Chain restaurant prices going up this year

[Robin Garr]

From Nation's Restaurant News ...

A look at rising menu prices
NRN compiles latest restaurant chain expectations on price increases
March 8, 2011 | By Lisa Jennings

The challenges of rising commodity costs, paired with an improving consumer environment, are together giving restaurant operators some needed justification to raise menu prices.

In the recent round of fourth-quarter earnings reports, many companies indicated their plans for price increases in 2011, from a small 0.5-percent uptick to a 6-percent hike. It would be some of the first significant moves to take price after many operations have held prices steady through the recession, fearing cash-strapped consumers would be unwilling to pay more.

Nation’s Restaurant News took a look at a select group of companies that recently detailed their plans for menu pricing at the restaurants they own and operate. Not accounting for industry segment or average check, the average menu price increase for 2011 is 1.55 percent, according to the 12 companies NRN highlighted.

Read more: http://www.nrn.com/article/look-rising- ... zz1G6vttQ5

No doubt commodity prices are going through the roof. Fortunately, for many multi-unit concepts (that's PC for "chain" without the negative connotations... ) commodities are purchases in large quantities and therefore the impact of price spikes like this can be reduced. I would think the sharp increase in the cost of goods would hit the indie restaurants harder and necessitate price increases before it impacts the chains...errr...multi-unit concepts...

Then again, the word "justification" was used in that blurb and I think sometimes price increases are necessary as part of the fluctuation of the market and sometimes its exploitative padding, much like insurance, against future increases. Thus, the increase is "justified" by what is going on in the market.

It is much like a few years ago when gas went through the roof and all of the food distributors started tacking on "fuel surcharges" to offset the rising price of gas. Curious, however, that when gas prices lowered and stabilized, that pesky fuel surcharge didn't go away....