Watch CBS News

Good Question: Why Are Restaurant Steaks Expensive?

By Jason DeRusha, WCCO-TV

MINNEAPOLIS (WCCO) -- This week before Thanksgiving, a lot of us like to go out to dinner, especially since we'll be cooking that huge meal on Sunday.

There's nothing quite like a juicy restaurant steak, the most decadent thing on many menus. But Sandy in Eagan wanted to know: Why is restaurant steak so expensive?

For a lot of us, restaurant steaks are about celebrating -- the closed deal, the new job, the anniversary. But there's not a lot of celebrating when we get the credit card bill.

Take Manny's in Minneapolis, for instance, where stakes run in the neighborhood of $50.

"You're paying for the highest quality meat," explained Josh Hill, executive chef at Manny's. "(Ours is) a proprietary blend, exclusively for us. You can't get this anywhere in the world."

One beef cow might provide 20 bone-in ribeyes, but the Manny's cut only yields four pieces from the very middle.

And that's not the end of it. The steak is then dry-aged for 30 days, which costs money. And then add in overhead downtown cost for the restaurant's staff.

"It's comparable to other steak houses around the country," said Hill. "This is a world-class steakhouse, and the price reflects that."

WCCO also checked in with The Strip Club Meats and Fish over in St. Paul, where a nice cut will run about $32.

Owner Tim Niver said his meat is grass-fed beef from Cannon Falls, Minn.

"You have somebody back there cutting meat for four hours a day. That's a lot of steaks to cover," said Niver, who said that the actual price of the food itself usually hovers around the 30 percent range.

Meat is graded by the U.S. Department of Agriculture. Only 2 percent of beef is rated USDA Prime. It's the marbling that gives it flavor, and it's why high-end steakhouses sell this stuff. Most grocery stores sell Choice, which is fine, but not the best.

Though the costs for beef fluctuate throughout the year, most restaurants tend to set a fixed price to absorb the market vacillations.

Also, the markup on steak is not as significant as the markup on wine, which is where a lot of higher-end dining establishments make much of their money.

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.