Adaptability to ensure longevity

Restaurants are feeling the impact of inflation and the rising cost of goods. Increasing your prices can help alleviate this. But, taking a considered, transparent approach is essential to retaining your regulars.

The reality:

29% of restaurateurs are considering raising prices in the next year to weather economic headwinds.

The good news:

83% of consumers say they would understand if their favourite restaurant increased their prices.

How much is enough?

Consumers are experiencing price increases in many aspects of everyday life and understand that restaurants are facing them too. Raising your prices is a fine balancing act between what your business needs to remain profitable and what is reasonable to diners.

8.6%

is the average price increase consumers are willing to bear.

18%

would be willing to bear an 11% to 25% increase.

67%

expect fees or surcharges to appear on their bills. With top expected surcharges including public holiday surcharges (45%) and credit card surcharges (37%).

33%

of hospitality workers have cited that customers have been remarking on price increases more in the past year.

5%

of consumers would still visit their favourite restaurant if they increased prices above 25%.

“We generally communicate price increases to customers at the point of sale and through their interactions with staff. The staff are well aware of why prices have been raised and generally we find customers are accepting where the rises are reasonable and can be explained.”

- Julian V Cincotta, Co-owner Butter

"Adapting to economic challenges is a top priority for us at Fricken. To navigate these challenges successfully, we've taken proactive measures to optimise our costs and enhance decision-making. We've implemented AI-based software that identifies supplier price fluctuations based on invoices, enabling us to make informed decisions promptly.

Whether it's negotiating prices or seeking alternative suppliers for the same product, this approach helps us maintain cost-efficiency without compromising on the quality of our food and service."

- Mo, owner Fricken

Pro tips:

1. Communicate increases

Tell diners when you’ll be increasing prices and why. Preparing staff on how to answer customer queries about the price changes honestly and posting about the upcoming changes on social media channels can help too.

2. Update your menu

With the cost of ingredients increasing, a refreshed menu can help keep costs down and entice new customers. Consider seasonally led options, new dishes alongside old favourites and even cutting back your menu. With Square for Restaurants, you can monitor the performance of your products in real-time, allowing you to evaluate in detail what is working and what isn't. From there, you can swiftly modify your menu in a matter of seconds, ensuring updates are synchronised across all locations and devices.

3. Ensure continuity across channels

Dodge disgruntled diners by checking your menu and price changes are updated across all your locations and channels. Like your website, in-house and across any food delivery apps used like Deliverect, Doshii or Cuboh.

Cocktail bar, RE is innovating their menu by taking ten of the highest waste-generating foods and transforming them into menu items.

“I believe limiting your views to one thing actually makes you more creative. Globally there are different things wasted in different parts of the world. Rice is wasted a lot more in Asia and in tropical countries, bananas are wasted. So we wanted to highlight the ten most wasted food items in the world and then find ten unique ways to utilise those ingredients and release the recipes as a resource for everyone.

We set out to be as zero waste as possible – that hasn’t changed. But, how we get to that point has changed. We’ve challenged ourselves to not generate any waste before it comes into the venue. That is the biggest decision we’ve ever made."

The mission doesn’t stop at food. Everything you taste or touch at RE has been reused, recycled or supports their mission – including their business tools.

“We use Square KDS everywhere so we don’t generate any paper waste. We use reporting to analyse everything in terms of what’s selling and what’s not selling to figure out how we can be more sustainable in terms of our portion sizes, what’s being wasted and what’s not being wasted. It’s integral to what we do.”

- Matt Whiley, Owner, RE

Creating a workplace culture that makes your team feel valued and supported is key to retaining them. Particularly in an era of staff shortages. Stable employment, flexible hours, employee benefits and a culture of working smarter are what hospitality workers seek in their workplaces.

31% of hospitality workers say that the restaurant being open to adopting new technologies that improve day-to-day operations would incentivise them to continue working at a restaurant.
52% value flexible working hours.

57% value job security (49%) and transparent values (23%).
47% value employee perks and benefits.

Pro tip:

Staff communication, simplified.

Centralise and simplify communicating with your team with Square Team Management. Staff will love having fast access to all the important stuff like rosters and shif ts. Plus, being able to sign in and out, request leave and share their availability through one easy-to-use app.

58% of consumers look for new restaurants or cafes through recommendations from friends and family.

42%

find new restaurants and cafes through Instagram (22%), Facebook (26%) and TikTok (16%).

41%

of restaurateurs plan to invest in marketing/branding in the next year.

Pro tips:

1. Work with content creators

Teaming up with content creators, like food bloggers and social media influencers, can help grow awareness of your business and introduce it to new potential customers. Seek out creators who align with your offering and values for the best results.

2. Reward your regulars

Thank your customers for their support and encourage repeat business with Square Loyalty. Reward your regulars with points for every purchase that can be used towards future transactions.

3. Invest in email marketing software

Connect with your customers on a more personal level with email marketing and keep your business top-of-mind with Square Marketing.