6 ways for F&B businesses to combat inflation

Since the Covid19 pandemic, a perfect storm of factors have sent global costs skywards. With about 90% of food ingredients in Singapore are imported, F&B businesses in Singapore are feeling the effects of the price hike and are faced with little option but to increase prices.

In this article, we cover 8 ways that may help F&B businesses combat inflation and the rising global costs of ingredients.

How should your F&B business combat inflation

1. Refrain from sudden price increases
2. Sell better products
3. Perfect portioning
4. Less seafood options
5. Promotions
6. Source other options

Refrain from sudden price increases

While your F&B business may be feeling the effects of global inflation, it is important to not implement drastic increases in prices. Keep in mind that your customers are also feeling the effects of global inflation.

Drastic increase in prices may just turn them away from your F&B business.

Instead, consider raising prices bit by bit to make it easier for your customers to accept.

Sell better products

While price is one of the factors that customers consider before patronizing your restaurant, another important factor is the value of your restaurant’s service and food quality.

Need to increase your F&B business’s food prices? Consider adding value to your dishes with better ingredients. This way, your customers will be more comfortable with paying more at your restaurant.

Perfect portioning

Make it a point that your restaurant staff know the exact portions to serve. This is especially important amid the global price hikes as F&B businesses could lose considerable margins if they are too generous.

Offer less seafood options

Fresh seafood prices are very volatile and have been greatly affected by the rise in costs globally. Instead of having a menu full of seafood options, consider swapping on seafood options with other types of meat.

Also, consider using frozen seafood to replace some of the seafood options on your menu. As frozen seafood are less prone to price fluctuations, it helps you control your costs better.

Run Promotions

While offering promotions seems to be counter-intuitive and almost nonsensical when cost prices are soaring, it is a great way to increase your bill size. How so? 

Instead of offering discounts, which flows over into your restaurant’s margins, consider bundling menu items together. There usually are some items on your menu that have tighter margins due to rising ingredient costs, and some that are consistently high margin menu items.

By bundling these two types of menu items together, it allows you to increase your bill size and improve your restaurants margins.

Source for other options

In order to keep cost prices low, your F&B business should always be sourcing for suppliers that offer lower prices or try to negotiate a deal to get ingredients at a lower price.

Getting a POS system that helps you save operational costs!

While most of tips given above are related to price control and cutting ingredient costs, a bulk of your F&B business’s cost goes into manpower. A good restaurant POS system allows you to integrate digital ordering solutions such as a QR ordering system, self ordering kiosk, and food delivery platforms to reduce dependency on manpower, thus reducing your manpower costs.

To get a free demo of MEGAPOS’s restaurant POS system, click here to contact us.