can easily imagine those fees soaring past $1000 per table, or even per person. (Although like others have said, I would not pay $20 for a table at any of the restaurants currently being offered.)

                                                              A good price analog here is the secondhand ticket market. Tickets for sold out events often cost double the face value of the ticket, which can be well more than $100. And a concert venue has thousands of seats, sometimes tens of thousands. A restaurant has perhaps a hundred, but only if it's very large. If they install this system at a place like Sukiyabashi Jiro, forget it; we may as well be trading in vintage claret.

                                                              I like that you've thought about this, though; it's an interesting idea.

                                                              1. re: dunstable

                                                                " I'd probably pay $100, in fact, and I'm not a rich guy."

                                                                But how often would you do it, and how many establishments are there in SF where it would even make sense? $100 represents a very nice meal in it's own right, at many highly rated restaurants.

                                                                It begs the question if you can create a model around servicing such a limited list of potential clients. It's also possible that given the infrastructure and other factors, we'll see more SF restaurants go ultra high end, into a private club or concierge model, geared strictly at people splurging on special occasions. Could those places survive if there were another dozen of them?

                                                                1. re: sugartoof

                                                                  Depends on the restaurant, I'd probably only do it once per restaurant. But if we lower it to $20 per table, I'm willing to pay that every weekend, if it meant I could pick my restaurant the day before. Yeah, I know, I'm part of the problem, blah blah, but I'm just being honest. For a popular restaurant, that service is totally worth $20.

                                                                  And again, I'm not a rich man. It's easy to imagine wealthier people paying $100 every week.

                                                                  1. re: sugartoof

                                                                    I believe you mean "raises the question" not "begs the question". Although "begs the question" is often used as you are doing, that use is exactly opposite the meaning of "begging the question".
                                                                    http://en.wikipedia.org/wiki/Begging_...

                                                                    I would consider using a service like that once a month or so, if it really could deliver cutting edge restaurants that I couldn't get a seat at, at prime times on weekends, with zero hassle (click-on-webpage). Or maybe once every two months.

                                                            2. re: pchang

                                                              Two years, ago, the restaurant Next in Chicago did make one seat per night available in a charity auction. Many people paid $5,000 for a two-top.

                                                              http://chicago.grubstreet.com/2012/02...

                                                              Next's business model is completely different from any restaurant in SF (pre-pay for a ticket to dinner, tickets are transferable but not refundable, no money changes hands at the time of the meal). Also, demand at the time Next did this was so great that months of tables were being booked within minutes, after being released on facebook at an arbitrary time during the day. So it's probably not directly applicable to Table8 or a similar system, but there is precedent for this model.

                                                              1. re: tripit

                                                                That was a Dutch auction. For the people who paid $5000, it was the same as buying a regular ticket.

                                                        3. This seems like a good deal for any restaurant that consistently turns away walk-ins at the relevant times. If Table8 sells a reservation, they get $10 pure profit on top of whatever the party spends.

                                                          I'm curious how last-minute they really are. Do they release the tables 15 minutes before? An hour?

                                                          2 Replies
                                                          1. re: Robert Lauriston

                                                            It's deeper than the walk-in issue. There are plenty of cases where I won't walk-in to a restaurant because of the uncertainty - even if they do have tables - and I don't know the restaurant well enough to know whether they usually have a 10 minute wait on 7:30 on a thursday when oracle world is - or is not - in town.

                                                            ( In a case where I want to dine at the last minute, I have a short list of 3 or 4 restaurants in the category and area I'm trying to eat, and will call them in the morning (or when the host shows up and does the morning's reminder calls) to see if a last minute table has come available, then, will call restaurants in the last 30 minutes and ask how long the walk in wait is. This is quite a bit of leg work. Remember, I started a thread a while ago about "favorite last minute restaurants" - places that have solid food but a liberal walk-in system)

                                                            Here's the problem as I see it:

                                                            Reservations have value.

                                                            Being able to reserve has value.

                                                            Getting a reservation (not just eating - reserving!) a popular restaurant in the last 24 or 48 hours has huge value.

                                                            Raising prices for everyone can't be done quickly (weekend by weekend), and sometimes has negative brand impact.

