Restaurant Chains Expected to Raise Menu Prices In Second Half of 2013

Chain restaurant leaders are optimistically watching traffic and sales, with expectation of raising menu prices later this year, according to a new survey conducted by supply chain cooperative SpenDifference.   he company last surveyed chains on menu price topics in late 2012.

The study, completed the week of May 13, found that nearly two-thirds of chains (64 percent) held the line on menu pricing during the first quarter, raising prices 0.5 percent or less. However, more than 90 percent anticipate upping prices this year an average of 1.6 percent. One-third of respondents expect increases of 2 percent or more. Less than 10 percent plan no increases, which is much lower than last year.

Chain executives are optimistic about 2013, anticipating same-store sales growth of 2.2 percent, which would be about 25 percent higher than 2012. With first quarter sales essentially flat, all of the growth is expected in the final three quarters of the year. Executives predict 75 percent of this growth will come from price increases, with the remaining coming from stronger traffic.

“From the data and discussions with our members, it appears that they believe consumers may be more willing to accept higher prices, especially with the economy strengthening,” says Brad Moore, SpenDifference senior vice president. He adds that operators also recognize that they must cover a larger portion of inflation to meet their bottom line. “But even the larger price increases they are planning this year will only cover about 75 percent of expected menu inflation, which they forecast at just under 2 percent.” Chains are renegotiating contracts more frequently, with nearly 75 percent identifying that as their top cost-control strategy. About 60 percent are looking at promoting limited-time offers or existing menu items with better margins.

“The reality, though, is that most chains—especially mid-size ones—cannot further reduce costs significantly on their own, given their limited personnel and leverage in the marketplace. This is where organizations like ours pay big dividends,” Moore says. “To protect or improve their margins, operators need to look beyond menu price increases and contract negotiations, and find other ways to save money in their supply chains.” Respondents were evenly split among full-service and limited-service concepts and represented chains with fewer than 100 to more than 800 domestic units.

Back

Duke Witte absolutely was amazing! 

I am writing to express my sincere gratitude to Duke Witte for his assistance in finding me a new job in the hospitality industry. I was disgruntled with my previous job, and I was feeling very discouraged about my prospects. I had been working in the restaurant industry for many years, and I had a lot of experience and skills, but I was having a hard time finding a better opportunity.

I was contacted via LinkedIn by Duke, and thank goodness I was.  Mr. Witte was incredibly helpful and supportive throughout the entire process. He took the time to understand my skills and experience, and worked tirelessly to find me a job that was a good fit.

Duke was also very honest and upfront with me about the job market. He didn't sugarcoat things, but also didn't give up on me. He kept me motivated and encouraged, and never gave up on finding me a job that I would love.

I am so grateful to Duke Witte and his team for their help. I am now happily employed, and I am so happy that I was able to find a job that I love. I would highly recommend him to anyone who is looking for a job in the restaurant industry. He is a true professional, and is dedicated to helping his clients find the perfect job!

Thank you again for everything!

Nick Grubbs

Working with Chris Bovio made job searching so much easier! 

Not only was he available and involved in my search, but also knowledgeable regarding the position. Chris used his industry experience and recruiting network to find the best position for me and my skill set. My only regret is that my new job is so perfect for me that I won’t need to use Chris or Patrice & Associates later.

Thanks,

Nick Guarino

Michael Greig was absolutely fantastic in every way! 

He gave me options and suggestions & eventually found a great for me. Communication was easy and he went above & beyond. Also, he seems like an all around good dude. Thanks again Michael. Solid work out there. You’re hired :)

Nic Callahan

Bryan Curtis was fantastic to work with!

Bryan was very on top of things throughout my recruiting process to the engineering firm I accepted my position with.  I responded to his LinkedIn posting and heard back from him within 24 hours. He continually spoke with me throughout the process checking in regularly and answering all my questions. Bryan was instrumental in helping me find a great job.

Thanks!

Austin

Frank Rondeau was a really big help! 

When it came to helping me find my new job, he knocked it out of the park!  He was very honest and thorough throughout the entire process. We had multiple conversations along the way and he always checked in after interviews. Frank was amazing to work with, and I'm super excited to start my new journey thanks to him.       

Many Thanks,

Chyanne

Read More Testimonials