For as long as I can remember I've constantly seen the truism that restaurants operate on "razor sharp margins" repeated endlessly by the media, the restaurant industry, and the average joe. This seems to be something that people take for granted, yet there are and have been so many restaurants, many extraordinarily profitable and consistently so, and so little data ever presented to back up this truism when it is bandied about.
I've never seen any restauranteurs being open with their margins or disclosing how much they are losing or profiting from the business and the reasons for said profit/loss in a validatable & analytical way. Yet I always see this truism used to justify everything from paying employes $2 an hour and offloading their wages to the consumer, to exorbitant meal prices, and frankly its usage in making complaining about literally anything in the restaurant business seem legitimate. But when pressed, nobody ever backs it up with actual data. Does this data even exist or has this been an extremely effective guerrilla marketing ploy?
Why should I accept that the industry operates on thin margins? Why are they famously so much thinner than any other industry (or more loudly thin), and why is this so widely accepted as true? Has this truly been established from a data-based economic standpoint and if so does that data remain relevant year after year? If the answer is "yes" it has indeed been established, I ask for the how, when, where, and why--if only established once and not continually--it is relevant.
(pre-coronavirus economics only)