Restaurants vs. Retail: Who can raise prices?

Apr 13, 2014

Have you noticed it is getting more expensive to eat out?  Recently, many restaurants have raising their prices in an effort to protect themselves from soaring food costs.  Whether it is the avocado shortage in California or the shrimp disease in southeast Asia, these events affect food prices across the world.


While restaurants are able to raise menu prices and pass the costs along to consumers, it’s not as simple for retailers such as grocery stores. Groceries are commodities sold in a variety of channels, giving the consumer a choice and the ability to shop selectively.  In order to remain competitive, groceries must swallow the increase in costs and find ways to cut costs in other areas.  Read more in this article from Bloomberg Businessweek: