{"id":5614,"date":"2022-03-30T20:44:00","date_gmt":"2022-03-31T01:44:00","guid":{"rendered":"https:\/\/live-gordon-food-service.pantheonsite.io\/how-adjust-and-adapt-your-restaurant-menu-combat-inflation\/"},"modified":"2023-02-01T14:14:52","modified_gmt":"2023-02-01T20:14:52","slug":"how-adjust-and-adapt-your-restaurant-menu-combat-inflation","status":"publish","type":"post","link":"https:\/\/gfs.com\/en-us\/ideas\/how-adjust-and-adapt-your-restaurant-menu-combat-inflation\/","title":{"rendered":"How to adjust and adapt your restaurant menu to combat inflation"},"content":{"rendered":"

This article was originally posted on BackofHouse.io<\/a>. Visit them for more restaurant industry insights and solutions.<\/em><\/p>\n

Restaurant operators nationwide are facing surging inflation, with food prices continuing to rise. Experts say that supply chain disruptions are one of the key factors driving up<\/a> production costs, and, unfortunately, it\u2019s unlikely the issue will be resolved any time soon.<\/p>\n

To combat the rising costs, increasing menu prices is often inevitable. But there are other tactics you can take, too. We look at some ways to offset inflation, along with best practices when it comes to upping the costs for your customers.<\/p>\n

Raise menu prices, strategically<\/h3>\n

Among the most obvious ways to deal with inflation is to raise menu prices. But for this to be successful, it\u2019s rarely as simple as adding a few dollars across the board.<\/p>\n

\u201cYou can\u2019t just blindly raise prices \u2013 if you don\u2019t do it the right way, you\u2019re not only going to impact your customers, but you could negatively affect your business,\u201d says Josh Sharkey, founder and CEO of recipe software company Meez<\/a>. \u201cYou have to look at the velocity of sales of different items, which ones have the best economics for you internally, and see where the wiggle room is.\u201d<\/p>\n

Using data to make small changes can have a huge impact on your profit. Start by assessing your menu mix. And then consider small price raises on your top items. \u201cCustomers are becoming more understanding of the impact of the economy on the food they\u2019re eating, and if something\u2019s the most popular item and you slightly raise the price, you\u2019re not likely to see much attrition from that,\u201d says Sharkey.<\/p>\n

The key is to make incremental raises over an extended period of time. Inflation and food prices are putting pressure on not just operators, but customers, too. The Consumer Price Index rose seven percent in the year through December, and the price of food grew 6.3 percent. It\u2019s a fine line between raising prices and losing customers, and any large menu hikes aren\u2019t likely to go unnoticed.<\/p>\n

\u201cA good rule of thumb \u2013 spread the pricing impact you want to achieve over two to four pricing rounds per year,\u201d says Richard Delvall\u00e9e, senior vice president of consulting services of Revenue Management Solutions. \u201cGenerally, RMS recommends keeping increases at or below 1.5- to 2-percent within each round.\u201d<\/p>\n

After raising your prices, closely monitor how this impacts your customers\u2019 behavior. If it hasn\u2019t changed, this indicates there\u2019s room for further opportunities moving forward. \u201cOn the other hand, if you raise prices and begin to see significant changes in purchase behavior, you should take a hard look at the data and quickly understand what corrections you need to make,\u201d says Delvall\u00e9e. <\/p>\n

Add a surcharge to tickets<\/h3>\n

Some restaurants are forgoing menu price hikes in favor of adding a universal surcharge, ranging everywhere from three- to 15-percent on every ticket. While this involves less menu analysis, it requires more upfront consumer education. Transparency is important to avoid sticker shock when customers receive the check. Use this as an opportunity to give insight into the challenges your restaurant\u2019s facing. <\/p>\n

\u201cOut of necessity during these hard times, we will be implementing a 15-percent inflation charge on all tickets,\u201d said Court Street Grille of Lincolnton, North Carolina in a note to customers<\/a>, who went this route last November. \u201cWe ask for your patience as we manage through global supply chain issues, increased food, labor, freight, and shipping costs.\u201d<\/p>\n

If worried about the impact a surcharge could have on parts of your customer base, consider making it optional. In December, restaurant group Founding Farmers<\/a> issued a five-percent surcharge, which they\u2019ve framed as a \u201crestaurant recovery charge\u201d, that can be removed if guests raise concerns. Co-owners Michael Vucurevich and Dan Simons say they opted to use a surcharge because it\u2019s easier to adjust to meet the volatile conditions of the pandemic. If you\u2019re not utilizing a QR code menu <\/a>that\u2019s easy to adapt, you may want to opt for this option, too.<\/p>\n

\u201cRather than raising and lowering prices, potentially multiple times as pandemic-impacts ebb and flow, the use of a fee allows our prices to stay the same, and the fee can come and go,\u201d wrote Vucurevich and Simons in a statement on Founding Farmers\u2019 website. \u201cIn addition, the administration of a price change in a restaurant is real work, and many restaurants have less office and administrative support than ever. To change every single menu item price in the database and reprint our menus only to potentially change it back is additional cost avoided by using a fee.\u201d<\/p>\n

