What does cooling inflation mean for your restaurant’s prices?

​At the time of this writing, it had just been announced that the U.S. inflation rate had dropped to 3 percent in June, a two-year low. It’s long-awaited good news for restaurant operators. To be sure, waning inflation could boost restaurant business indirectly because consumers are more optimistic about spending and less concerned about the prospects of recession. However, the news isn’t without some potential challenges. Restaurants continue to hike their prices faster than grocery stores, which a recent Restaurant Business report predicts could push lower-income consumers to shift their spending. Restaurants seem to be moving toward more moderate price increases, but it will continue to be important for operators to conduct ongoing analyses of their menu pricing, manage their inventory closely to stay ahead of supply chain snags, have back-up plans in place in case key ingredients aren’t available, and to price menu items in line with those trends. If you need assistance in managing these changes – or in finding ways to bring some stability to your costs and continue to offer value to your guests in a shifting economy – contact Team Four/Value Four for help.

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