Menu prices must go up to fundamentally change how workers are paid, says San Francisco restaurateur David Nayfeld

Restaurants should prepare for “new millenia of pricing,” argues David Nayfeld, owner of San Francisco’s Che Fico and Che Fico Alimentari.

After surviving the pandemic primarily with to-go and pantry offerings through Che Fico Alimentari, Nayfeld is now planning the reopening of his primary concept Che Fico to dine-in customers. And the operator is convinced that restaurants everywhere — not just in San Francisco — are going to have to raise menu prices and rethink how they pay their workers to fundamentally change the equation for profitability.

“Prices need to go up across the board throughout the entire industry,” said Nayfeld in an interview with Restaurant Hospitality. “I think that if we want to obtain better members of our teams, we should be paying more across our industry.”

When the sister concepts, which share a building, reopen fully, Nayfeld said he is planning to institute a surcharge: 10% for dining in the restaurants, and 6.5% surcharge for to-go orders. The additional costs will help the restaurants better balance wages between the front and back of the house and offer benefits that will attract the right workers, he said. Profit sharing is also coming this year.

“Because, look, at the end of the day, the proof is in the pudding. Who are you attracting at this pay scale versus this pay scale, right?” he said. “And if we want to attract more professionals and people who view this as a long-term career path, we should start paying them more, giving them better upward mobility and paths to partnership … and better benefits and better retirement plans and better, you know, maternity leave and paternity leave.”

Che Fico is not eliminating tips, however. “We wanted to leave guests the ability to tip,” he said. “Even if that tip percentage became smaller.”

Some measure of tip sharing will be instituted and wage increase for back of the house will attempt to address the disparity between tipped and non-tipped workers, he said.

Nayfeld reportedly spent four years at Eleven Madison Park in New York City and a year in Europe before opening Che Fico in 2018. The casual Italian concept was a hot ticket before COVID forced the shutdown on March 14, 2020.

Listen to Nayfeld explain his thinking about menu pricing.

UPDATE: This story has been updated with new information about the amount of the to-go surcharge.