Price increases don't have to mean losing customers if you handle them right. The real challenge isn't calculating new prices – it's timing the announcement and explaining changes without driving guests away. Success depends on understanding your margins and communicating with confidence.
When is a price increase really necessary?
Rising supplier costs don't automatically mean you should adjust your menu prices. But certain situations make increases unavoidable for survival.
💡 Example: When price increases are unavoidable
Your steak had a food cost of 30%. Due to price increases from your supplier, it's now:
- Old purchase price: €8.00 per portion
- New purchase price: €11.00 per portion
- Selling price: €29.36 excl. VAT
New food cost: 37.5% - too high for profitability
Signs that a price increase is needed:
- Food cost above 35%: You're not earning enough per dish
- Margin below €15 per cover: Not enough room for other costs
- Monthly losses: Revenue no longer covers costs
- Suppliers raising prices 15%+: Major impact on your total cost price
The 3 communication strategies
How you announce price changes determines whether guests accept them or walk away. Three main approaches work differently depending on your situation.
Strategy 1: The silent increase
You adjust prices without making announcements. This works for modest increases (5-10%) and restaurants that rarely change pricing.
💡 Example: Silent increase
You raise your main courses from €24 to €26. No announcement, just new menus.
- Increase: 8.3%
- Most guests won't notice right away
- Staff knows in advance what to say
Strategy 2: The transparent explanation
You explain exactly why prices need adjusting. This approach works well with loyal customers who trust your judgment.
- Post on social media or website
- Note on the table in the first few weeks
- Staff gets an explanation to pass along
- Focus on maintaining quality
Strategy 3: The value upgrade
You raise prices while adding something extra: larger portions, premium sides, or better ingredients.
⚠️ Watch out:
Only add value if your margin allows it. Otherwise you'll make the problem worse.
Timing of the announcement
Getting the timing right matters as much as your messaging strategy.
Best times:
- Beginning of the year: People expect this
- After a renovation: Logical time for renewal
- With a new menu: Fits with refreshing your concept
- Quiet period: Less impact on busy times
Avoid these times:
- Just before holidays (Christmas, Easter)
- During your busiest period
- Right after negative publicity
- In the middle of tourist season
What do you say to unhappy guests?
Some customers will always complain about price increases. Based on real restaurant P&L data, establishments that prepare staff with specific responses retain 23% more customers during price transitions.
💡 Example: What to say
Guest: "You've gotten expensive!"
Answer: "You're right, we've adjusted our prices. The quality stays the same and we want to offer fair prices for what we provide. We understand it stands out."
Good answers:
- "We keep our quality high, and that sometimes requires adjustments"
- "Our suppliers have also gotten more expensive"
- "We want to offer fair prices for what we make"
- "The quality of our ingredients is important to us"
Avoid these answers:
- "Everyone does it" (not true and weak)
- "We had no choice" (sounds like a victim)
- "It's not that bad" (dismisses their feelings)
- Long explanations about all your costs
Alternatives to price increases
Sometimes you can avoid raising prices by making other adjustments:
- 10% smaller portions: Same price, lower food cost
- Replace most expensive ingredient: Steak to bavette
- Adjust side dishes: Less expensive accompaniments
- Shorten menu: Keep only profitable dishes
⚠️ Watch out:
Smaller portions can generate more complaints than a price increase. Test this carefully.
Measuring the impact
After implementing price changes, you need to track the consequences:
- Number of guests per day: Are you losing customers?
- Average check value: Are people ordering less?
- Total revenue: Does the higher price offset the loss of customers?
- Complaints and feedback: What are guests really saying?
Tools like KitchenNmbrs let you immediately see the impact of price changes on your food cost and profitability per dish.
How do you communicate a price increase? (step by step)
Calculate the necessity
Check your food cost per dish. If it's above 35%, a price increase is probably necessary. Calculate how much you need to raise prices to get back below 33%.
Choose your strategy
Decide whether you'll increase silently (for small amounts), communicate transparently (loyal customers), or add value. Depending on your customer base and the percentage increase.
Train your staff
Give your team concrete answers to questions about prices. Make sure everyone tells the same story and understands why prices have been adjusted.
✨ Pro tip
Track your top 5 dishes' profit margins weekly for 30 days before announcing any price changes. This data shows you exactly which items need adjustment and which can absorb cost increases.
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 you raise prices without losing customers?
Increases up to 10% go largely unnoticed by most guests. Above 15% becomes noticeable and customers may leave. It depends on your customer base and how often you raise prices.
Do you always need to announce a price increase?
Not always. For small increases (5-8%) you can adjust silently. For large increases (15%+) or if you have many regular guests, transparency often protects your reputation better.
What if competitors don't raise prices?
Check if they're offering the same quality. Often competitors use cheaper ingredients or smaller portions. Focus on your own profitability, not on others.
How often can you raise prices?
Maximum once a year, unless there are extreme circumstances. Raising prices too often irritates guests and gives the impression you're not stable.
Should you raise all menu prices by the same percentage?
No. Start with dishes where your food cost is too high. Popular, profitable dishes can often stay at the same price longer while loss-leaders need immediate attention.
What's the best way to test customer reaction before a full price increase?
Try a limited-time "premium version" of your most popular dish at the new price point. Monitor sales volume and customer feedback for 2-3 weeks before deciding on broader changes.
📚 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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