Midway through the fourth quarter, 2012 annualised price increases were averaging between 1-1.5%, with chains expecting to take some additional late-year pricing increases.
In 2011, the majority of chains reported raising prices about 1.5%. Perhaps more telling, in 2011, 14% took little or no price increases (0-0.5 %) at all. Last year, 26% held the line on pricing.
Brad Moore, SpenDifference senior vice president, said: “The vast majority of executives responding to the survey reported flat to positive same store sales for the most recent quarter. “Nearly a third of the chains reported comp store sales increases of 4% or more.
“But they also told us that traffic lagged over the past quarter, which speaks to the state of the economy and the potential impact of pricing taken in 2012.”
Most price increases to date (63%) were taken across the board, although nearly a quarter of chains (23%) reported raising entrée, soup and salad prices.
The executives projected menu inflation for 2012 to run 1.7%. “That may be overly optimistic,” Moore said. According to SpenDifference, commodity price increases in 2012, on average, topped 2%.
“2012 was already at a high level for many items, and concepts that purchase a lot of beef and dairy saw increases of more than 5%.”
Source: SpenDifference
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