with citing a reference rising prices of vegetables – including staples such as onions and tomatoes – many restaurant They fear they may have to resort to some other solution. price hikeSince the discounts are definitely going to stop, either way, customers will have to spend more money.
While such high prices are usually seasonal, this time they are beyond a “digestible level”, Anjan Chatterjee, founder of Speciality Restaurants, which owns brands such as Oh! Calcutta and Mainland China, told the Times of India. “This is causing us a lot of losses. Our earnings are going down,” Chatterjee said, suggesting that prices are being reviewed. “Right now the price hike is being tolerated, but we don't know what will happen tomorrow,” he added.
Sagar Daryani, co-founder and CEO of quick service restaurant chain Wow! Momo, said that if vegetable prices do not come down in 15-20 days, the brand may have to increase its prices. Menu Prices in August-September. “We haven't increased prices in the past one year. My entire momo sauce is made from tomatoes and chillies, but I can't charge my customers extra for it,” Daryani said. The company has pursued automation to manage its costs and save labour expenses.
Smaller eateries are facing even more difficulties. Mumbai-based burger and pizza joint Bites N Grill has reduced the number of tomato slices used in its burgers and has also removed Caesar and Greek salads from its menu due to high salad prices, founder George Kuriakose said. Burger-maker QSR firm Boba Bhai has started withdrawing discounts on some of its products, founder Dhruv Kohli said. For smaller chains that don't have the advantage of playing with scale, raising menu prices risks losing customer base, forcing them to make other adjustments.
Large restaurants usually have annual contracts with their vendors to buy supplies at a fixed rate, but price fluctuations have forced some of them to demand higher rates. To help some of its smaller vendors in Delhi, Massive Restaurants, which owns brands such as Farzi Cafe and Masala Library, has allowed a marginal increase in rates (at which it buys supplies from vendors) for a period of 45 days. “We have annual contracts, but sometimes in the spirit of partnership, we have to give some discounts to help our vendors stay afloat,” said founder and MD Zorawar Kalra.
Supply of good quality vegetables has also become a challenge. Climate change“Rising costs are impacting menu planning and inventory management by restaurants,” said Chirag Makwana, head chef at Mumbai's Olive Bar & Kitchen. “Our aim is to minimise the impact (of rising costs) on our customers, but some price hikes may be inevitable. We also consider menu engineering,” he added. The challenge comes at a time when heavy rains in some areas have impacted footfall.