We have currently been open for 6 months and besides cheese basically everything has gone up…We have a decent following, the store is turning anywere from 8500-9500 a week. In the past week we just got 2 new corporate accts, one a church that does catering for 200 every couple of weeks and the other is the jury dept in our local courthouse. With all that being said we are happy with sales but always looking to increase. It seems like the only way to stay afloat is by raising our prices by 10% all the way across the board…This may not be a huge increase, but are people going to notice/care?..we are so new and i dont want to turn off our regulars…We have people who eat 12 meals a week with us(lunch 7 days and dinner 5)…what are your experiences with raising you prices??..
PS we still have about 15,000 menus still printed from the 20,000 we opened with
Don’t let the menus keep you from raising prices. We have had three small price increases in the last 12 months and they have been recieved pretty well. A few customers have left, but sales are up. If you have only gont through 5000 menus in the last six months, you need to find a source that will sell you smaller quantities. Century Printing out of Tampa is a great place for two color printing. www.centuryprinting.com
I just raised my prices after being in business for 10 months. Wish I had done it sooner.
I raised my prices monday, and have had a record week. To be fair, I also launched a marketing effort starting at the same time. Maybe you could attempt the same?
I have had nobody even ask about the price increase, although Im sure some are not happy. I have a typed letter to my customers hanging next to the register that my employees are to give to any customer who asks about the increase. It basically informs them about the increases in products over the last few months. Educating the customers might not save them all, buy it does go a long way.
I justed raised my prices
I have always found if I add some new things to divert the attention it helps. Gives our employees something to talk about with regulars. The other thing you may want to look at is your specials. Are you getting menu price for most of your pizzas or are people using coupons? Raise the coupon not the menu price. Or change the coupon. Instead of raising a coupon a buck add an appetizer and raise it 5 bucks.
The other thing is be fair…do the work…don’t just do 10% across the board…what do you need to raise prices on and what can stay the same.
My 2 cents.
Kris
I tend to think like Kris . . . and I also am getting an itch to use a price increase to increase overall revenues. Raise, all of 'em, and I can have a smaller increase overall to get the same revenue impact.
Of course, I’m selling a 16" cheese pizza for $11 right now . . . and that is up $2 from original opening (last owner price) :shock:
thank you for all of your help…what I am not sure about is someone going to pay 13.25 for a pizza??..we are at 12 now and still growing…we are working at a 37% food cost which is rediculous…
If you don’t mind my asking a few questions, where are you located? Also, what size pizza are you talking about selling for $13.25?
Your 37% food cost is ridiculous. If you make a good quality pizza, people will still buy from you. You’ll always have the customers that buy on price alone, so don’t worry about them. They’re the ones that go to the big chains who run the cheap prices and low quality product.
I am with Roanoke here. What size pizza do you give for $12.
Lets say your paying 2.50 for cheese and put 3/4lb on a pie. $1.87
Lets say your making your own dough which your paying
$35 for a bag of flour. $.80
Sauce for the pizza. $.25
Box $.50
Total $3.42 or 28.5%
What are you paying for all this stuff?
We put in a pretty hefty price increase December 1st. We got some comments but we are in a high wage, high cost area. We charge about $20 for a 16" 4 topping pizza plus delivery and sales tax which takes it to about $24. We are doing about 20K a week right now.
I am located just outside of NYC. The cost of living here is very high, not to mention i’m in a very upscale town)…We only opened in october, and have been doing great since the minute the open sign went on. The only size pizza we have is a 16inch aside from pan pizza, sicilain, and personal pizzas.
