Anyone raising prices for 2010?

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guspas
Cheeseburger
2010/01/02 14:35:11
I'll prolly do it in March when i come out with my new menu.  Anyone else?
lornaschinske
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/02 18:22:34
Not us. We are still well within our markup margin.  I am keeping track of prices weekly though.  We have a fair enough buffer built in to our pricing even with the additional expenses added to doing business in TX.  Although truthfully, I didn't factor in the $500 I have to pay the TX tax revenue dept because we are "transients".  I do get it back in a  year if I pay my sales & use taxes on time.  We plan on adding coffee and hot cocoa to our menu. And we will be building another cart (daughter will take over the one we are using now).  Still don't foresee raising prices.
post edited by lornaschinske - 2010/01/02 18:24:01
catnhatnh
Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/03 16:56:56
Probably not. Last year on rising costs and an increase from 8 1/2% to 9% in our states "rooms and meals tax" we did about 2-3 minor adjustments and went from "tax included" to "tax excluded" pricing giving us an across the board increase of around 8 3/4%. The deciding factor was a single first-time customer who while praising our dog as a better product complained we charged $2.25 while a competitor (who was closed the day of his visit) charged "only" $2.00....It wasn't until a week or two later I stopped by the competitor's place and found his prices were "tax excluded" and that my customer had actually payed $2.17 for his dogs there and objected to paying 8 cents more for what he admitted was a better dog!!! In short he was perceived as a better value almost exclusively by burying the true cost. With folk like that wandering around we took the easy route and showed non-tax prices like the majority of the competition....
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/04 09:37:31
I show my prices tax included, 99% of my customers like this and when I shop I wish everyone did this.
I get a few people a year who tell me my competition is cheaper but were better. I don't let this bother me, if they want less quality for a cheaper price so be it.
I don't base my prices on my competitors costs or on the economy so when my costs go up my prices go up.
Seven years ago we were to cheap and I was afraid to raise prices. I knew we were to cheap because my customers were telling me that and were raving about the good deal they got, some even asked how we could do it. Still 10% of people complained the price was to high, they said they could buy way more at the grocery store for less.
The next year I raised my prices, I had more customers and less complaints about the price, every year since then I have raised prices as necessary and will again this year.
Last year I had 2 complaints that I know of about high prices, I couldn't begin to count the people who said they got a good deal and would be back. I'm hoping the price whiners have left the building and won't be back, they can carry spoons and dishes and buy at the grocery store.
Let your costs and required profit margin set your prices not a few whiners, competitors or the economy.
If you fall into that trap you will be poor forever feeding the poor forever while I feed the rich.
Here's an exercise for you.
You gross 100,000 a year.
Your average sale is 3.50.
You raise your prices 5%.
You lose 2000 customers because you raised your price.
Who wins, you or your customer?
Or
You gross 100,000 a year.
Your average sale is 3.50.
You raise your prices 10%.
You lose 4000 customers because you raised your price.
Who wins, you or your customer?
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/04 09:55:51
The subjective answer to both example might be the same if the answer was strictly math. Loss rate vs. price increase are simply x1 and x2.
 
Business growth rate is absent from the examples. Gross is still exactly the same. Just a different way to arrive at the number.
Dr of BBQ
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/04 10:01:00
Ice Cream Man Let your costs and required profit margin set your prices not a few whiners, competitors or the economy.
If you fall into that trap you will be poor forever feeding the poor, while I feed the rich forever.


I couldn't agree more on that.

But here is something to think about. A guy I respect very much wrote :

"You should be raising some of your prices in small increments every 3 to 4 months instead of waiting a year or longer and making larger increases to most items. The smaller, more frequent increases are less likely to be noticed. Not to mention, all those items that you changed prices on in the third month, your earning 9 months worth of extra revenue on compared to someone who waited a year and changed everything all at once."


Brandon O'Dell of O'Dell Consulting

Jack
post edited by Dr of BBQ - 2010/01/04 10:02:21
BillyB
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/04 10:12:02
I would rather my customer say "YOU RAISED YOUR PRICES AGAIN" once a year, and not 4 times a year. Why piss them off 4X a year, do it once and get it over with.............Billyb
Dr of BBQ
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/04 10:23:46
BillyB

I would rather my customer say "YOU RAISED YOUR PRICES AGAIN" once a year, and not 4 times a year. Why piss them off 4X a year, do it once and get it over with.............Billyb



Bill you didn't read the quote closely enough. "You should be raising some of your prices" not just raise your prices 4 times a year.

And it can be done with new specials or new menu items, or even the same menu item with a new twist.

If your customers raise hell over a few pennies your feeding the wrong people and if you don't raise prices your falling behind.

