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Inflation leads to rise in restaurant prices

Posted at 12:15 AM, Feb 01, 2022
and last updated 2022-02-01 00:15:12-05

TALLAHASSEE, Fla. (WTXL) — As prices rise in the grocery store, the gas pump, and seemingly all around, restaurant owners like Jarrett Malloy say they're feeling those increases as well.

"There's been a rising cost for the price of inventory we're ordering. Cups, flavoring, sugar, anything," said Malloy. "Supply and demand. It's getting tough to buy these things and the increase in price on top of that," said Malloy.

Jarret Malloy owns Sneauxball. He says it felt like prices increased overnight.

"At one point, we were buying 50 pound bags of sugar for $20 and then they were $27 it seemed like overnight," he said.

Florida Restaurant and Lodging Association Senior Vice President Geoff Luebkemann says throughout the last year, restaurants just aren't making the same profit.

He says much of the rising costs come from transportation issues like gas prices as well as the labor shortage; but those aren't the only two issues.

"The price of steel has gone up significantly in the last year or so some somewhere between two and 300%," said Luebkemann. "Well, a lot of goods arrive at a restaurant in a steel cage and so those items increased and we again simply don't have the capacity to absorb those price increases and, unfortunately, have to pass them along."

This can all be summed up with one word- inflation. That's when prices rise and the value of money falls.

The Bureau of Economic Analysis says inflation rose at its fastest pace since 1982, with food prices rising 5.7% between December 2020 and December 2021.

So what will it take to bounce back?

"That is a very prescient question and the answer to that is going to lie and in a number of things that really are beyond the control of any given business operator," said Luebkemann.

Leubkmann says that includes the labor shortage and policy regarding the US Federal Reserve. Until that time, patience is key.

"Nothing is more disheartening to a hospitality operator than to have open seats in a restaurant or open rooms in a hotel and not be able to fill those not for lack of demand, but for lack of labor inputs, or maybe supply inputs," he said.

"Be patient with us. Please continue to patronize your favorite restaurant, your favorite hotel and know that we'll get through all this if we're just nice to each other," said Luebkemann.

Malloy says while he hasn't raised costs in a year, he's sure his customers will be understanding if he has to change them.

"We can be vocal about it and demonstrate why. Saying hey, the price of cups is going up so we're adding ten cents. But my customers are understanding," said Malloy.

Other restaurants say inflation is also why some foods aren't on the menu anymore or they're running out of items more frequently.