                                                            The internet allows viewing, bidding, sorting through prices quickly - more than calling up 20 restaurants and seeing what's available.

                                                            Currently, reservations are given away for free (sometimes a credit card hold). Holding a reservation at a popular restaurant can't be monetized. Restaurants are greatly hurt if someone doesn't show for a reservation. Our history with restaurants and reservations means diners get very emotional about changes in our current (very non-market) solution ( wow, there were a lot of raves about how terrible the ticket system was, in this discussion it seems more reasonable ).

                                                            Table8's trying to innovate. If it catches on, power will shift from those who can plan further in advance but have less money, to those who have more money and can't or won't plan farther in advance (a class of people who already has a lot of power). This kind of market-system has become - depending on where you sit - the frustratingly prevalent yuppies taking over the earth, or the spread of enlightenment where money gets its just deserts.

                                                            As a gambling man (when it comes to business), I don't like Table8's odds, but it could catch on.

                                                            ( If it does catch on, I'll probably benefit. I'll lose in cases where, today, I have inside knowledge about an area and can predict walk-in times, and I'll win in cases where my money buys me a seat at the table I would not have otherwise gotten. )

                                                            1. re: bbulkow

                                                              From the restaurant's point of view, the service as it exists today still seems like a good deal provided they always turn away walk-ins at the relevant times. Either you get an extra ten bucks pure profit or you seat the walk-ins who would have gotten the table anyway.

                                                          2. Does being available on Table8 make certain restaurants appear more exclusive to certain types of diners (who may not do deep research to check actual availability) and therefore more desirable to those who may value being able to say that they were able to eat at those kinds of places?

                                                            If so, it could function as a form of advertising which restaurants don't have to pay for.

                                                            1 Reply
                                                            1. re: FoodPopulist

                                                              Definitely.

                                                              It could also turn off some potential customers who will think "Oh, it's really hard to get a reservation there, look they're on Table8, let's just go somewhere else".

                                                            2. What gets me is, all this effort and demand for restaurant seats at the worst time of week. When the business is at its most crowded, its resources maximally stretched.

                                                              Folk I know who strive to get the most from restaurant experiences (I'd guess that fits many of this board's regulars too) take pains to avoid eating out on busy weekend nights, using those for entertaining at home, say. I've avoided Saturday-night restaurant dining for 20 years and if it must be then, we try for the least fashionable time, like 5PM.

                                                              30+ years ago (long before "Kitchen Confidential"), Jim Quinn summed up this situation in the title for his anthology book of behind-the-scenes US restaurant articles: "But Never Eat Out on a Saturday Night."

                                                              Obviously, there are other considerations besides "getting the most from" restaurant visits, so I guess that's where this new service's market lies.

                                                              5 Replies
                                                              1. re: eatzalot

                                                                In theory, this service is most practical for the kind of establishment that is always booked, and doesn't have a real weekday slow down.

                                                                1. re: sugartoof

                                                                  Agreed in principle, sugartoof. However I was commenting on the existing service as described in the OP's linked article:

                                                                  "partnered with 12 of SF's top restaurants to secure a handful of two- and four-tops during prime dining hours (Thursday-Saturday, 6:30-8:30pm)."

                                                                2. re: eatzalot

                                                                  Regrettably I, like many people, have variable evening hours at work - often starting searching for dinner at 9pm (thus my love of Fu Lam Mum, Gravity, Tacolicious). I find myself eating out on Friday and Saturday more often than I'd like --- and a service like this is best when I'm entertaining (unable to hop around with walk-in times), thus at the whim of other's schedules.

                                                                  At least on friday and saturday you get the "A team" when they are fired up and focused.

                                                                  1. re: bbulkow

                                                                    Yes indeed, entertaining (especially when you can't select the schedule) is what I had in mind among "other considerations" above.

                                                                    But the record of published expert observation over the last 40 years (Jim Quinn whom I mentioned is only one example) and countless individual restaurant-personnel remarks is that _given_ free choice of timing, the diner is better off at times, even if not ALL times, other than Fri or Sat nights. Yes, the "A Team" aren't always present (especially at restaurants open more than five nights a week), yet generally it is there more than just Fri and Sat. Part of this is my own observation as someone who tends to return many times to favorite places. But restaurateurs and cooks have often remarked that they'd rather spread out the demand over more nights rather than scramble to do justice to a horde on 1-2 nights and be under-utilized the rest of the week.

                                                                    I'm a semi- (or at least semi-demi-) regular at one high-end place that gets much praise, and over the years have picked up the pattern -- confirmed by restaurant personnel -- that people from elsewhere in the restaurant trade habitually choose to dine there Sunday nights. Most key staff are still on duty then (it's the last day of their working week), and the customers get, unavoidably, more time and individual attention, more opportunity for asking q's, meeting chef, touring facilities, etc. than they would on Fri or Sat (or even Thurs, which has emerged at that restaurant, anyway, as a night for business dinners and large parties).

                                                                    1. re: eatzalot

                                                                      My one stellar meal at Manresa was on a wednesday. All of my other meals there had their rocky moments.

                                                                      I eat out just about every night, so there's no question of whether to go out on friday & saturday, just where.

                                                                      The one counter example: sushi. So much of the japanese fish flow from tsukiji is organized around the freshest fish being Fri and Sat. For example, a sunday morning at Sushi Tomi and the (very nice looking) whiteboard was all sold out.

                                                                3. This platform really doesn't make any sense either from a consumer or investor perspective. First, the market is tiny. The application would appeal only to a very small group of diners who are willing to pay an additional $20 just for the privilege of dining at one of the dozen or so high-end restaurants that have enrolled in the program. How large could that demographic possibly be? It's limited to highly affluent diners who (1) know about the application; (2) feel some urgency to dine at the particular restaurants that are participating in the Table 8 program; and (3) are too lazy to just make a reservation at another nice restaurant on Open Table. That's a tiny market. Only restaurants that have extra capacity would participate. If they didn't have any excess capacity, why would they sell tables to Table 8? Also, how will this application scale? Only about a dozen restaurants use it. $20 per table, 2 tables per resto, five nights per week. 2 seatings per evening. that's, what: That's just $400 per week. Times 12 restaurants in program, that's just $4,800 per week. Try running a business in SF that requires marketing, tech support, etc. for that. You won't last very long.

                                                                  4 Replies
                                                                  1. re: Jamesbond007

                                                                    <<If they didn't have any excess capacity, why would they sell tables to Table 8?>>

                                                                    That's the entire point: there's extra money to be made precisely from the fact that demand for tables is SOMETIMES (but probably not always) way outstripping supply. If the average tab is, say, $100pp, moving a table to Table8 allows the restaurant to make $110pp or whatever on that table (before the Table8 kickback) without having to raise menu prices on everyone. Raising menu prices, if demand is softer at off-peak times, could lead to empty tables at those times as the marginal diner decides it isn't worth the money.

                                                                    As for scaling, isn't the whole idea of "scaling" that you, y'know, scale the concept? Only 12 restaurants in SF use this now, but maybe more will join, and it's virtually certain that Table8's business plan involves moving into NYC, LA, Miami, Chicago, etc. next. I agree that booking a couple of tables here and there at peak times, even when scaled across the whole US, might still not add up to much of a business, though. But maybe Table8 has some secondary business they're envisioning (like building a clean email marketing list of affluent techies that they can sell to other companies that sell stuff to affluent techies).

                                                                    1. re: bigwheel042

                                                                      Also I would be curious to see just how much market penetration OpenTable has gotten. At a typical $$$-$$$$ restaurant on 8pm Friday night, in a restaurant with 100 seats, how many of those 100 seats were booked with Opentable? 20? 40?

                                                                      What I'm getting at is: Opentable seems to have a viable business with booking some fraction of the reservable tables. Maybe Table8 will never get enough tables to be viable, but maybe the fraction needed to be viable is smaller than we think.

                                                                    2. re: Jamesbond007

                                                                      Well, no one said you had to invest, but let me point out about the market.

                                                                      Restaurants that are crowded have a large market. You can't yogi berra your way out of it and say the crowded restaurants are a small market because no one goes there.