Jack
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/04 10:34:55
What the market will bear and will not consider sticker shock.
 
A $.25 increase every three months is a $.25 increase over time. A $1.00 increase from yesterday to today is not a $.25 increase. It is a $1.00 increase.
post edited by CCinNJ - 2010/01/04 10:54:53
Russ Jackson
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/04 11:14:18
Using Ice Cream Mans Scenerio based on a five day work week and 28,571 customers over the entire year:
Each penny you raise your price is equal to $285 dollars in profit over the course of a year. A 10 cent raise would equal $2850.00 in profit. Raising in increments might be the answer. Do you think you would lose customers using three or four ten cent price increases? Also have you tried raising your average ticket by offering additional items?  In a five day work week you average 110 customers per day if you can raise that number to 115 per day you will make a much bigger impact. Sometimes opening 15 minutes earlier or later can make a big difference over the coarse of a year. Ask your customers they will tell you what they want...Russ
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/04 11:25:40
Using that particular example if you progress with the same product same size your costs do not usually remain the same when you chip away at the customer base on an equally progressive level.
6star
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/04 12:45:02
I hate to be the math geek (which, of course, I am), but using Ice Cream Man's scenerio of raising prices 10% (and losing 4000 customers) vs. raising prices 5% (and losing 2000 customers), with the 10% price raise, ICM will lose a total of $5400 vs. only a $2350 total loss with the 5% price raise.  Therefore, he would do better overall with the smaller price raise.  I realize this scenerio is all theoretical, but it might be something to think about.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/04 13:28:03
The gross amount is the same in both examples.
 
 
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/04 16:17:42
The point is most people think if they raise prices they will lose customers, the answer is who cares, just as long as you can balance the loss to the price increase. If you do you won't lose anything. Just think, same money, less customers, equals less work.
I have found with honest price increases my business still grows, a fair deal for me and a fair deal for my customers.
I will not make 30,000 a year while my customers make 50,000 with no risk. I would rather do what they do and let someone else work there asses off for peanuts.
So my statement remains the same, set your prices through good times and bad on your costs and the profit margin you need not on what someone else is doing.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/04 16:43:07
The danger to the who cares formula can take place when if effects costs and potential supplier minimums. If your customer base constantly decreases (even with the same gross) the business is contracting. People get into all sorts of trouble when trying to simply hit on a number. They start to attempt to stock in advance if they try to keep the same supplier with purchase minimum while increasing perishable loss risk which also ties up dead money in inventory.
 
 
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/04 21:24:02
No worst than trying to hit a high customer count and not making any profit.
If you read the small print, as for my business prices are still fair to me and my customers so my customer count went up with my prices.
As an added benefit I believe I have gotten rid of the price only shoppers and that makes me happy.
Ridgeviewbbq
Junior Burger
Re:Anyone raising prices for 2010? 2010/01/07 10:26:47
At a time when all the big chains are lowering prices??? I think I'm gonna stand pat for awhile
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/07 10:51:06
Can't say I never check chain prices because I do but I give them very little weight when setting my prices because they are not my competition.
My customer want better quality and will pay for it.
If I don't give them quality they will simply move on.
BillyB
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/07 11:01:11
This isn't the time to raise prices in this economy. I would focus on food cost control, waste control, get quotes on all your insurance, see if they can be lowered. See if you can cut out a few hours a day in labor. this will help increase the bottom line and also your tax and in some cases workmens comp and unemployment insurance taxes. Check the prices on all you paper products. I buy foil sheets from Costco for $8.95 for 500, the same box is $19.95 from my Food serving company. Great time to work on customer service with yourself and your employees. Great time to get the dead weight off the menu, if you only sell one or two of something, why is it still on the menu..................................Good luck................Billyb
Sonny Funzio
Double Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/13 15:51:32

BillyB has it exactly correct.

In general, but particularly during periods where you are trying to improve operations, especially for profitability, jacking your menu prices around is extremely UNsound. 

It is impossible to obtain consistent baseline numbers to analyze and control operations if you are changing your menu pricing and mix arbitrarily.
If profitability is a problem, first you stop the “bleeding out” in other aspects of operations ... but *not* initially by menu modification.

Even if you know your ship is NOT  taking on water and profitability is adequate, you should *still* have good reasons for menu/pricing changes.
  And improving profit is not just increasing prices.

“Specials” are excepted here ... they are accounted into your operations, in part, both wholly and separately. 
Real “specials” are traditionally items which you obtained specifically at particularly good cost ... often seasonal items, or items your purveyor has at reduced price ... and as such, are menu additions that provide extra margin to your overall menu (because you got the provisions at lower cost) ... and also consequently provide you some wiggle room on other things you might be offering ... and provide variety for your customers.

