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I'm currently organizing my wedding and it seems as soon as you mention the W word to any restaurant or caterer etc. the price immediately double. I'm not even kidding either - I've even gone to a restaurant who had banquets on their website for like $35 and they told me those wouldn't be available for a wedding and that the wedding ones start from $60+.

Can someone explain from an economic supply/demand type point of view why it is like this?

In any other situation, you would think it should be less per head to cater for a wedding than to just go to a restaurant. For one, there's massive economies of scale. I've been to weddings where it's a two/ three course meal with alternative dishes - so basically, they need to just cook two meals.

As opposed to if I just went to the restaurant, they would need to cook whatever dish I picked from the menu even if they weren't making this dish for anyone else.

There's other savings like the fact they know in advance the food they need to serve which I assume would help them optimize their costs, reduce wastage. They also have the guarantee that the restaurant will be packed out (most likely with happy guests not shy of taking advantage of a free bar tab) and know in advance how much they will be getting.

So is it just that the restaurants know that most ppl MUST have a wedding and they know that every other restaurant will ask a high price and therefore they can do it? Sort of like a cartel that inflates the prices? I find that hard to believe as there's many, many restaurants out there - and the cartel would break up easily as soon as one or two of the restaurants start lowering their prices.

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They know weddings will happen even if they jack up the price, you aren't going to postpone so they try to extract maximum. Then wedding arrangements and the ruckus created during and afterwards might be on their minds. –  DumbCoder Jan 6 '13 at 10:51
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Here's some advice, have absolutely no food at the wedding save a loaf of bread and some jam. Then announce that you gave $3000 in charity to feed hungry chidlren instead of spending it on the wedding. (Of course you actually give the charity you don't make up a story!) Start the revolution. –  user7969 Jan 6 '13 at 17:05
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In addition - the turnover is far faster for normal meals than for a wedding. In the time it would take to service the wedding party, the restaurant might serve 2 or 3 sets of customers. –  JoeTaxpayer Jan 6 '13 at 18:12
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@Raindrop - lol I'm sure though as soon as you mention it's a wedding, that loaf of bread will suddenly become special "wedding bread" and cost $25 per head. –  Joe.E Jan 7 '13 at 5:42
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The other factor is that almost all weddings happen on a Saturday, April-September - which means that in actual fact there is a lot of demand for wedding venues, and if you don't like their prices there will always be someone else willing to pay them. A really good way of cutting the cost is to hold your wedding during the week. You will suddenly find yourself being offered all sorts of discounts. –  DJClayworth Jan 8 '13 at 16:51
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1 Answer

There is the price they want and the price you pay. Everything is negotiable when its a service (always possible, but usually harder with actual "goods").

You should always haggle and price match your vendors. You can also try going to different vendors and not telling them its for a wedding and see if there really is a price difference. For example, call up a florist and say you need X, Y, and Z for a corporate banquet or for a special event for which you cannot give the details. If you then tell them its actually a wedding, and they blindly raise it without a good justification, move on.

That said, they jack up the price because they know most people will says "it's my wedding", "it's once in a lifetime", "it's MY special day", etc.... The same is true about diamonds, their price does not reflect the actual supply and demand ratio, just the perception that has been created. However, as mentioned in some of the comments above, the service provided at a wedding may be different or more involved than just a normal dinner

The more important issue is ensuring there are no back fees, no hidden fees, and you have well written, well reviewed contracts. For example, we know a couple whose caterer added a mandatory 20% gratuity, regardless of the service which was provided.

Most venues or restaurants will not be making the bar a lose-leader, but they will charge for other things.

You can also save money by buying used or looking on ebay for prices closer to wholesale for the product.

I think a good analogy to this is the Recent Time Magazine article on the price of healthcare - it costs a lot because its a small market and its harder to navigate, and most are not experienced shoppers in the area or don't have control over the individual item costs.

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