Flexibility in the face of caution

Inflation is a real challenge for restaurant owners. Raising prices on menu items isn’t a money grab; it’s a necessity for survival.

But it’s important to get it right.

The reality:

29% of restauranteurs have considered raising prices to weather a potential recession in 2023.

The good news:

88% of consumers agree that given the impact of inflation and the rising cost of goods, they would understand if their favorite local businesses raised their prices.

How much is enough?

Knowing how much to raise prices is a balance between what your business needs to sustain itself and what your customers are willing to pay. Customers are experiencing higher prices at the grocery store, and they understand that things cost more today.

3%

of consumers would be unwilling to bear any price increase.

55%

of consumers would bear a 1-10% increase.

30%

of consumers would bear an 11-25% increase.

9%

of consumers would bear a 26-50% increase.

3%

of consumers would still go to their favorite restaurant even if they increased prices 51-50%.

Caution:

On average, consumers are willing to tolerate up to a 17% price increase before they start to reconsider visiting their favorite restaurant.

3. Be transparent.

Let customers know why you’ve raised your prices. Your regulars are more likely to understand why their favorite menu items cost more.

1. Combat food waste.

Use technology to improve your operations. An inventory management system that helps you optimize your inventory levels can help prevent you from throwing away money.

2. Update your menu.

Instead of paying higher prices for items that aren’t readily available, alter your offerings to use in-season ingredients, which usually cost less.

Pro tips: