“Afraid of losing customers” is something that business owners don’t want to face! It’s not easy to get regular customers, but it’s also unacceptable to continue to lose money because increasing prices often affects the experiences that customers have received from our restaurant. What should we do if today business owners need to increase menu prices so that customers understand, are satisfied, and still choose to use our services?
1. Tell customers directly and provide transparent information on the raw material cost.
There is nothing better than explaining things to customers directly, with polite and clear words. To help customers visualize better, we might explain the cost of raw materials before and after COVID, or briefly update the current price of raw materials for customers, or add a calculation of the cost of raw materials of our shop to show how many % it has increased, by informing both at the store and online media. Let's take the example of Freddy's Curry Rice shop that explains the problem and informs customers of the cost in an easy-to-understand way.
2. Add some options to compensate for customer feelings.
For restaurants that use cheap prices as their “selling point”, if they increase the price, there are times when customers will be shaken because when it is a selling point, it is a form of marketing that customers will quickly become aware of. If you want customers to feel that it is worth it, you have to add some options, such as better service or experience, create some atmosphere to make customers willing to pay, packaging or containers that add value, etc.
Of course, everything has a cost, but if you look at it as a long-term investment or an additional selling point besides cheap price, it is worth it. It may even become a new signature of our shop.
3. If you want to increase the price, you have to stop using your guessing skills.
Raising food prices frequently doesn't look professional, plus it costs money to make menu books and promotional signs. What's more, customers may get annoyed! They may even go to a new restaurant. If you're going to increase prices, you have to stop raising prices randomly, following trends, or raising prices for every menu item in the restaurant!
Try to do your homework seriously on the price of ingredients. Calculate the cost, update news, or ask several suppliers. Check the market to see which ingredients are likely to increase in price further. You may focus on menus that already have high costs, and increase the price of those menus. Or cut out menus that are selling with little profit, not selling well, or that customers don't like to order in order to reduce costs first.
4. Don't let customers see the old price.
Some restaurants use a thin layer of Scotch tape to write the new price over, while customers still see the old price. This may cause repeated comparisons between the old and new prices, making customers feel that this menu item is more expensive than before.
5. Adjusting and adding new menus may be a less frustrating option.
I believe that there are some menus that have adjusted their prices, even the shop owners still feel that the amount given to customers is too little, not reasonable at such an increased price!? Don't pass on that feeling to customers. It's better to make a new menu in a menu line that is similar to the original or a menu that is more suitable for our customer group. Or transform that menu to look like it has value, making it reasonable to increase the price. It won't hurt to put that menu on hold for now, announcing that it's temporarily out of stock. It's better than opening the shop and taking a loss and getting your heart broken.
1. Tell customers directly and provide transparent information on the raw material cost.
There is nothing better than explaining things to customers directly, with polite and clear words. To help customers visualize better, we might explain the cost of raw materials before and after COVID, or briefly update the current price of raw materials for customers, or add a calculation of the cost of raw materials of our shop to show how many % it has increased, by informing both at the store and online media. Let's take the example of Freddy's Curry Rice shop that explains the problem and informs customers of the cost in an easy-to-understand way.
2. Add some options to compensate for customer feelings.
For restaurants that use cheap prices as their “selling point”, if they increase the price, there are times when customers will be shaken because when it is a selling point, it is a form of marketing that customers will quickly become aware of. If you want customers to feel that it is worth it, you have to add some options, such as better service or experience, create some atmosphere to make customers willing to pay, packaging or containers that add value, etc.
Of course, everything has a cost, but if you look at it as a long-term investment or an additional selling point besides cheap price, it is worth it. It may even become a new signature of our shop.
3. If you want to increase the price, you have to stop using your guessing skills.
Raising food prices frequently doesn't look professional, plus it costs money to make menu books and promotional signs. What's more, customers may get annoyed! They may even go to a new restaurant. If you're going to increase prices, you have to stop raising prices randomly, following trends, or raising prices for every menu item in the restaurant!
Try to do your homework seriously on the price of ingredients. Calculate the cost, update news, or ask several suppliers. Check the market to see which ingredients are likely to increase in price further. You may focus on menus that already have high costs, and increase the price of those menus. Or cut out menus that are selling with little profit, not selling well, or that customers don't like to order in order to reduce costs first.
4. Don't let customers see the old price.
Some restaurants use a thin layer of Scotch tape to write the new price over, while customers still see the old price. This may cause repeated comparisons between the old and new prices, making customers feel that this menu item is more expensive than before.
5. Adjusting and adding new menus may be a less frustrating option.
I believe that there are some menus that have adjusted their prices, even the shop owners still feel that the amount given to customers is too little, not reasonable at such an increased price!? Don't pass on that feeling to customers. It's better to make a new menu in a menu line that is similar to the original or a menu that is more suitable for our customer group. Or transform that menu to look like it has value, making it reasonable to increase the price. It won't hurt to put that menu on hold for now, announcing that it's temporarily out of stock. It's better than opening the shop and taking a loss and getting your heart broken.
