Marketing Restaurants Trends

5 Restaurant Tips to Reduce the Effects of Inflation

Restaurants that have survived the pandemic are now threatened by recent inflation. People are quickly feeling the price increases among everyday items affect their decisions. 

Now restaurant owners are faced with the effect inflation has on the industry. Inflation can cause an increase in costs in all aspects of the restaurant industry. That includes rent, food, labor, utilities, and insurance. 

According to the Bureau of Labor Statistics, wholesale food costs were 17% higher in March than last year. Along with a rise in hourly earnings for employees than the prior year. 

Establishments deal with rising costs of goods while seeing fewer customers walk through the door. Some people are eating out less and finding it more affordable to cook at home. Cutting back is the first thing people begin to do when prices rise. Diners are more hesitant to dine out because their everyday expenses rapidly increase. With interest rates rising, people find it more challenging to borrow money or lines of credit as well. 

Here are 5 tips to help you fight inflation, save money and keep customers in the door. 

1. Find Ingredient substitutions 

Restaurant owners can agree that food costs are one of the biggest challenges, especially when it comes to inflation. Taking a closer look at your inventory costs can be beneficial by revisiting your cost analysis. Is there any ingredient that you use a lot of that’s seriously cutting into your budget? Or maybe a hot-selling dish brings significant revenue but includes pricey ingredients which impact your profit. 

By exploring ways you can swap ingredients for something less pricey, you will begin to see savings. 

2. Audit your menu 

To do a proper menu audit, take all the factors into account in your menu and the profits you make on each dish. Sort the menu items out from the most highly profitable to the least. When you’re finished, evaluate what you can cut off your menu and save for something more critical, or put the money elsewhere into another dish. 

To do this properly, you’ll have to take a good look at your menu and know the profit you make on each dish. Segment your items into four groups and make adjustments based on their performance. Take into account which dishes really work and which one’s dont. 

3. Consider Price Changes

Increasing your prices may actually prove to be more beneficial to your establishment. Consider adding ingredients to make the cost more valuable, or try including a premium side to bundle and spend more. 

4. Reduce food waste 

If you’re not on top of monitoring your inventory, you may risk a big part of your budget by not accounting for food costs. Don’t just count inventory; dig into your numbers and understand where exactly you are losing money due to waste and over portion sizes. If you notice that guests are finishing their plates, you may need to look into smaller portion sizes. Optimize your recipes and use the most out of all your ingredients. 

5. Try to Reduce Food Costs 

Profitable restaurants usually incur 27%-36% of their revenue on direct food costs. In the current inflationary environment, keeping a close track of our direct food costs is more important than before. Accurate and consistent ordering from reliable vendors should also help. Do not hesitate to ask for price break volumes and freeze food if it makes sense. We occasionally see local merchants and wholesale clubs like Restaurant Depot, Costco and Sam’s Club offering limited-time deals on quality food products. A lot of small independent restaurants we have talked to do not hesitate to buy through such retailers, especially the products which they have tried before.


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The American Rescue Act Plan includes 28.6B for Restaurant Relief: Here’s What You Need To Know.

On March 11th, the House of Representatives passed the American Rescue Act, which will provide 28.6 billion in restaurant relief funds. This plan includes the $28.6 billion in relief grants for small restaurants, including $1,400 stimulus checks for Americans with incomes under $75,000.

The Restaurant Revitalization Fund (RRF) is a restaurant-specific grant program that will administer these grants to restaurants that are eligible to apply. This $28.6 billion will provide up to $5 million to restaurants that qualify. 

These grants will allow us to balance the economy and the damage done to struggling restaurants around the country. National Restaurant Association president and CEO Tom Bené said in a statement that this is just the beginning of a much longer recovery process but is hopeful for the impact these grants will have. 

The Small Business Administration (SBA) will open up the Revitalization grants application process within the upcoming weeks. Posts about qualifications, instructions, and further information will soon be available. 

Here’s what we know so far: 

  • Most American restaurants and bars that lost revenue in the past year will most likely be eligible to apply.
  • The establishments named for eligibility include: “restaurant, food stand, food truck, food cart, caterer, saloon, inn, tavern, bar, lounge, brewpub, tasting room, taproom, licensed facility or premise of a beverage alcohol producer where the public may taste, sample, or purchase products.”
  • Businesses must meet the franchise requirements of under 20 locations to meet the grant requirements.
  • Publicly traded entities cannot qualify. 
  • Applications will be prioritized by groups, including women, veterans, and oppressed groups who have received prioritization for the first wave of grants before a wider rollout.
  • The whole application process will take around 30-45 days.
  • The SBA website will be the technology platform dealing with applications to make the process as efficient as possible. Once up and running, the program will make direct payments to applicants—a change from SVO operations used in other grants the past year. 
  • These changes are there in the hope of a smooth transition for the hundreds and thousands of applicants expected to apply.


The SBA does not yet have an official launch date, those interested in RRF grants should keep a lookout on the SBA’s Covid-19 relief options on their website. 

Not every restaurant was operating for the entirety of 2019 and 2020. In that case, the program states:

  • Restaurants that weren’t operational in 2019 can receive a grant equal to the difference between the establishment’s average monthly revenue multiplied by 12. 
  • Restaurants that weren’t in operation until 2020 can receive a grant equal to the sum of eligible expenses minus gross receipts received.
  • Restaurants that aren’t in operation at the time of their application date can still receive grant funding, but only if it has made eligible expenses 


The National Restaurant Association launched its latest covid-19 impact survey. Concierge taking a few moments to fill out the survey to help with data collection for local, state, and federal outreach efforts. 

Take the Survey

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