The caveat is that, each menu change in having "specials", affects other things on your menu ... you should know what that effect is.

CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/13 16:21:17
What happens when that simply does not work?
 
You follow a diciplined generic formula...and the numbers are neatly accurate down the line and the restaurant is in trouble for a reason that is not exampled in a textbook or neatly structured chain restaurant formula?
 
Do instincts ever kick in?
Sonny Funzio
Double Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/13 22:38:50
CCinNJ

What happens when that simply does not work?
 
You follow a diciplined generic formula...and the numbers are neatly accurate down the line and the restaurant is in trouble for a reason that is not exampled in a textbook or neatly structured chain restaurant formula?
 
Do instincts ever kick in?


Instincts should not have to “kick in” ... they should be “on” in the first place.  Most businesses don’t have the luxury of being unperceptive.

I’m certain that you don’t mean that if you use techniques of financial management that somehow that means you will ignore other things ... instincts, whatever.  That would be silly.

And if you require every possible scenario to be “exampled in a text book” as you put it ...  then you wasted your money on that education. 
The end result of good management practices (both financial and other) is that you not only learn “what” to think ... but “how” to think.   This is why good financial management techniques are the ultimate flexible tool in dealing with the unexpected.  There is nothing “generic” about the application of financial tools - and it is not a  “formula”, although it uses formulas.

And this isn’t a “chain restaurant formula”  as you suggest ... these exact concepts (such as Cost/Volume/Profit and Breakeven Analysis etc) that you use in a restaurant are EXACTLY the same as in other non-restaurant businesses.   The controls are the same, the “formula’s” are the same ... and the implications are the same. 

Understand that analysis is a process ... not an end point. 
It’s what you learn about your operations in that process and then how you apply that knowledge that provides the value.

Does financial management guarantee that you will stay in business?   Of course not. 
A new freeway re-routes commuters 15 miles away from the thoroughfare your restaurant is on  ... Or a big chain restaurant that competes in your market segment moves in across the street and kicks your butt on quality and prices you can’t possibly match ...  Or the auto plant lays off 4000 of your customers in the area immediately surrounding your neighborhood. 
There is only so much you can do to avoid being hit by a comet.
But your best bet in dealing with it is going to be by using best-practices in your financial management, analysis,  projections, alternatives ...

If what you meant to ask was something like:  “Can’t instincts take the place of financial management practices?” ... the answer is no.  This is why with sources of professional capital ... equity partners ... debt sources such as banks ... it’s not just for the hell of it or on a lark that they require you to figure out this stuff and include it in black and white in your proposal or business plan.

You asked:  “What happens when that simply does not work?”
The answer is ... it’s not a “formula” that’s not working ... it’s your restaurant that’s not working.  And it’s up to you to find out why ... and the most robust tool you have to do that is financial management ... not just Analysis including Breakeven but the entire process that lets you understand and modify your business ... menu, location, employees, debt service, advertising  ... everything. 


post edited by Sonny Funzio - 2010/01/13 22:46:13
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/13 23:14:07
Education is a foundation. Statistical analytical approaches are common. So common that they often don't work and often fail miserably in a generic manner...because they fail so often.
 
Do you have to know the numbers by the book?
 
Yes.
 
Do they always guide you in every decision?
 
No.
 
The restaurant business is very instinctual. Risk/reward. You cannot lock in to counting beans and have total control of a business that is a spontaneous creative art at the same time.
 
 
Sonny Funzio
Double Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 01:13:43
CCinNJ

Education is a foundation. Statistical analytical approaches are common. So common that they often don't work and often fail miserably in a generic manner...because they fail so often.
 
Do you have to know the numbers by the book?
 
Yes.
 
Do they always guide you in every decision?
 
No.
 
The restaurant business is very instinctual. Risk/reward. You cannot lock in to counting beans and have total control of a business that is a spontaneous creative art at the same time.
 
 


CCinNJ, the thing I find of concern in your responses is that you try to give the impression that the financial management of a business using widely proven financial tools and analysis is not worthwhile ... maybe even contemptible.

You are doing a *tremendous* disservice to anyone you convince of that.

Sound analytic approaches are UNcommon ... not “common” as you state.  And the “statistical” component of business analysis that you note is a very minority part.  If you understand the process then you know this.

If financial management and analysis “fail so often” as you claim, it is because someone doesn’t know what they’re doing.

