Ever wonder why that ribeye at Outback costs half what it would at a fancy steakhouse downtown? The answer isn’t what most people think. While many assume it’s all about portion sizes or service quality, the real reason comes down to what’s actually on your plate. Outback has mastered the art of serving decent steak at wallet-friendly prices, but there are some surprising trade-offs that most diners never realize they’re making.
They use choice beef instead of prime cuts
Walk into any high-end steakhouse and they’ll proudly tell you about their USDA Prime beef. This top-tier meat comes from younger cattle and has tons of marbling – those white streaks of fat that make steaks incredibly tender and juicy. Only about 5% of all beef in America gets the Prime grade, which explains why it costs so much. Prime steaks can easily run $50 or more at upscale restaurants.
Outback takes a different approach by using USDA Choice beef instead. Choice is still good quality meat with decent marbling, just not as much as Prime. The difference means your steak won’t be quite as buttery or tender, but it’s still perfectly edible and tasty. This single decision allows Outback to sell steaks for $20-30 instead of $50-80. The restaurant doesn’t advertise this grade difference, but it’s the main reason their prices stay so reasonable.
Well-done steaks get the worst cuts available
Here’s something most people don’t know: if you order your steak well-done, you’re getting the lowest quality meat Outback has in the kitchen that day. Former employees have revealed that the restaurant sorts its steaks by quality, with the best cuts going to customers who order medium-rare or medium. The logic makes sense from a business standpoint – why waste good marbling on a steak that will be cooked until it’s gray throughout?
This practice helps Outback keep costs down because they can use their premium Choice cuts more strategically. If you prefer your steak well-done, you might not notice the difference since the extended cooking time masks the meat quality anyway. However, if you want the best bang for your buck at Outback, stick to medium-rare or medium doneness to get their better cuts of beef.
Pasta dishes come pre-made and microwaved
Remember when Outback’s pasta dishes tasted fresher and more homemade? That’s because they used to be. Former employees report that until around 2016, the restaurant actually made pasta sauces on-site and combined them with freshly cooked noodles and proteins. The Kingsland Pasta and Queensland dishes were prepared to order, which took more time and labor but resulted in better taste and texture.
Now those same pasta dishes arrive pre-bagged and ready to microwave. The kitchen staff simply heats up the sauce and noodles together before adding your choice of protein on top. This change drastically cut labor costs and prep time, allowing Outback to keep pasta prices under $30. However, it also explains why many longtime customers notice the pasta doesn’t taste quite the same as it used to years ago.
Bloomin Onions rely on bulk purchasing power
That famous Bloomin Onion appetizer requires a very specific type of onion – they have to be massive, perfectly round, and firm enough to hold their shape when cut and fried. Regular onions from the grocery store won’t work. Outback needs special “colossal” onions that are much larger than what most people see in supermarkets. These specialty onions could be expensive if bought in small quantities.
The secret is volume. Outback sells over 8 million Bloomin Onions every year, which means they use more than 14 million pounds of these giant onions annually. The restaurant works directly with about 15 growers across Idaho, Oregon, Texas, and California to secure this massive supply. By ordering in such huge quantities, they get wholesale prices that allow them to sell each Bloomin Onion for around $12-13 instead of $20 or more.
Labor costs stay low with basic preparation
Making those Bloomin Onions used to be a nightmare for kitchen staff. When the appetizer first launched in 1988, employees had to cut each onion by hand, carefully slicing it into perfect sections while keeping it intact. This took forever and required real skill to get right. One onion could take several minutes to prepare properly, which created bottlenecks during busy dinner rushes.
Outback solved this problem with a device called the Gloria onion cutter. Now employees just peel the onion, place it in the machine, and push down. The device instantly cuts the onion into perfect sections and removes the core. The whole process takes seconds instead of minutes, and requires no special skills. This efficiency boost means one worker can prep way more Bloomin Onions per hour, keeping labor costs down and prices reasonable for customers.
Lobster tails get the microwave treatment
Ordering surf and turf at most restaurants means paying premium prices for expertly prepared lobster tails. The expectation is that a skilled chef will carefully cook the lobster to perfection, then brush it with garlic butter before serving. At Outback, you can get lobster tails for much less than other steakhouses, which seems like a great deal until you learn how they’re actually prepared.
Current and former employees have revealed that those lobster tails are simply microwaved in containers with water. There’s no careful cooking technique or chef expertise involved – just basic reheating in the microwave. While this method keeps costs down and allows Outback to offer affordable surf and turf options, it also explains why the lobster might not taste as good as what you’d get at a dedicated seafood restaurant that actually cooks their lobster properly.
Restaurant sizes are shrinking to cut overhead
The pandemic changed how people eat out, with more customers choosing takeout and delivery over dining in. Outback noticed this trend and decided to adapt by making their restaurants smaller. New locations are about 17% smaller than older ones, coming in around 5,000 square feet instead of the larger spaces they used to build. Smaller restaurants mean lower rent, utilities, and maintenance costs.
These smaller restaurants also have different layouts optimized for takeout orders. The bars have 30% less seating, and many four-person tables have been replaced with two-tops. There are dedicated pickup areas for delivery drivers and takeout customers. By reducing their real estate footprint and focusing on off-premise sales, Outback can keep their overhead costs lower, which helps them maintain competitive menu prices.
Menu engineering keeps profitable items prominent
Ever notice how Outback frequently reorganizes their menu and adds new deals? This isn’t just about keeping things fresh for customers. The restaurant constantly analyzes which items are most profitable and makes sure those dishes are easy to find and attractively priced. When they redesigned their menu in 2020, they organized steaks by cooking method and added free second sides to many entrees.
The chain also uses menu changes as opportunities to adjust prices strategically. They might lower the price of their Bloomin Onion by a dollar while quietly raising prices on less popular items. Steak upgrades are priced at just $2 to encourage customers to spend a little more. These small adjustments across the menu help Outback maximize profits on some items while using others as loss leaders to attract customers.
Quality rankings reflect the price differences
Food critics and customer surveys consistently rank Outback near the bottom when compared to other steakhouse chains. The restaurant came in last place in a recent ranking of the 11 most popular steakhouse chains in America. This isn’t necessarily surprising given the cost-cutting measures and lower-grade beef, but it confirms what many steak lovers already suspect – you really do get what you pay for.
The quality difference becomes obvious when you compare an Outback steak side-by-side with one from a higher-end steakhouse. The Choice grade beef simply doesn’t have the same richness, tenderness, or depth that comes with Prime cuts. However, for casual diners who want a decent steak without breaking the bank, Outback’s approach makes sense. The question is whether you prioritize saving money or getting the best possible steak experience.
Understanding why Outback’s steaks cost less helps you make better decisions about where to spend your dining dollars. If you’re celebrating a special occasion and want the best steak possible, save up for a restaurant that uses Prime beef. But if you just want a satisfying meal at a reasonable price, Outback’s Choice cuts and cost-cutting strategies deliver exactly what they promise – decent food without the premium price tag.
