Restaurateurs – Check Your Pricing

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So we’re reaching the end of the year and you’re going to see a lot of these ‘preparing for next year, what to do to finish out this year’ list. I’m going to give you a series of videos of things that I’m doing with my clients last week we talked about budgeting and I’ll put that link right down here (https://youtu.be/4tlRtVhXmXM). Today we’re going to talk about another one of my favorite topics – pricing. So obviously this has been a wild and crazy couple of years. We’ve all heard about supply chain issues, we’ve all heard about labor issues. Have you been paying attention to your margins? Do you know what it’s costing you to deliver your goods? Your raw materials are going up, your fuel costs are going up, your shipping costs are going up. So this is a great time to just check those numbers, check and make sure that you know what the cost is to deliver your products. I was talking with a restaurant or recently who hadn’t changed his prices. He tried, he worked very hard to keep his prices stable during the pandemic and I’m a little worried that some of his dishes, maybe he may be selling at a loss, and that’s fine if you do it consciously, but do it consciously. So tip one in pricing is, check your cost, check your cost of goods, check your cost of labor, make sure you know what the cost is to deliver your product. Tip two is check your competitors. I tend to order the same kinds of things all the time. So I ordered a salmon caesar salad from someplace I regularly go, It was $25. I thought oof! that’s expensive. Then about a week later I went out to dinner with a friend and ordered a salmon caesar salad. It was also $25. So that seems to be the going price for a salmon caesar salad in Connecticut. My restaurant friend, his prices were a few dollars, maybe three or $4 lower than that. And finally tip number three, make sure that you know what your customers expect. If you’re fine dining, you have a little bit more wiggle room. If you’re trying to be a bargain place, you’re going to need to be a little tighter on those margins. If you have any questions about this or anything, of course you can always reach out to me. But if you’re just interested in in this year and series of videos, subscribe to the link down here (https://www.youtube.com/playlist?list=PLOg1moPYQKRyN3rN9JfqXC_cQuht0a7ei) and you can get all of them on my YouTube channel. This is Judi Otton and with GrowthCast and I’ll be back next week with one of my year end Fiscal Fitness Tips of the week