Having been in the restaurant business since the mid 70's; coming from a family of restaurateurs going back over 70 years, and having previously been a  Restaurant Consultant providing a full range of services ... concept, start-up, operations, turnaround -  I've seen a lot of operations ... and I can tell you that a majority of restaurants are run without any comprehensive analysis whatsoever ... mainly because it can be incredibly time consuming, for both the learning curve as well as the analysis itself in an already time-intensive business. 

This is a big part of the reason so many restaurants don't make it.

Most restaurants fly by the seat of their pants. ... by that I mean they do some of the numbers but they don’t utilize a coordinated, structured process to draw conclusions period over period, to take structured actions to improve profitability, to make operational corrections, or for long-range planning.

Most operations significantly guess.

You wrote:  “Do numbers guide you in every decision? ... No”

“Every” is a loaded word.  There are always outliers to every axiom.  So “every”? ... No.  Of course not.
However nearly every decision you make in your restaurant is in the service of it as a business ... and that means earnings, dollars, profitability ... all numbers.
The overwhelming vast majority of all your decisions *are* reflected in and based on numbers.
Maybe not where you hang a piece of art ... but whether you put a couch under it.  Maybe not the style of chair you purchase ... but how many of them you purchase.
Bottom line ... if there is any aspect to a decision that warrants a broader examination of it’s affects on your business’s results ... then it is worth understanding that relationship ... including in numbers.

You state: “The restaurant business is very instinctual. Risk/reward.”
Yup, it is ... and in fact *All* business is instinctual and has dynamics of  risk/reward.
And taking risks does have a sizable component of instinct in the decision process.

I'm not saying don’t go with your instincts ... I'm saying don't do things which you have not bothered to think through, that includes instinctive or “gut” decisions.  Menu pricing was the original example on this thread.
Now, sometimes in the absence of concrete factors to make a decision, your instincts are the best way to go.
And the character of your restaurant ... the character that “makes” your restaurant to your patrons ... has to do with things other than numbers.  But behind all of it, it has to hold water financially ... that means not making poorly-thought decisions.

You state: “You cannot lock in to counting beans and have total control of a business that is a spontaneous creative art at the same time.”  
I would add the word “just” ... “you cannot *just* lock in to counting beans ...”
And “Lock” into???   Your desire to see this all as one-sided is curious.  This or that.  Yes or no.  Black or white.  Life is not like that ... nor is business.

And as far as beans? ...  if you don’t “count beans” ... you will eventually have none.

That’s it for me on this.   As this thread was originally about menu pricing, it’s kinda gotten hijacked.  Not my intention.

(Sheesh, and I’d promised myself I wouldn’t make a novel out of this ... <sigh>  ;-)


post edited by Sonny Funzio - 2010/01/15 04:01:16
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 02:11:15
In general, but particularly during periods where you are trying to improve operations, especially for profitability, jacking your menu prices around is extremely UNsound. 

It is impossible to obtain consistent baseline numbers to analyze and control operations if you are changing your menu pricing and mix arbitrarily.
If profitability is a problem, first you stop the “bleeding out” in other aspects of operations ... but *not* initially by menu modification.
I don't agree  increasing prices is unsound.
Who said they were doing it arbitrarily?
Who said their business was bleeding out?
I agree you need the numbers but don't make assumptions about someone else's business.
Sonny Funzio
Double Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 03:34:58
Ice Cream Man

In general, but particularly during periods where you are trying to improve operations, especially for profitability, jacking your menu prices around is extremely UNsound. 

It is impossible to obtain consistent baseline numbers to analyze and control operations if you are changing your menu pricing and mix arbitrarily.
If profitability is a problem, first you stop the “bleeding out” in other aspects of operations ... but *not* initially by menu modification.


I don't agree  increasing prices is unsound.
Who said they were doing it arbitrarily?
Who said their business was bleeding out?
I agree you need the numbers but don't make assumptions about someone else's business.



>>  “I don't agree increasing prices is unsound.”

Do whatcha want ... you don't have to take my advice.
As far as I'm concerned, if someone does it just for the hell of it ... then it’s unsound ... and especially during periods of attempting to make corrections to operations.

>> “Who said they were doing it arbitrarily? “

They who?
I didn’t suggest anyone in particular was doing it arbitrarily.
You need to read a little bit more closely before you go teeing off on somebody.  ... I was speaking generally and not to any person in specific .

>>  Who said their business was bleeding out?

Whose business??  Who are “they”?  I’m speaking in general terms.
I said IF profitability is a problem, then making menu pricing adjustments should not be the first course of action considered.  (which is something that is a common response when there are problems with profitability)

>>  “don't make assumptions about someone else's business.”

