Most restaurant owners believe raising prices will instantly drive customers away. This fear keeps many establishments stuck with razor-thin margins while costs continue climbing. The reality? Your guests might be more willing to pay higher prices than you think.
Test your price elasticity step by step
Price elasticity measures how much demand drops as prices rise. In restaurants, this gets tricky because diners make emotional decisions and stick to habits.
💡 Example:
You sell 100 pastas per week for €16.50. You're considering €18.50.
- Current revenue: 100 × €16.50 = €1,650
- With 10% fewer sales: 90 × €18.50 = €1,665
- With 20% fewer sales: 80 × €18.50 = €1,480
Up to 15% fewer sales, you still earn more.
Signs that you can raise your price
Certain signals indicate your market has room for higher prices:
- Full restaurant, hard to book: Demand exceeds your supply
- Few complaints about prices: Guests think your price-quality ratio works
- High food cost (35%+): Your ingredients cost more, but prices haven't budged
- Competitors already raised prices: Market accepts higher prices
- Many regular guests: Loyal customers care less about price
⚠️ Note:
Never raise all prices simultaneously. Test your most popular dishes first - they generate the most sales, so you'll spot guest reactions quickly.
The 10-15% test rule
Here's a rule of thumb: if revenue drops less than 10-15% after a price increase, you're financially ahead. Calculate this beforehand:
💡 Calculation example:
Current situation: 200 covers/week × €22 = €4,400
New price: €25 (+13.6%)
- Break-even point: €4,400 ÷ €25 = 176 covers
- Maximum loss: 200 - 176 = 24 covers (12%)
If you lose fewer than 24 guests, you earn more.
Timing of price increases
The moment you raise prices largely determines success. From tracking this across dozens of restaurants, these windows work best:
- September/October: After vacation, people adjust to new prices
- With menu renewal: New menu makes new prices feel natural
- After renovation/upgrade: Better experience justifies higher prices
- Beginning of the year: Everyone expects inflation adjustments
Avoid increases just before Christmas, in January (people are broke), or mid-season without reason.
Measure and monitor after the increase
After a price increase, track these figures for the first 4-6 weeks:
- Number of covers per day: How many guests still come?
- Average bill value: Are people ordering less per person?
- Total revenue: The end result of both
- Customer feedback: What are guests saying about prices?
💡 Real-world example:
Restaurant De Smidse raised 3 main courses by €2.50:
- Week 1-2: 8% fewer covers
- Week 3-4: 5% fewer covers
- Week 5-6: 3% fewer covers
Revenue ultimately increased by 9% because people adjusted to the new prices.
Plan B: what if it goes wrong?
Sometimes a price increase goes too far. Signs you should backtrack:
- More than 20% fewer covers after 4 weeks
- Many complaints about prices
- Regular guests stop coming
- Total revenue drops structurally
In that case, you can:
- Temporarily run promotions (20% discount on weekdays)
- Add a cheaper menu option
- Make portions slightly larger without lowering price
- As a last resort: reverse the price
How do you test a price increase? (step by step)
Calculate your break-even point
Divide your current weekly revenue by the new price. This gives you the minimum number of covers you need. If you can lose more than 15% of covers and still break even, the increase is probably safe.
Test on 1-3 popular dishes
Start with your best-selling main courses. Raise these by 10-15% and leave the rest of your menu unchanged. This way you can immediately see if guests order differently.
Monitor for 4-6 weeks
Record your number of covers and revenue daily. People will still be adjusting in the first week. Only after a month will you see the real effect on your customer behavior.
✨ Pro tip
Track your table turnover rate for 3 weeks after any price increase. If guests linger longer but order the same amount, your effective revenue per table hour might actually drop despite higher menu prices.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
How much can I increase without losing customers?
An increase of 10-15% is usually accepted, especially if you communicate it well. More than 20% at once is risky unless you clearly offer more value.
Should I announce my price increase to guests?
You don't have to, but a subtle mention can help. For example: 'Due to rising ingredient costs, we've adjusted our prices.' Guests appreciate honesty.
What if my competitor stays cheaper?
Not all guests choose based on price. If your quality, service, or atmosphere is better, you can charge higher prices. Focus on your added value, not the competitor.
How often can I raise my prices?
Maximum 1-2 times per year, unless your ingredient costs rise drastically. Raising prices too often irritates regular guests and gives an unreliable impression.
Do I have to make all dishes more expensive at once?
No, test your most popular dishes first. If those go well, you can adjust the rest later. This spreads the risk and teaches you how your market reacts.
Should I test price increases on weekdays vs weekends first?
Start with weekdays when guests are typically more price-conscious. If weekday diners accept the increase, weekend customers usually will too since they're less budget-focused.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
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