The anchoring effect is the tendency to let a negotiation be shaped by the first number that gets named, even when that number is arbitrary or one-sided — and of the seven negotiations an independent restaurant runs every year, it is almost always the other side that names it first.
The landlord's letter arrives with a new rent figure already on it. The supplier sends an updated price list. The insurer emails a renewal quote that is higher than last year's. In none of these three cases has the owner named a number first — and yet that one figure, set entirely by the other side, shapes the rest of the conversation. Not because it is correct, but because it came first.
An independent restaurant runs through roughly the same seven negotiations every year, more or less in this order: the lease renewal, the food and beverage supplier contracts, wage conversations with staff, the renewal of POS and software contracts, delivery-platform commission rates, the insurance policy, and — less regularly, but no less costly — equipment purchases and contractor or renovation quotes. In nearly all of them, the other side speaks first, and the owner reacts to their number instead of steering the conversation with one of their own.
This guide works through the seven, one at a time: what number typically becomes the anchor, why the owner rarely counters with a number of their own first, and the concrete fix for each. At the bottom sits a calculator that shows, for one negotiation of your choosing, what the anchoring effect could cost you — or win you, if you name the first number — with the assumption behind that model shown and adjustable, never hidden as settled fact.
This is not about negotiating harder. It is about recognising that most negotiations are already half-decided the moment the first number lands, and that you can have a say in which number that is. Everything below runs in your own browser: nothing is sent anywhere, nothing is stored.
Why the first number wins, even when it is pulled out of thin air
Tversky and Kahneman described in 1974 (Science, "Judgment under Uncertainty: Heuristics and Biases") how people form an estimate by starting from a reference point — an anchor — and adjusting away from it. The problem is that the starting point does not need to bear any relation to reality: in their best-known demonstration, participants first spun a wheel that produced a completely arbitrary number, and that number still pulled their subsequent, entirely unrelated estimate toward it. An anchor does not have to be credible to work. It only has to be said first.
Northcraft and Neale asked in 1987 what that means for people who ought to know better: experienced real-estate agents were shown the same house, with only the listing price on the information sheet varied between groups. Despite their own expertise, and despite some being explicitly told to ignore the listing price, their own appraisals still shifted systematically with that one figure on the sheet. Expertise does not protect against an anchor — it moves even the people who are trained to value the thing correctly.
Galinsky and Mussweiler examined in 2001 what happens once two sides are actually negotiating a price: whichever party names the first offer — buyer or seller — pulls the rest of the conversation toward it, and the other side almost always ends up responding inside the range that first offer left open. Research into how people adjust away from an anchor consistently finds that the adjustment falls short: people do move away from the first number, but not far enough to land on a fully independent estimate of their own. That is precisely the assumption the calculator further down makes visible and adjustable, rather than presenting it as settled fact.
The ultimate guide Restaurant Finances: 6 Numbers That Decide Your Profit Prime cost, cash flow, break-even, RevPASH and ROI — the whole financial system, in plain language. Open the guideThe 7 negotiations, and who names the first number
They are ordered the way a restaurant actually meets them across a year: from the lease that opens it to the investment that sometimes lands in the middle. Each section covers what number typically becomes the anchor, why the owner rarely counters it, and what to do about it.
1. Lease renewal: the landlord sends the first figure
A lease renewal rarely starts with a conversation. It starts with a letter or an email from the landlord with a new figure on it, often well above the old one. From that moment on, the owner is no longer negotiating "what is a fair rent for this space" — they are negotiating "how much of a discount can I get on their number", and that is a fundamentally different conversation with a different ending.
Owners rarely name a figure first, for three reasons that are each fixable: there is no ready comparison of rents per square metre for similar units nearby, it feels presumptuous for a tenant to propose a rent to the person who owns the building, and there is a vague sense that the landlord simply has the right to speak first.
The fix: before the conversation, gather comparable rents for similar units in the area — through an agent, through fellow operators, or from what recently sat empty and then let — and name a figure yourself when the conversation opens. If you do end up speaking second, reframe what you expected based on those comparisons before you counter; countering directly against their figure confirms it as the starting point, while reframing first pulls the conversation back to what is reasonable.
Two scenarios, the same negotiation. The outcome always lands between the anchor and the fair value — never on it, and never past it.
Their opening sits above the fair value. The outcome moves with it — in their direction.
Your opening sits below the fair value. This time the outcome moves in your direction instead.