Someone?   Someone who??  I referred to NO one specifically.  These were general comments.
I think you should take your own advice and don’t make assumptions ... in this case about what someone else is saying.  Go back and read more carefully before getting an attitude.


post edited by Sonny Funzio - 2010/01/15 03:52:58
Russ Jackson
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 07:24:19
Chains don't usually change their Menu Pricing they change the menu itself by offering new items. This allows them to increase retail while the customer has no clue. Creative ways of restructuring the menu by offering something different at a higher margin might be the answer. Sometimes the new item will make an old item obsolete. Making limited changes is usually better than drastic ones. Customers hate sticker shock and add on items. Sound add on items work but everything alcart does not. JMO...Russ 
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 08:21:46
I think Ice Cream Man said the perfect statement....don't make assumptions.
 
I never said or advised anyone to not pay attention to the financial management aspect of their business. That would be silly.
 
What I do know is that there are individual factors that determine individual formulas. Numbers are numbers and they do not mean much and will not do anything for you unless you know what you are bringing to the table. In the restaurant industry that means food & drink. The value of that fluctuates based on individual factors.
 
There are countless examples of creative projects by individuals   that would send red flags to an auditing system on paper way before it all came together. Someone banks on talent drive and persues a unique aspect of a market to achieve greatness. The hard work vision and funding come first. It depends on the talent and vision to make it come to life. There is no accounting system to create  talent drive and vision. If they listened anyone who told them not to do it because it has never been done before ...they would laugh. It is only a risk if you feel it cannot be done. If it could be done and you let the financial  (time money lack of another example exactly like it) dictate you away from the project it never happens. If it never happened there would not be so many people huddled around in absolute awe of the Grill Zilla in Illinois and will be served awesome food as well. 
    
You are invited to tell my friends at Carlo's City Hall Bakery that they are CRAZY!
 
A family business in a city that is one square mile. The goal...to make Carlo's Bakery a household name. Is that all? Yes. Excellent. Cannolis? No. Lavish cakes. Lavish cakes?  Who does he think he is...the Cake Boss? Yes. Excellent.
post edited by CCinNJ - 2010/01/15 08:59:57
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 09:28:10
Sonny I wrote that about 2.30 am and knew it sounded bad and didn't feel like sugar coating it.
What I also wanted to say was you started with BillyB has it exactly correct.
I disagree with that statement, this is as good a time as any to raise prices.
What Billy goes on to say should already be done, if you haven't stayed on top of your costs you are in trouble. That being said raising prices is the only thing left to maintain the profit level you have chosen.
I believe the strong will survive and the mediocre will perish, it's not hard to survive in good times.
In the big depression there were 20% unemployed with no safety net, I see the 80% with money.
Now we have 10% unemployed with a safety net, I guess I could lower my prices cut my costs and be part of the safety net.
Or I could go along like I know what's best for my company and raise prices as I need to.
By the way no business ever wins a price war, the chains have it wrong.
Russ Jackson
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 09:36:21
Do you really think nobody ever wins a price war?
I beg to differ on that one.....Russ
BillyB
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/15 10:06:42
Ice Cream Man

Sonny I wrote that about 2.30 am and knew it sounded bad and didn't feel like sugar coating it.
What I also wanted to say was you started with BillyB has it exactly correct.
I disagree with that statement, this is as good a time as any to raise prices.
What Billy goes on to say should already be done, if you haven't stayed on top of your costs you are in trouble. That being said raising prices is the only thing left to maintain the profit level you have chosen.
I believe the strong will survive and the mediocre will perish, it's not hard to survive in good times.
In the big depression there were 20% unemployed with no safety net, I see the 80% with money.
Now we have 10% unemployed with a safety net, I guess I could lower my prices cut my costs and be part of the safety net.
Or I could go along like I know what's best for my company and raise prices as I need to.
By the way no business ever wins a price war, the chains have it wrong.


Your assuming that all restaurants control their costs. I feel as long as the restaurants profits are good, and the bottom line is maintained, they don't worry about anything. When the economy falls they don't have any idea of how to cut costs to save money, they think the only option is raising prices. Most of these restaurants have 1000's of dollars in hidden bottom line profit. Raising prices is the last thing I do, we didn't raise any prices in 2009 and I raised my bottom line company net profit by 11%..................If you have less people buying a ice cream cone in this economy at $1.50, they are not going to rush the door at $1.75. Watch how lager companies make money in hard times, its not by raising prices, its by controlling costs, and being better at what they do.            "Price wars are for the big boys, not the little guy"...............Billyb
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 10:23:20
It is not always about wasting money. That is the point. Sometimes it costs more to execute because of positive factors that benefit you in the big picture. There are some trade offs in the restaurant industry. Paying more for x is a red flag....unless it has an associated benefit with y & z that can be recognized on an individual basis. There is no factor to crunch numbers with certain quality suppliers. You often become the first audience at certain quality items that are in hot demand...at the best price simply because you are not there with the calculator at all times saying "no...can't do it because it does not fit into my chart or  graph" 
 