Engineer your menu to minimize waste<\/h3>\n

Restaurants across the country are tightening their menus and reconcepting with strategy in mind. According to Datassential, a food industry market research firm that analyzed over 4,800 menus across the U.S., 60-percent of restaurants reported reducing their menu size in 2021. 
Smaller menus bring two obvious advantages. They\u2019re generally easier for staff to execute \u2013 particularly valuable when dealing with a short-staffed back of house. And they help eliminate waste. <\/p>\n

\u201cStart by considering product availability. Factor in labor components like item complexity \u2013 \u2018Can we make this with limited staff?\u2019 \u2013 and finally, compare items\u2019 profitability to determine if each item should make the revised menu cut,\u201d says Delvall\u00e9e. \u201cIn other words, shift consideration from \u2018Can we do it?\u2019 to \u2018Should we do it?\u2019.\u201d<\/p>\n

There are a variety of software platforms, like Meez and Apicbase<\/a>, that you can utilize to help take the guesswork out of engineering a menu, incorporating accurate food cost calculations and POS sales data. Generally monthly subscriptions run from $15 to $100. <\/p>\n

When menu concepting, look for ways to cross-utilize ingredients across dishes. \u201cWhen you consolidate, you have less types of products in the door, which means you\u2019re inevitably going to save dollars,\u201d says Sharkey. \u201cThe more various types of products you bring in the door, the more opportunities you have to waste them.\u201d<\/p>\n

Plan ahead with market trends & strong vendor relationships<\/h3>\n

At certain times, every single year, you can predict price surges for a variety of different ingredients. If you\u2019re really trying to trim costs, plan your menu with the market in mind. \u201cEvery year it happens \u2013 limes just go up in the spring. Try to identify the trends so you can plan ahead,\u201d says Sharkey.<\/p>\n

Your vendors should be able to provide you with market reports. Of course, if your biggest seller is guacamole, you\u2019re just going to have to stomach the volatile prices of avocados. But you\u2019d be smart to establish strong relationships with your vendors so you can gain a heads-up on when prices are about to increase on ingredients you use often. When you can, remain flexible, whether that means sourcing an alternative cut of meat or looking towards alternative sources of protein when called for by the market. <\/p>\n

\u201cIn general, it’s about finding a balance between offering different kinds of proteins and ingredients throughout your entire menu, so that when cost changes on a specific item, you are not so dependent,\u201d says Delvall\u00e9e.<\/p>\n

Adapt portion sizes, mindfully<\/h3>\n

When looking at the bigger picture, don\u2019t forget the basics. In some cases, it may be beneficial to scale back portion sizes on certain items. You\u2019ll want to observe customer behavior to decide which items you adjust.<\/p>\n

\u201cWatch your customers \u2013 go into the dining room and see what they\u2019re eating,\u201d says Sharkey. \u201cAre people eating the entire salad you\u2019re serving? Does it need to be 16 ounces or could it be 14 ounces? For something like cheese, the difference between three ounces and four ounces, if you\u2019re selling thousands of orders a week, is a big deal.\u201d<\/p>\n

Again, look for where there\u2019s wiggle room. Are there side dishes that are getting frequently tossed in the trash or ingredients you can scale back on? Depending on your business model, you may even try enlisting your managers for real-time customer feedback. As with price raises, it\u2019s important to use data to back the changes you\u2019re making for success.<\/p>\n

Get creative<\/h3>\n

Depending on your restaurant, now might be the time to start really flexing your creative culinary capacity. Can you ditch the beef and instead transform, say, broccoli stems into an award-winning dish?<\/p>\n

\u201cThere are thousands of examples where if you really know how to cook, you can make delicious food out of overlooked ingredients or ingredients that get thrown out,\u201d says Sharkey. \u201cFor example, you can beautifully roast a Vidalia onion and stuff it with rice and make it something incredible, and that\u2019s an onion that costs you 19 cents. Customers aren\u2019t just paying for the food, they\u2019re paying for whatever experience you\u2019re giving them.\u201d<\/p>\n

Of course, if wiping certain menu items is going to leave your regulars upset, get creative within your boundaries. Take chicken, for example. Wings are now subject to not only cost increases but supply chain issues, and now might be a good time to find creative ways to incorporate the whole chicken rather than a specific cut. \u201cThe same can be said for beef right now,\u201d says Delvall\u00e9e.<\/p>\n

The more you can expand your existing toolkit and think outside the box, the more opportunities you have to create new dishes that aren\u2019t just profitable, but that make you stand out among your competitors.<\/p>\n

\u201cNecessity breeding ingenuity \u2013 this is where great dishes are born out of,\u201d says Sharkey.
 <\/p>\n","protected":false},"excerpt":{"rendered":"

Increasing prices isn’t the only step to fighting labor, inflation and supply-chain pressures.<\/p>\n","protected":false},"author":19,"featured_media":5615,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[110,69],"tags":[],"class_list":["post-5614","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-restaurant-bars","category-running-your-business"],"acf":[],"yoast_head":"\nHow to adjust your restaurant menu to combat inflation<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/gfs.com\/en-us\/ideas\/how-adjust-and-adapt-your-restaurant-menu-combat-inflation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How to adjust and 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