Managing Inflation and the Rise of New Restaurant Fees

As of recently, you can’t turn anywhere without hearing about inflation. It is affecting gas prices, electricity, utilities, rent, and of course, food costs. Over the past 12 months, meat, poultry, fish and eggs have seen a 14.3% increase in price, while fruits and vegetables have seen 7.8% increase

With increased food costs, rent, and utilities, how are restaurants responding? With already extremely tight profit margins and tight budgets, food service operations cannot simply just swallow the rising costs of everything. As restaurants have always done, they must adapt to the current environment. 

One way restaurants are responding to inflation is by adding fees and service charges on top of taxes and tipping. For example, Romano’s Macaroni Grill announced that all orders would have a $2 fee to offset economic pressures. 

Another technique is being used is reducing portion sizes of menu items. Burger King reduced its chicken nugget count from ten to eight pieces in Q3 of 2021, the first modification since this menu item’s inception. 

Restaurants looking to remain competitive

For now, many restaurants are adding fees to compensate for increased ingredient and operation costs. Nothing seems to be safe from inflation for the time being. However, are customers going to be okay with continuously paying for additional fees tacked on to their check? It is unlikely that your diners will tolerate this forever. 

The same goes for smaller portions. Reducing the number of chicken nuggets a customer receives by one or two nuggets may go unnoticed for a while. What will happen when inflation continues, and more changes must be made? Fees and reducing serving sizes cannot go on forever. 

Smaller portions may make sense for your restaurant and menu items, but there is a smart way to go about this. Ingredients that are more costly should be used in smaller quantities, while more affordable ingredients can be used to fill out the plate. Take notice of when customers eat at your restaurant. Is there any dish in particular that never gets finished due to the large serving size? Chances are you can reduce the size of this dish without many noticing, and still keep your customers full and happy. 

As we saw at the National Restaurant Association Show, restaurants and foodservice operations will likely trend towards having smaller footprints. Rent is often cited as one of the highest operating costs for restaurants, so it doesn’t make sense to pay for unused or unnecessary space. Another smart move for lower rent is operating out of a food hall, where dining areas and restrooms are all shared spaces and not paid for by your establishment. 

Reducing the size of menus has also been a recent trend, especially after the pandemic’s supply chain issues. Instead of multi-page menus, foodservice operations can offer single-page menus that only offer the most popular dishes. Ideally, menu items share several ingredients to further simplify the menu and cut costs. 

Vendors selling to restaurants 

Vendors selling to operators and owners in the restaurant space know how greatly inflation impacts this industry. Restaurants have always had tight budgets, and this is more true than ever. Restaurants, especially now, do not have disposable income to spend willy-nilly on new tech, even if the tech would greatly streamline operations and increase profit margins.

Restaurant tech, like kitchen management systems, delivery solutions, inventory software, and employee management tools can all help restaurants save money. Overordering, food waste, overstaffing, and order mix-ups can take away money from already razor-thin profit margins.

Despite the obvious benefits that restaurant tech brings to foodservice establishments, vendors need to make sure that they are talking to the right people. It is a waste of time, energy, and money to attempt to sell to restaurants that aren’t the right fit. For example, Brizo offers direct contact information for 782K+ decision-makers in the food service and restaurant space. 

Taking a data-based approach, vendors can increase the possibility of sales to restaurants. When restaurants, which are nearly all struggling with the negative impacts of inflation, speak to vendors offering top-of-the-line, cutting-edge tech, they will also greatly benefit. It’s a win-win situation.    

How restaurant data saves money and increases profits

Sure, tacking on extra fees and service charges might be working as a short-term solution to inflation. However, customers will become frustrated over time, and restaurants cannot simply continue to add on more fees. Therefore, restaurants looking to survive, and ideally thrive, should use data to reduce costs, save money, and increase profits. How exactly can restaurant data do all of this? Restaurant data can:

  • Show trending and popular ingredients
  • Inform menu design
  • Collect information on long-term trends
  • Improve marketing campaigns 
  • Increase speed and quality of service

Accessing the right data to combat struggles from inflation

For vendors selling to restaurants and restaurants looking to stay competitive, data can be the secret tool. Vendors shouldn’t waste time speaking to foodservice operators that aren’t interested, and restaurants don’t have the extra time or money to spend on the tech that doesn’t serve them. With inflation at a 40-year high, no one has time, money, or energy to waste. With that being said, up-to-date, precise restaurant data can help foodservice operators, restaurants, sellers, and vendors stay one step ahead. 

Brizo Foodmetrics can provide strategic information for your food service, restaurant, or technology business needs in one fast, easy-to-use, data-rich platform. With comprehensive restaurant industry statistics, Brizo is there to help vendors analyze competitors, find new markets, discover packaging solutions, and more. For restaurants, Brizo can help analyze their market share, research competition, and fulfill the unmet needs of customers.

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