Q: I know product costs are going to continue increasing. What are the realities we’re facing in 2013?
A: The summer of 2012 brought a severe drought throughout the mid-west and much of the United States. Though some prices have increased, substantial price increases will hit in 2013 according to the USDA Economic Research Service (http://www.ers.usda.gov/data-products/food-price-outlook/summary-findings.aspx).
Increases are expected to be 3.0 to 4.0 percent. This cost increase is another $8,400 per $1 million in sales with an 80 percent food sales mix and a 30 percent food cost. Beverage pricing will continue to feel pressure as well. Implement these recommendations to avoid falling victim to inflation pressure:
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Q: I know product costs are going to continue increasing. What are the realities we’re facing in 2013?
A: The summer of 2012 brought a severe drought throughout the mid-west and much of the United States. Though some prices have increased, substantial price increases will hit in 2013 according to the USDA Economic Research Service (http://www.ers.usda.gov/data-products/food-price-outlook/summary-findings.aspx).
Increases are expected to be 3.0 to 4.0 percent. This cost increase is another $8,400 per $1 million in sales with 80 percent food sales mix and a 30 percent food cost. Beverage pricing will continue to feel pressure as well. Implement these recommendations to avoid falling victim to inflation pressure:
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Q: Minimum wage is set to increase again. I feel the squeeze of financial obligations already. How can I overcome another increase in expenses without any foreseeable benefit?
A: Washington boasts the highest statewide minimum wage in the nation and, because of a voter approved measure, is one of only 10 states where minimum wage can increase annually based on the federal Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). As a result, minimum wage will normally increase each year. Over the last five years Washington state’s minimum wage has increased nearly $1.00 per hours and approximately $0.50 in the last two years.
The financial impact in undeniable. For every $1 million in sales, restaurant operators will lose about $2,000 to the increase the minimum wage.
To combat these increases in cost, consider the following:
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