Opening a Chinese restaurant is also a brutal crash course in free-market economics.

In my little town of Laurel, MD (a northern suburb of Washington, DC), I could point you to eight Chinese restaurants within a three-mile radius of the town's center. I can also point you to the sites of four failed restaurants. Three of the failures were killed by location -- one was in the shopping center which is rapidly becoming the town's retail black hole, one was in a crumbling old strip mall which was condemned, and the last had the misfortune of sitting next to a Chuck E. Cheese. I can't tell you what happened to the last, as it's been shut down for longer than I can remember.

Though I can't speak from personal experience, as I don't run one, it's not hard to see that there's so little margin of error in running a Chinese restaurant. Unless you're the first one in town (virtually impossible these days in any town with a population over 2,500), your prices are already set by the competition. I challenge you to find, among your locale's Chinese restaurants, more than a dollar's worth of variation among the prices of, say, General Tso's Chicken and Moo Shu Beef, for a dinner serving. Egg rolls are a buck, a pint of fried rice will be about $2.95, and a weekday lunch special of egg roll, soup, and entree will be between $4.95 and $5.95. The only way to make a profit is to cut your expenses as much as possible and maximize your volume, since you certainly can't raise your prices.

And it's a fierce battle. Certainly, in one aspect, it's a big win for the consumer, since it usually boils down to just how much food you get for a given price. At the same time, quality sometimes suffers because of the corner-cutting involved in widening the profit margin -- it took my wife and me many moons indeed to discover which of the many restaurants in town had most of the things that we like done properly. It amazes me that so many of them can last through it all.

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