Restaurants battle inflation; new data shows food prices continue to increase
[anvplayer video=”5114799″ station=”998122″]
Eggs from $18 a case, to suddenly $37 a case in a matter of a week, are some of the price increases facing some Twin Cities restaurants.
“Every week there’s just some new price that jumps — as a business right after Covid — we’re just trying to look at numbers,” said Luke Derheim, co-owner and operations director at Craft & Crew Hospitality, a group of six restaurants.
New data from the US Bureau of Labor Statistics released on Friday showed the price of full service meals rose 9% over the last year.
With sharp increases in meat, poultry, fish went up more than 14% as supply chain and gas prices affect the industry.
“We know our customers have a threshold — people are only going to be willing to spend so much money for a burger,” Derheim said.
That’s left Derheim trying to find other ways to cut costs without passing along costs to the customer.
Over in St. Paul, on Como Avenue you can find the Finnish Bistro, with customers sitting on their patio.
“The prices have gone up and it’s made me uncomfortable,” said Sandra Weise, owner. “I don’t know what the end game is going to be, it’s unbelievable to me.”
Weise thinks about each of her customers that walk into her restaurant when trying to set a menu as the prices she pays for ingredients have increased.
“You disappoint people with the supply issues, and the price, it’s a tough spot to be in,” Weise said.
Federal data found that the prices for food away from home rose (all types of dining experiences) 7.4% over the last year, the largest 12-month change since the period ending November 1981.
“We often see in downturns people continue to want to have food away from home, but they may trade down from what they are used too — instead of a fancier they may go to a less fancy place,” said Steven Carvell, finance professor from Cornell University in New York. Carvell said large chain restaurants will be better able to control prices now, because of long-term set contracts with vendors, but continued inflation will eventually affect them.
“They are much more immunized to this process — not completely of course, eventually it will filter through to them as well,” Carvell said.