Need help defining your strategy?

Feel like fighting inflation and rising costs? Incentivio shares its top tips for achieving these goals.

Restaurant menu prices have never been higher than they are now. To fight inflation, all parts of the chain are forced to raise their prices. Grocery store prices are rising along with restaurant prices. And with the current economic climate, no one can predict whether food prices will rise again, stabilize, or return to normal.

In this difficult environment, the task for restaurateurs is to find the best method to stabilize their menu prices. They must balance the various pressures of inflation, staff shortages and supply chain issues. The main objective is to set prices so that they are not overly affected by the various cost increases, and push away consumers who are tired of seeing prices rise. Easier said than done, you might ask? Not sure...

5 steps to a realistic pricing strategy

We advise you to adopt a flexible, customer-centric pricing strategy. General price increases should not make you forget your customers, nor should your margin target make you raise your prices unreasonably.

Choose a solution that helps you control costs and reduce manual intervention. You'll also collect vital information about your customers to better understand and communicate with them. 

1 - Increase your prices strategically 

The first thing you need to do is raise the price of your menus. But to avoid alienating your customers, be strategic about which ingredients you raise the price of.

It's not a good idea to add a few dollars to each item on your menu in one day. Instead, through your analytics, see which items are ordered the most and add a small price increase to them. Your customers understand the impact of the economy on their food. So they'll be inclined to pay a little more.

Continue to make small increases over a fairly long period of time, and watch your customers' behavior to see the impact of your price changes. You may decide to lower prices, or increase them but a little later. Industry experts recommend a maximum increase of 1.5 to 2 percent.

2 - Balance your menu prices with your customer data

A successful pricing strategy is all about balancing your high-cost and low-cost ingredients. With a pricing strategy based on transactional data and customer segments, you assess where prices are high and where they are lower. 

Gathering data on your customers allows you to make better menu pricing decisions, taking into account high volume items, but without the risk of losing your customers' trust.

3 - Add new recipes to your menus

Customers are not only paying for food, but for an experience with your brand. Various shortages and inflation will require you to get creative with your menu items! Try to design new dishes with ingredients that you don't use much, but that cost less. Choose those that can excite the sweet tooth and keep consumers coming back for more. There is no harm in updating your menus if you keep the popular items that your loyal customers usually order!

4 - Update prices according to revenue channels

If you are featured on a mobile app and in addition your customers can order online or pick up their food from you, we advise you to consider different pricing on these different channels. For example, customers are willing to pay a little more to be well received, have loyalty benefits or be able to order more easily.

5 - Use market trends to set your prices

You don't have to wait for a problem to adjust your rates. If you do it in advance, your pricing strategy will avoid any surges in the event of a problem. So we recommend planning your pricing when you notice certain ingredients becoming more expensive. Rely on suppliers or market reports to anticipate when these changes will occur. 

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About RusHour

RusHour s mission is to become a trusted partner for restaurants worldwide, offering several products and services that help restaurants adapt to the technology and trends of tomorrow. We provide our clients with a unique way to manage all online orders from multiple platforms from one place. At the same time, our team of experts is on hand day in and day out to support restaurant owners through this change.

Any questions? Write to us: hello@rushour.io

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