There is also the labor factor. Costs associated with unique talent rather than just a set of hands. There is often a trade off there because unique talent often comes with standards...a hard head and  unconventional unique manners of execution. They might be people who are the driving force and it would not be the same without them.
 
 
post edited by CCinNJ - 2010/01/15 10:29:05
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 10:28:10
I didn't assume everyone had their costs under control.
I said they should have them under control.
I don't worry about you Billy because I know you understand that price control is on going and that you can always find better and cheaper ways to do things. That's why you netted 11% more last year.
The original question was, anyone raising prices, my answer remains the same and my reasons remain the same.
Russ I would be interested if you could tell me of a company that won a price war.
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 10:30:49
I enjoy your posts CC, they make sense to me.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 10:35:56
Thank you Ice Cream Man. I like having a friend named Ice Cream Man. That is fun.
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 10:45:04
That's what the kids around town call me, I kind of enjoy it when I'm around town and I here them say, That's the Ice Cream Man.
It's kind of like seeing your teacher out of school.
Besides that I've been called worse.
Russ Jackson
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 10:51:33
Ice Cream Man

I didn't assume everyone had their costs under control.
I said they should have them under control.
I don't worry about you Billy because I know you understand that price control is on going and that you can always find better and cheaper ways to do things. That's why you netted 11% more last year.
The original question was, anyone raising prices, my answer remains the same and my reasons remain the same.
Russ I would be interested if you could tell me of a company that won a price war.


McDonalds decided to produce coffee at 99c which has destroyed the Starbucks nation. Soon 5 Guys will become a challenge for McDonalds and they will respond with a much lower price. Home Depot did it and ran almost every hardware store out of business. Home Depot and Lowes are doing the same thing in carpet today as very few Mom and Pops still exist. Low prices offered by Chain places like Applebees and TGIFriday have put a huge impact on Mop and Pop diners. Cities like Dayton Ohio have almost no Mom and Pops left. Look at what Domino's, Little Ceasers, Papa John's have done to the Pizza industry....Russ JMO
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 11:06:36
Domino's has done nothing to the NYC pizza market.
 
Papa John's lasted about a month here.
 
Hardware does not translate to food.
 
 
 
 
BillyB
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/15 11:10:40
Ice Cream Man

That's what the kids around town call me, I kind of enjoy it when I'm around town and I here them say, That's the Ice Cream Man.
It's kind of like seeing your teacher out of school.
Besides that I've been called worse.


Hey ICM, When my customers see me, its, "There's the Bastard that comes to work in a Hummer and raises prices". I think they love me, I just don't feel it..............Billyb
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 11:13:45
I wouldn't call your examples price wars.
I would call them volume sales V.S non volume.
A price war is two companys with basically the same product going at it on price alone.
I don't believe Mom & pops go out of business because of Chains, I can show you where they not only coexist but thrive. 
McDonalds decided to produce coffee at 99c which has destroyed the Starbucks nation. Maybe this is a price war, maybe not.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 11:14:55
Ice Cream Man

That's what the kids around town call me, I kind of enjoy it when I'm around town and I here them say, That's the Ice Cream Man.
It's kind of like seeing your teacher out of school.
Besides that I've been called worse.


That is cute and exactly what the business is all about. People call me Cookie...and it is fun when they are REALLY REALLY trying to yell in my direction  and not laugh. I usually start laughing.
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 11:15:52
Got me laughing Billy.
That's why I won't buy a new car.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 11:22:56
Ice Cream Man

Got me laughing Billy.
That's why I won't buy a new car.


You could buy a white Hummer and they won't get mad if you play a jingle while sportin' around. They may try to flag you down.
BillyB
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/15 11:29:34
Russ Jackson

Ice Cream Man

I didn't assume everyone had their costs under control.
I said they should have them under control.
I don't worry about you Billy because I know you understand that price control is on going and that you can always find better and cheaper ways to do things. That's why you netted 11% more last year.
The original question was, anyone raising prices, my answer remains the same and my reasons remain the same.
Russ I would be interested if you could tell me of a company that won a price war.


