QSR May 2022

| M E N U P R I C I N G | fresh ideas The Delicate Art of Menu Pricing

Consumers appear willing to foot the bill to dine out these days. But is there a breaking point?

Inflation has forced operators to play a balancing act unlike anything we’ve seen in decades. / B Y B A R N E Y W O L F

R estaurant operators of late find themselves in a precari ous position few have experienced: trying to figure out the best methods to price their menus amid a range of inflationary pressures. The nation hasn’t experienced this level of inflation in 40 years, and, even then, restaurant operators were nowhere close to wit nessing the type of labor shortages that are now joining with various supply issues to exacerbate more typical cost stresses, like rising energy prices. “Pricing is really coming to the forefront,” says TomCook, prin cipal at Westport, Connecticut-based restaurant consulting firm King-Casey. “Now, it’s not only the cost of goods that are going up, but the cost of labor that these operators have to face.” Restaurants began encountering some of these concerns even before the economic turmoil created in the wake of COVID

19. Ingredient shortages over the years forced changes in menus and recipes, while labor concerns started appearing several years before the pandemic. Unlike the past, however, when owners could focus on one issue at a time, “this is occurring on a massive scale that has people thinking of it in a separate way,” says Dirk Izzo, senior vice pres ident and general manager at NCR Hospitality, which provides fiscal technology solutions. There’s no doubt inflation has impacted what the consumer pays at limited-service restaurants. According to the U.S. Bureau of Labor Statistics, prices for meals and snacks at these eateries jumped 7.2 percent for the 12 months ending in March. The BLS estimates overall food prices could rise another 4 per cent in 2022. “For the majority of operators, it will be very difficult to avoid

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