This comes from the Brooklyn Eagle newspaper:

“It is the custom with many saloon keepers to furnish their bars daily with a lunch bowl for customers. A German generally has a plate of pretzels and Limburger cheese ... the former thick with salt stimulates the appetite for drink. A Frenchman sets out French bread filled with caraway seeds and a bowl of garlic sliced in vinegar but an Englishman sticks to yellow cheese and crackers. ... The American saloonkeeper varies his bill of fare. Sometimes he runs to chowder then to bean soup He may have tripe and vinegar today but tomorrow he fancies raw onions in vinegar and army biscuits and ham sandwiches. Pepper and salt are used in unlimited quantities.”

George Ade from The Old Time Saloon:

“The average free lunch was no feast, but a stingy few edibles known to give customers an immediate desire for something to drink.

Dried Herring alias the Blind Robin a former fish imperfectly preserved in salt.

There were seasonal treats as well, spring onions or radishes when they were cheap, but as he reminded us “There was no closed season for dill pickles.”

The C in the Perreard's Cafe sign wasn't native to the "hippy-themed graphics" of the middle Sixties. Those designers were ripping off the French Art Nouveau movement, oh-so-new-and-fashionable here in 1901. (Think Alphonse Mucha.)

Below is the same view from June of 2016. The top of the Willard Hotel can be seen on the right side of the 1901 view but only the Willard's flagpole is visible in the 2016 view.

"Free" lunch, paid for the lunchtime crowd drinking overpriced beer.

My wife and I ordered a beer each and we were served, gratis, six delightful little dishes of stuff like frijoles, ceviche, tortilla. A place on the coast near Merida called Progreso.

They figured on selling enough beer to the patrons that a cheap lunch could be given away without hampering profitability. (Remember, they promised "free" and "hot" -- not a word about "good".) In fact, free lunch at saloons was something of a running gag in Crockett Johnson's Barnaby and Mr. O'Malley comic strip back around WW2.

Same concept is still alive (or was until fairly recently) in Las Vegas: you could get a fairly pleasant hotel room cheap, with restaurant meals surprisingly inexpensive. In fact, the room and food were operating at a loss in hopes of enticing the guests into the hotel casino -- which raked in enough money to cover everything.

I was a kid in the sixties (born in 1958), and the style of lettering on that café sign, especially the big languorous C, reminds me of hippy-themed graphics, a bit artsy-craftsy, just before the more explosive and mind-blowing style of psychedelia.

Lunchtime is always a slow time at any bar. No surprise that barkeeps would offer cheap food for the price of an alcoholic drink to drum up business. Although I’m sure work after that suffered a bit. Not sure when the “happy hour” phenom took place -- I’m thinking the 1970s? -- but in New Orleans it was common for neighborhood dives to offer red beans and rice to paying customers from 5 to 6 to get them drinking after work instead of going home. It could get quite lively, as I recall. I believe MADD took care of this practice, and for good reason.

Who or what paid for that? Because even in 1901 there was no such thing as a free lunch. Maybe they overcharged for that beer?