Saturday, 12 November 2011

LBYM : Dining out, A Luxury? In India !!

If there is one thing that I like to splurge on, it is food.  Both my wife and I like to sample different cuisines, and between us we have a wide range of foods that we enjoy dining on.  However, one constant source of disagreement that comes up at home is regarding how often we get to eat out.  I think we don't eat out often enough, while my wife feels that eating out is too expensive and she'd rather experiment with home cooking to expand her already wide portfolio of tasty recipes.  I usually disagree, and feel that it is too much effort to slave away in the kitchen day in and day out, and eating out twice or even thrice a week is completely justified.  Given that my wife works as well, I think it is only fair that we reduce as much work at home, while spending on something that we both enjoy, i.e. dining out.  Something happened this Friday though, that has made me re-think my stance on how often we should be going out to fancy lunches and dinners.

I have always thought that eating out in restaurants is not very expensive in India, when compared to elsewhere in the world.  Of course, if you choose to go to the fanciest of hotels that is rated 5-stars, a dinner for two can get to be very expensive, but these would be reserved for the choicest of occasions and hopefully rather infrequent.  I am talking about a casual lunch for two in a relatively nice restaurant, with a comfortable ambiance, tasty food, and overall an excellent way to spend a couple of mid-day hours.  In the US, a lunch for two could easily cost upto US$30, comprising of a starter, a couple of entrees, and maybe a shared dessert, or a couple of (non-alcoholic) drinks.  That's about Rs1500 which is a lot of money in the Indian context.  Typically eating out in India is no where near that expensive.  So I convinced Mrs.B this Friday to take some time off from work, to grab lunch at a restaurant that we both like, but hadn't visited in a while.  We got an auto, and were at the restaurant within 15mins at the stroke of noon.  We were early for lunch (by Indian standards) and so the restaurant wasn't even half full.  We got our choice of seats, and asked for the menu.  The first surprise that came our way was that the restaurant did not offer a-la-carte, off the menu orders for lunch.  The only option was the lunch buffet priced at Rs275 per person.  The buffet spread looked inviting, with a good mix of vegetarian and non-vegetarian dishes.  My wife liked the mixed vegetable tikkis, while I binged on the chicken wings.  The noodle soup was also pretty good.  They had a live chaat counter that was too good to pass on, so we took a mixed plate of dahi-puri and pani-puri.  For the main course, both of us liked the red thai curry with plain rice.  The dum-aloo and dal makhani looked very rich, so we just tasted a little.  The chicken hariyali was perfectly spiced and so was the amritsari machli.  After such a heavy lunch, we barely had room for dessert.  Mrs.B settled for the fresh fruit on offer, with a plate full of watermelon and pineapple.  I managed to put down a brownie with some strawberry icecream.  The service was fair, and we got to spend a good couple of hours enjoying the meal, and each others company.  All in all, a delicious lunch that was well worth every penny.

So I was cleaning out my wallet this morning, and I took a closer look at the bill that we'd paid for the lunch yesterday afternoon, that got me thinking about how much the lunch really cost us.  We took an auto to the restaurant that cost Rs27 and one on the way back for Rs31.  The buffet cost Rs275 a piece, with a 14% VAT tax, and 10% service charge.  Now of course we are paying for all of this with our after tax rupees, so there is that additional income tax burden to consider.  Putting it all together, here is what the final cost comes out to:

I have added up all the components that the lunch cost us, including the income tax that we have paid being in the 30% tax bracket.  It is easier to understand this data in a graphical format.  See the pie chart below which shows the same information as above in percentage terms. 
The surprising learning for me, was that only ~50% of our total spending went towards the actual lunch.  The remaining 50% went towards paying the government, the waiters and the auto-wallah.  Now I am not grudging paying the auto-guy and the waiters since they are providing a service.  The government on the other hand takes a huge 37% chunk out of my lunch spending for limited returns.  The double taxation on my hard earned rupees in the form of VAT (double cos I have already paid income tax while earning the money, and now have to pay VAT while spending it!) is particularly painful.  Here I haven't even accounted for the fact that the restaurant is also making a profit on my lunch spending, and the 52% that is attributed to lunch above, in reality is shared by the restaurant as profits, and my own value for lunch. 

Maybe Mrs.B has been right all along about cutting down on eating outside in restaurants.  I need to pick up a recipe or two to try out on my own at home.  This has definitely been eye opening for me; what do you think?


  1. Man, which restaurant do you go to? :-O! Oh my God! What a bill amount! I dine out for the very reasons you say but my bill doesn't come to that much!

    Personally (my opinion alone, so don't kill me), I also feel you overdid the items/portions. That's way too much for two people.

    ERE Jacob says he sometimes eats a few bowls of cereals before going to a restaurant to reduce the portion and items tha they eat. You could go the fruit technique (eat a few fruits before going to a hotel)

    I also find out the better restaurants near my house, so it is not such a big deal. If there is a "treat" necessity, I club grocery or other such shopping trip with the dining route to spread the auto/petrol expenses.

    But, overall, having tracked hotel bills in the last few years, eating out is somewhat tracking inflation and prices are going up. Not too much, but enough to make me take notice.

  2. You have a good perspective that you describe above. Mine is a little different, which should hopefully explain our actions.

    For starters, we were at a lunch buffet, so the number of items/portions is kinda irrelevant. This was a all-you-can-eat kinda spread, and a pretty good one at that!

    I dont always agree with ERE Jacob (for example, once I FIRE, I dont think I would go back to working like ERE Jacob) and this is one such instance. If eating at a restaurant became too expensive, I would eat there less often, rather than as often but eat less! In other words, there are some like ERE Jacob, who may prefer eating only starters at a restaurant, or fill-up on cereal at home, and split a plate of plain rice in the restaurant. I'd rather go less often to the restaurant, but once there, eat just like I normally would. It is just a matter of different philosophies to achieve the same result.

  3. In USA, is USD 30 only for the comparable Rs 275? so u wud have to add in all the other costs there also.
    The post 30% tax part is inclusive for all the groceries that you buy, the electricity/ gas that you use etc... so probably u shud put the 30% on the VAT, ST and the profit margin which is difficult to estimate.
    But I completely agree, also for Rs 275 per person, I think u got a good deal. Think about it if you were to go to a normal udipi restuarant, you would have spent far higher on the non food items! ( assuming u spent <275 per person)

    Good article and a different approach....