On our 16 inch pie
20 oounes of dough-.53
4oz sauce-.25
3/4 lb grande whole-2.02
box-.30
wax paper-.2
3.12 for a cheese pie
twice a year we go through our menu and evaluate food cost, and what is and is not selling. ATM we are charging 15.50 for a 18 inch cheese pie(grande 50/50 mozz/provalone, and fresh grated Parmesan.) we get complaints every time we adjust the menu but as a whole there isn’t really a drop in buisness. there is always someone who will complain about taking off some oddball item that no one else ordered but him and his family. but thats where build your owns come in. ive had pizzas off the menu for years but still have all the items for it due to them being used on other pies. they can order it as a build your own(they are happy) they get charged a bit more since it is a build your own(were happy).
im a bit worried about the next price hike, because fuel surcharge for Alaska is easily 50% of the cost of some fresh produce.
sheb
We had a price increase in October and since then just about everything has gone up.
The new pricing had a 25% factor in costs for future increases but with flour and cheese this was immediately eaten up.
We are doing OK with prices but the returns have dimished from when I set the new prices so we are taking the steps of increasing our deals only. 2 Lge pizzas for $25.50, 3 for $36.90 etc go up $1. Drinks are going up 20 - 30 cents. Spare ribs are being downsized slightly from 450gm to 420gm a pack rather than putting the price up and pastas are being slightly downsized by about 10%. We are also being extremely prudent on toppings going onto the pizzas, nipping a bit here and there.
We have to be carefull with putting up prices as our flourishing economy is now bearing the brunt of 4 months of consequitive mortgage interest rate increases. Friday night be had what seemed like a boomer night with an extra roll out of large bases required but the takings were down about $300 - $400 as people went for the cheaper variants and very few premium or gourmets sold. They are also ordering less side orders. The same is with the Fish and Chip shop next door and the Noodle Box a couple doors up.
The extra $1 on the deals still gives the customer a great saving on buying 2 or 3 pizzas at single prices. We anticipate around $200 extra a week from the increase.
It’s all about the fine balance of cost savings and passing on an increase when and where you can.
Dave
So what items do you have that are EXTREMELY out of whack with food costs???
You break down the cost of a 16" cheese pizza to be $3.12 which is only 26% of the $12 selling price you state. If this is the case and you are running 36% food overall, you either have some serious problems with your priceing of something, or you have some serious theft going on. Am I missing something here?
Is $12 the “selling price” or the “menu” price? If the menu says $12 and you run typical coupon costs the selling price might be under $10 or even $9.50 in which case the food cost might well be in the mid 30s with other shorter margin products like apps.
I am seriously thinking about raising mine. I opened Nov 26 of last year but i am afraid that if i raise i might lose some of my existing base. But, i still get new customers daily so i hope the price won’t affect the new commers. My 16" goes for 17.59 plus tax. And i swear im still not sure of my food cost…close to low 30’s. No delivery so no POS. But my goal is to have one before the end of the year.
Rgates:
You don’t need a POS to Calculate Food Cost. Get a program like quickbooks and set up an account for every item you have in your shop. Whenever you receive a shipment, enter that into quickbooks. Once a week, take a physical inventory count. Expense off what you used. Divide it by your sales.
Food Cost = Beg Inv. + Purchese - Ending Inventory.
Example:
You take inventory every Monday at 9:00 am. On Monday, you have $3000 in Inventory. You receive a shipment on Thursday for food for the week. The Shipment is $2000 worth of product. The next Monday, you Take inventory again, you have $2500 in Inventory. Your food costs for the week are $2500.
$3000 + $2000 - $2500 = $2500. Your Sales were $7500 for the week, your food cost = .33%.
The POS will help you get deeper, by breaking down the cost of each item on your menu, figuring Ideal Food Cost, etc. But if you want to know your food cost week to week it’s fairly simple and doesn’t require a POS.
I use an Excel spreadsheet/workbook to track it all. Took time setting up, but it gives me detailed summaries of food costs, cleaning supplies, and a separate inventory spreadsheet gives me start and end inventory values for week or whatever time between inventories. Usually I do full inventory monthly.
Hello Pakula,Always in small print on your menus incluse [prices are subject to change] this will cover you when a complaining customer is telling you what the menu says.We’ve just raised our prices 10% and most customers are very understanding now that we have help from the media by covering stories on flour and chses.