Illustrative, not a measurement of any single negotiation — the pattern itself (the outcome lands between the anchor and the fair value, closer to the anchor than a fully independent estimate would) is what negotiation research repeatedly finds. The calculator further down makes the assumption behind that pattern visible and adjustable.
2. Supplier contracts: the price list is already their opening offer
A supplier's price list looks fixed and official — as though it were a tariff rather than a negotiating position. In practice it is exactly that: a written first offer, and most owners end up negotiating a "discount" off that list instead of starting from their own target price per item.
Why owners rarely name their own figure first: they rarely know their exact target price — that takes a per-dish costing exercise most kitchens do not keep up to date — and as a small, independent buyer they feel structurally weaker facing a large supplier.
The fix: work out beforehand what an item is allowed to cost within your own food-cost target, and — before the conversation, not after — get a quote from at least one alternative supplier, even if you have no intention of switching. That second figure is your own anchor. For the tactics that come after the opening figure — percentage discounts, payment terms, volume commitments, negotiating category by category — there is a dedicated guide: Restaurant Supplier Negotiation: 7 Tactics to Save 10-20%. That guide covers the tactic itself; this section covers why you rarely reach the tactic before their number has already shaped the conversation.
Illustrative, relative sizing for a typical independent venue — not your own figures. Put those into the calculator below.
Rent and supplier contracts are usually the largest annual lines, followed by wages; insurance and software carry less weight per negotiation but come around every year regardless. Equipment and renovation are irregular, but rarely small when they happen.
3. Wage negotiations: who proposes the first figure?
When hiring, it is often the candidate who names a salary expectation first — sometimes because the owner explicitly asks ("what are you looking for?"). In a raise conversation with existing staff it runs the other way: the employee names a figure, and the owner responds from a defensive position instead of an offer of their own.
Why the owner rarely opens with a figure: uncertainty about the exact market rate for the role, fear of offering too much to a candidate who would have accepted less, and — in a raise conversation — a reluctance to open the conversation at all.
The fix: know the market rate for the role before the conversation — through sector pay scales, job listings, or fellow operators — and name that range yourself when hiring, rather than asking what the candidate expects. In a raise conversation, decide beforehand what you consider fair given the role and the results, and raise it yourself instead of waiting for someone else to.
4. POS and software contracts: the "standard contract" is not law
A POS or software vendor typically sends a standard contract with a fixed monthly price and a fixed term, presented as though it were non-negotiable — much like a price tag on a shelf. Most owners sign it the same way they would accept a shelf price: without a counter-offer.
Why there is rarely a counter-anchor: software feels technical and opaque, and owners rarely have a comparable quote from a competing vendor in hand at the moment the contract is put in front of them.
The fix: before signing anything, get at least one quote from a comparable vendor, even if you are happy with what you have — that figure is your own anchor in the conversation ("we're looking at [alternative] at €X a month"). Negotiate the contract term as hard as the price: a shorter notice period is often easier for a vendor to grant than a price cut, and is worth just as much to you over time.
5. Delivery-platform commission: the standard rate is their opening, not the law
Delivery platforms display a fixed commission percentage on their website as though it were a price tag. In practice, venues with a larger volume, a longer history on the platform, or simply the willingness to ask, regularly negotiate a lower rate at renewal.
Why owners rarely negotiate it: the percentage is presented so officially that it reads as a fixed rate rather than an opening offer, and most owners simply do not know it moves at all.
The fix: ask explicitly for a lower rate at every renewal, using your own order volume through the platform as leverage. Compare beforehand what another platform — or your own delivery — would cost you, so you enter the conversation with a figure of your own instead of only reacting to theirs.
6. Insurance renewal: the quote is an opening, not a price
The insurer's renewal quote arrives automatically, often higher than the year before, and most owners pay it without a counter-offer — reading it as "the premium" rather than as an opening figure that invites a response.
Why there is rarely a counter-anchor: insurance feels technical and opaque, with policy terms few owners compare in detail, and most venues rarely request a second quote of their own accord.
The fix: request at least one comparative quote from another insurer every year, even if you have no intention of switching. That figure becomes your own anchor in the conversation with your current insurer, and it costs you nothing but the time to ask for it.
7. Equipment and renovation: the first quote is an opening bid, not a price
For an investment — a new combi oven, a dining-room refit, a new walk-in — the first quote from a contractor or supplier quickly becomes the anchor the whole conversation revolves around, even though that first quote is, statistically, often generously priced on the high side.
