August 23, 2014

Hot Dog Micro Economy in New York

Posted on December 6, 2008 by in Business, sales

NY Hot Dog

In New York City, there are a bunch of hot dog stores with the word “Papaya” in the name. From what I can tell, these hot dog stands, that also sell tropical drinks, started when G.I.s returned to New York from the South Pacific after world war II. The ones that survived are almost always near busy subway stops on busy corners were there is ample foot traffic. People from the city know all about these places, and perhaps the most notorious is the Gray’s Papaya on 72nd and Amsterdam, which is more famous for it’s “recession special” — two dogs and a drink for $2 (or whatever the going rate) — than it is for being embedded in popular culture entertainment like Die Hard or Sex and The City episodes.  This recession special was probably started in some recession in the 50′s — who knows — but you can get the recession special even in boom times. And people do — there is almost always a line at Gray’s where people ask for “Two with Kraut” or “One plain, One with Relish”. They sell the cheapest dogs in town and make it on volume. Way over on 86th and 3rd, there is Papaya King where dogs go for more like $3.25 for two, instead of $2.50 for two. Papaya King appeared in the Seinfeld episode where Kramer leaves the movie theater to get a hot dog (and also is right across the street from the building where The Jefferson’s “moved on up” to, the building seen in the when they get out of the cab at the end and enter.) Once I was in Papaya King standing in line and a tourist asked how much the hot dogs were. You could tell he was a tourist because he was dressed sort of as if he was going on a hike in Yosemite and people from New York City don’t wear things like Gortex or sweat pants unless they’re actually going skiing or to the gym. But anyway, he wanted to know how much the hot dogs were and when the guy said they were $1.86. The tourist, wanting to show that he was street smart and certainly threatening the vendor with the potential loss of a good customer, said said “but they’re only $1.25 at Grey’s Papaya”. So the vendor said “well, why don’t you go over there and buy them” and a loud deep voice burst out in laughter, which prompted everybody else in line to laugh too because we all knew that there is well over a mile of city between Papaya King on 86th and 3rd and Gray’s Papaya on 72nd and Broadway. Any way to try to get there it will take at least 1/2 an hour to walk there at a fast pace, or 20 minutes in a $2 bus ride, or 15 minutes in an $8 cab ride — all those costs would far exceed your $.50 cent savings per dog. The tourist, who probably thought Gray’s was virtually next door, walked out in a huff.  Maybe where he’s from it’s worth it to walk two miles to save a dollar but that makes no sense in New York City. That’s (on of the reasons) why Papaya King can make it for 70 years while Gray’s is selling cheaper dogs on the other side of town.

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