                                                                      Today, people who dine at (some) crowded restaurants have go to through hoops and plan pretty far in advance - sometimes months. For people with enough money to dine at these crowded places, they often don't know their schedule well enough to plan months in advance.

                                                                      And remember that a _reservation_ is more valuable than simply having an empty seat at the last minute.

                                                                      I'm starting to consider getting a reservation almost every weekend, weeks in advance, at a few places, and cancelling them 99% of the time. Usually GF and I plan our weekend on Thursday, so I could cancel then. There's no loss to me in reserving a month in advance and cancelling a day in advance at restaurants I've never been able to get a res at (say, aziza, because getting there on the early side is hard from our house, and it hasn't come up on the late side yet).

                                                                      Raising full menu prices is highly imperfect. Some weekends might be crowded, some might be empty, you don't want to raise and lower menu prices on a moment by moment basis.

                                                                      Table8 has to establish their brand, likely through partnerships with the restaurants they serve. If you go to a place, like it, but know it's usually crowded and see the Table8 sign, you might install the app and try it out. This is basic brand transference - it's the good, high quality restaurants, Table8 gets to borrow some of the brand equity.

                                                                      I don't know why you're even bothering to debate. No one will force you to use it or not, they might succeed or not, how about just watching what happens instead of spending your time throwing rocks at people trying to build something new. The market will throw enough rocks without back seat drivers.

                                                                      1. re: bbulkow

                                                                        Be it said that when I ran into Yogi Berra at an adjacent table in a restaurant a few years ago, the restaurant actually was very crowded at the time.

                                                                    3. To secure your position on the Golgafrincham B-ark, you can now sell reservations via a company that has no connection whatsoever to a restaurant.

                                                                      If I understand their system correctly, the Seller get a reservation, posts it on the Site, and the Buyer pays money for it. I would assume the Site takes a cut. If a reservation isn't claimed within 4 hours, the Site calls the restaurant to cancel.

                                                                      It gives people an incentive for hoarding until hours before opening, and that's bad for consumers and the restaurant. There's also the issue that, if the Buyer is a no-show, the restaurant and Opentable lose potential revenue, but the Buyer and Site still make money. And it puts in jeopardy the account of any Seller who made the actual reservation on Opentable. That means lots of dummy Opentable accounts.

                                                                      http://sfist.com/2014/07/05/now_you_c...

                                                                      7 Replies
                                                                      1. re: hyperbowler

                                                                        If a reservation is hard enough to get that people will pay for it, the restaurant will probably have no trouble filling the seats.

                                                                        1. re: hyperbowler

                                                                          My understanding is that the site and the seller are one and the same — the creator of the site is the one making all of the reservations under various assumed names, then selling them off, at which time the buyer gets the fake name to use upon arrival at the restaurant.

                                                                          As many have pointed out, it's basically ticket scalping (or, at best, Ticketmaster) for restaurant reservations.

                                                                          1. re: abstractpoet

                                                                            The website has changed since I looked at it. Now it's directed at Restaurants, offering them a piece of the action and doesn't allow a random person to sell a reservation.

                                                                            Right now there's a reservation available for Pizzeria Delfina, which currently doesn't offer reservations. Either Delfina is joining up with him, or this guy's just a troll

                                                                            1. re: hyperbowler

                                                                              Hahaha, they're trying to sell restaurants something they already own?

                                                                              1. re: ML8000

                                                                                Yes-- sounds like extortion. The owner of Reservationhop will book tables under fake names, and keeps them off the market, with no guarantee the seats will ever be filled. But, should the restaurant want to, he can let them in on a piece of the action.

                                                                                This is different than Ticketmaster where the venue has been paid whether or not the scalper is successful at re-selling their tickets.

                                                                                1. re: hyperbowler

                                                                                  It makes little sense. Once a restaurant figures how to hack it, it's over. By hack I mean a simple way to figure out if reservationhop made the reservation. It might be as easy as requesting ID upon arrival, or a verification text. Once a paying customer (to reservationhop) gets rejected, the biz model is in serious trouble.

                                                                                  1. re: ML8000

                                                                                    They could require a credit card for reservations. Inconvenient and annoying, but it would give the higher end restaurants a good excuse for why they have to secure a reservation.