McDonalds decided to produce coffee at 99c which has destroyed the Starbucks nation. Soon 5 Guys will become a challenge for McDonalds and they will respond with a much lower price. Home Depot did it and ran almost every hardware store out of business. Home Depot and Lowes are doing the same thing in carpet today as very few Mom and Pops still exist. Low prices offered by Chain places like Applebees and TGIFriday have put a huge impact on Mop and Pop diners. Cities like Dayton Ohio have almost no Mom and Pops left. Look at what Domino's, Little Ceasers, Papa John's have done to the Pizza industry....Russ JMO


It wasn't the chains that drove out Mom and Pop, it was the good citizen's of Dayton, Ohio. We pay the price of progress in many ways, this is one that hurts real people, our next door neighbor...............I called the General store in a Small town in the Blue Mountains of Oregon yesterday to see what the snow level is. I have a Mountain home about 16 miles from the town of 200 people. I was on the phone with her for a half hour, she told me to stop by when I'm coming through, We haven't seen you for a while. I never heard that from Home Depot, or any other large chain....................Billyb
NYPIzzaNut
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/15 11:33:21
Russ Jackson

Ice Cream Man

I didn't assume everyone had their costs under control.
I said they should have them under control.
I don't worry about you Billy because I know you understand that price control is on going and that you can always find better and cheaper ways to do things. That's why you netted 11% more last year.
The original question was, anyone raising prices, my answer remains the same and my reasons remain the same.
Russ I would be interested if you could tell me of a company that won a price war.


McDonalds decided to produce coffee at 99c which has destroyed the Starbucks nation. Soon 5 Guys will become a challenge for McDonalds and they will respond with a much lower price. Home Depot did it and ran almost every hardware store out of business. Home Depot and Lowes are doing the same thing in carpet today as very few Mom and Pops still exist. Low prices offered by Chain places like Applebees and TGIFriday have put a huge impact on Mop and Pop diners. Cities like Dayton Ohio have almost no Mom and Pops left. Look at what Domino's, Little Ceasers, Papa John's have done to the Pizza industry....Russ JMO
I wouldn't think Starbucks and McDonalds have the same customer base.

CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 11:41:36
If Burger King rolls out specialty coffee for $.89 then Mc Donald's responds. Depending on that battle they go from there and wait for the next player to arrive. Eventually someone tries to formulate a process and system to do it faster and cheaper. Then people who loved the specialty coffee notice that it is not as good as it used to be. At that point they may decide to do something else and you wait and see what Starbucks is doing now.
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 11:49:37
Not McD's core business they're just trying to steal a little bit.
To get even bucks will have to start selling crappy burgers, frozen fries and those so called pies with their 5 dollar coffee.
Nothing new, DQ only did soft serve until McD's, A&W,Wendys and who knows tried to cut there grass. Now they sell crappy food too. 
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 11:55:47
Are we off topic yet?
When I had a young family McD's was a regular stop, it served a purpose.
Now that I am old it's the last place I would go, I'll take my chances at Mom & Pops, I just wish I would be guaranteed what I expect.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 12:01:44
The fast food chain business is a much different formula. Some of the biggest mistakes made in the independent restaurant industry have been following the structure and yada yada buzz word formulas that are applied in restaurant chains. If it does not work? Well...that is on you. This works.
 
Sonny Funzio don't  you write a book or be distressed about what I do not know about that. Well...go ahead and I  will take it from there.
BillyB
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/15 12:04:33
Ice Cream Man

Are we off topic yet?
When I had a young family McD's was a regular stop, it served a purpose.
Now that I am old it's the last place I would go, I'll take my chances at Mom & Pops, I just wish I would be guaranteed what I expect.


ICM, At one time Mom & Pop would have broken their back to make sure your meal was great. These restaurants were all heart and soul, once you loose that, nothings left. You know when your eating food from the heart, its written all over your face.............Billyb
NYPIzzaNut
Filet Mignon
Re:Anyone raising prices for 2010? 2010/01/15 12:06:09
Ice Cream Man

Are we off topic yet?
When I had a young family McD's was a regular stop, it served a purpose.
Now that I am old it's the last place I would go, I'll take my chances at Mom & Pops, I just wish I would be guaranteed what I expect.

Yep we teens grew up on 15 cent burgers from Carrols


 but nowadays the only real fast food burger that I will stop for is White Castle - don't know why but I just love them when I am hungry and a distance from home.

CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 12:11:33
There has always been good food and bad food at Mom & Pop's. The focus is only on good when you wax poetic about what once was...not what is still out there.
 
