The cost of beef is getting higher. In fact, not only are beef prices rising, so are the prices of other common restaurant food staples like bacon, eggs, poultry, fish, coffee and orange juice. The USDA has shown a 0.4 percent food price increase (the all-items Consumer Price Index, or CPI). However, some of the largest price increases were seen in beef prices, which as spiked 4% from January.
So why exactly is beef so expensive nowadays? There are several factors that come into play; the recession had led to a decrease of ranchers as well as the droughts which caused smaller pastures and thus less cattle herds. And there seems to be little hope to a relief in high beef prices any time soon. Market analyst, Kevin Good, has noted that these higher prices may continue into 2015 or 2016.
In the meantime, how’s a restaurant to cope? In times like these, it’s a good idea to take a look at your restaurant supply chain management. Are you inspecting your menu and diversifying with lower-cost products? Are you locking in prices from your vendors to curb seasonal price increases?
If you need help with your supply chain management strategies, contact Synergy Consultants.
Blog, Supply chain management