Operators Keeping Total Food Menu Inflation Low Through Menu Management

Total food menu inflation from June to September was +0.9%, well below CPI. Chain and pub and bar restaurants are focusing menu inflation on new dishes, with new dish inflation higher than same-line dish inflation across both channels.

These market developments have been captured by the latest Menu Tracker Report by Lumina Intelligence. The research has also registered coffee & sandwich and restaurant inflation as the highest at +3.3% and +2.4%, respectively.

New starters, sides and desserts priced higher than existing dishes

Menus overall have experienced an increase from June to September 2022, with a total number of 137 items on average by the end of this period, +1.8% more than what was observed in June 2022.

Sides, starters and desserts that were new in September 2022 are +23%, +14% and +8%, respectively more expensive than the average dish.

Operators are introducing more sharing dishes across discretionary courses including starter and dessert dishes, to encourage spend as consumers cut back on non-core dishes.

Sharing items have increased in share of starter, main and dessert from June to September 2022, accounting for 7% of total restaurant menus, increasing to 14% of desserts.

There is scope for operators to increase the price of sharing starter, side, and dessert items, with these dishes currently just +47%, +39% and +13%more expensive than non-sharing dishes.

Same-line dish price inflation is highest for starters, sides, and snacks

Starters, sides, and snacks registered +1.7% from June to September, meaning that operators have increased the prices of existing dishes, with starters ranking the highest surge, most at +2.8%.

In this way, operators are finding a way to pass on unavoidable cost increases, though not at the rate of inflation, but by managing menus by adding/removing dishes instead.

“So far, operators have been able to avoid increasing food and drink price points in-line with CPI and food inflation. Instead managing menus through changes in proteins used, the types of dishes offered, and clever NPD has enabled operators to avoid alarming price rises,” commented Katherine Prowse, Senior Insight Manager at Lumina.