Don't tell me there are no good hard working people who own fast food franchises. That is their business.  When you decide to get into the business you cannot structure the business in the same manner.
Russ Jackson
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 12:14:27
The buying power and cost a big company is so low that they can sell product cheaper than a Mom and Pop can buy it. It has become cheaper to go out for dinner in many ways than it is to do it at home. Try making a hamburger with cheese for 99c. 10 meals for $10 dollars each http://www.applebees.com/2for20.aspx. You and I may see price wars a little different. But show me a farmer that can compete with Mexico on produce. Preservitives have allowed these companies to buy meat from third world countries. Because of price wars we no longer eat fresh food. Hard to believe that we live in a world that its cheaper to eat a Mexico Tomato or Hot House at $3.39 lb than to purchase a locally grown one even in season. When was the last time you actually saw a butcher? Price wars drove him away. Inch by Inch we have allowed this to take place until it has all been outsourced and it is finally catching up with us. When was the last time you saw a Mom and Pop located next to a Freeway? Prices sent him packing or they bought his property at a price so good he couldn't refuse and now we pay the price for the fast food crap that stands there today. Salt is cheaper than flavor so just salt the hell out of it and we will buy it. Price wars drove sugar out of soda. Heck it drove sugar out of everything....Russ
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 12:14:29
I guess it stems from anyone can do it.
Used to be only good cooks would do a restaurant.
Now it's, that guy looks busy lets do that, you see it here, Please help I think I want to buy a cart, they don't even do tests they just roll it out and sell dogs.It's not a wonder there's so many for sale on line. I'm not a cart guy but if I did I would be at least a month of cooking dogs on it for family before the wheels turned.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 12:22:27
You cannot compete without vision talent and excellent food. There are too many of those types of people who want to be in the independent restaurant industry. Chain food sucks but they want to serve the same stuff at higher costs and frame it like it is better just because they are independent. There is no survival management system to prevent someone from getting smoked and eaten alive when they do not have extraordinary talent vision and work ethic. Or are very lucky.
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 12:22:56
Russ Jackson

The buying power and cost a big company is so low that they can sell product cheaper than a Mom and Pop can buy it. It has become cheaper to go out for dinner in many ways than it is to do it at home. Try making a hamburger with cheese for 99c. 10 meals for $10 dollars each http://www.applebees.com/2for20.aspx. You and I may see price wars a little different. But show me a farmer that can compete with Mexico on produce. Preservitives have allowed these companies to buy meat from third world countries. Because of price wars we no longer eat fresh food. Hard to believe that we live in a world that its cheaper to eat a Mexico Tomato or Hot House at $3.39 lb than to purchase a locally grown one even in season. When was the last time you actually saw a butcher? Price wars drove him away. Inch by Inch we have allowed this to take place until it has all been outsourced and it is finally catching up with us. When was the last time you saw a Mom and Pop located next to a Freeway? Prices sent him packing or they bought his property at a price so good he couldn't refuse and now we pay the price for the fast food crap that stands there today. Salt is cheaper than flavor so just salt the hell out of it and we will buy it. Price wars drove sugar out of soda. Heck it drove sugar out of everything....Russ


I don't disagree with you Russ, except a lot of us baby boomers will pay the price for Mom & Pop if they hold up their end.
I'm not the least interested in a 99 cent burger or 10 meals for 10 dollars.
I agree that North America has gone for a **** (my words not yours) and won't wake up until it's to late.
Ice Cream Man
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 12:25:09
Oh Oh the censor got me.
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 12:27:50
Can we buy a vowel?
Russ Jackson
Double Chili Cheeseburger
Re:Anyone raising prices for 2010? 2010/01/15 12:44:59
I also think a whole generation today does not know what quality is because of price wars. They can only eat Mechanically Seperated, Processed, Preformed, products made to look like the original. People under the age of 30 today will not eat anything with a bone. Ribs, Chicken or Steak. They also wont eat anything cooked with any ammount of Pink in it. The Big Boys created this on there own so they could throw all kinds of crap and fillers in the product to keep prices down. What is in a Chicken Nugget? A Mom and Pop will not be able to serve real fried chicken anymore. Heck have you looked at what a local grown non-steroid Chicken sells for. A chicken of 20 years ago looks nothing like a chicken today and the one from 40 years ago is even more different. The color of a real chicken would scare most people to the point that they would think it was bad. Pigs are the same way. The Pork from a local place is a completely different color than the one you see in the store. Most people today don't even know what Bacon should taste like. Quality is a thing of the past in this Country for the time being. Price has been the deciding factor in my opinion. If you brought a whole fish home today and cleaned it in front of your children would they eat it or run? ...Russ
CCinNJ
Sirloin
Re:Anyone raising prices for 2010? 2010/01/15 12:50:26
You don't have the luxury of feeling that way if you are in this business. Some do and they give up...give in...or close up.
 
That is like saying nobody wants or appreciates carpeting! Run! Run! Roll yourself up and roll off a mountain!
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