Why there is rarely a counter-anchor: this is a purchase you make rarely, so there is no built-up frame of reference, and it feels awkward to bid low on something technical you cannot fully judge yourself.
The fix: always get at least three quotes before the first real conversation, never one, and when you speak to the second and third, name the first quote's figure as your own reference point. Work out the financing side at the same time — a loan calculator shows in a few minutes what an investment costs per month at different amounts, so you walk in with a ceiling of your own instead of one set by whatever the first quote happened to be.
Work out what the anchoring effect costs you
Pick one of the seven negotiations, enter the annual value at stake, and say who names the first number. If they name it first, the calculator shows what could be left on the table. If you name it first, it shows what you stand to gain instead — the exact same model, only the direction flips.
The "pull" slider is the research assumption from above, made visible and adjustable: 50% by default, the midpoint negotiation research often finds for how far people adjust away from an anchor. That is a model, not a law — move it to whatever you find realistic for your own negotiations.
Anchor Impact Estimator
One negotiation, your own numbers, and the assumption behind the model shown and adjustable.
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Counter-tip: anchor near your own researched number before naming a range — a range anchors itself on whichever end favours the other side.
The model assumes an illustrative, per-type anchor gap (10–20%, not separately adjustable) between an unchallenged first number and a fair value, combined with the pull assumption you set above. It is a simplified model built to make the pattern in this guide concrete, not an exact forecast for your own negotiation. Everything runs in your browser; nothing is sent or stored.
Two things to keep in mind when reading your own result. The figure above is not a measurement of anything that actually happened at your venue — it is an illustration of how much a consistently used anchor can be worth, given the assumptions you set. Move the pull slider to whatever you find more realistic; the point is not the exact number, it is that the number is never zero as long as you let the other side always speak first.
And it runs in both directions. The same arithmetic that shows what an unchallenged anchor from the other side costs you also shows what a well-researched anchor of your own is worth — which is exactly why "who speaks first" is the question that opens each of the seven conversations above, not the one that closes it.
What to do this week, this quarter and this year
Preparing all seven negotiations at once is not realistic for anyone. This order works, because each step gets you ready for whichever conversation is already next on the calendar.
This week — lock in your own figure before the next conversation
- Check which of the seven negotiations is next on the calendar, and gather one reference figure for it today — a comparable rent, a quote from an alternative supplier, a market wage.
- Write that figure down before the conversation starts, not during it. An anchor invented on the spot is not an anchor, it is a reaction.
- Check your own yearly numbers against a cash-flow planner: whatever you consider "reasonable" in a rent or wage conversation still has to fit your own liquidity.
This quarter — do the homework for your two biggest lines
- Rent and supplier contracts are usually the heaviest annual costs (see the chart above) — start gathering comparison figures there, even before a conversation is scheduled.
- Revisit your prime cost: if you do not know what a supplier is allowed to cost within your own food-cost target, you cannot credibly name a figure first.
- Request a comparative quote for at least two of the seven negotiations, even where nothing is up for renewal yet. That figure costs nothing and becomes your own anchor at the next conversation.
This year — build a standing habit of counter-anchoring
- Add the seven negotiations to your yearly planning, noting when each recurs — a conversation you see coming gives you time to gather a figure beforehand instead of improvising one on the spot.
- If your venue is growing or considering an investment, revisit your financing plan in advance: a financing ceiling of your own is the strongest anchor you can set against a first quote.
- Writing a new plan? Fold these seven straight into your business plan — rent, supplier contracts and staff cost are exactly the figures a bank tests your plan against.
The first number wins not because it is right, but because it is first
Almost every owner recognises at least two or three of the seven negotiations above immediately — not because they negotiate poorly, but because nobody ever told them how much weight the first number in a conversation already carries. That is not a personal failing. It is one of the most thoroughly documented patterns in research on how people make decisions, and it moves experienced real-estate agents just as reliably as it moves an owner negotiating their rent for the first time.
The fix is not to push harder once the conversation has already started. It is to start earlier: have the figure ready before the other side speaks, so there is something to set against their anchor instead of having to work up from it. That is half an hour of homework per negotiation, not more.
Start with whichever negotiation is next on your calendar. Find one reference figure for it today, and use the calculator above to see what that one figure, applied consistently across the seven conversations you already run every year, could mean for your venue.