Editor’s letter: Planning for 2024
November 29, 2023
By Colleen Cross
As you enter the festive season, with production in full swing, showcases bursting with eye-catching scented delights and optimism high, we know behind it all there is concern.
It’s a perfect storm for dine-in bakery-cafés and restaurants at the moment.
A rough economy is discouraging folks from visiting their favourite eateries. And when they do venture out, higher menu prices – necessitated by high labour, ingredient and rent costs for operators – are conspiring to put a damper on their experience.
The Agri-Food Analytics Lab at Dalhousie surveyed 5,521 Canadians to gauge their perspectives on the food-service industry and how food inflation is affecting their views.
Here are some highlights from the study:
- 80% of respondents said that higher menu prices have influenced their dining-out choices.
- 88% have said they are dining out less due to higher overall food prices compared to 2022.
- 77% now predominantly choose more affordable dining establishments due to price hikes.
- 29% of respondents expressed being either very satisfied or satisfied with their restaurant experiences based on the money they spent.
- 68% have observed that portion sizes at restaurants have notably decreased compared to a year ago, a phenomenon known as “shrinkflation” within the food-service industry.
Sylvain Charlebois, director of the Agri-Food Analytics Lab, remarked on the survey findings: “Expectations have clearly changed. This survey underscores the profound impact that rising menu prices and food inflation are having on Canadian consumers’ dining habits. It’s a wake-up call for the entire restaurant industry, signalling the need for innovative strategies to adapt to these changing consumer preferences and economic challenges.”
The last thing we want to do is put a damper on your holiday spirit – of which there is no shortage as you’ll see from our feature “Holiday bakery tour” in this issue.
But you should be aware of some of these findings as they may help your planning for 2024.
The report gives us a lot to think about. For example, it confirms that customers notice “Shrinkflation” and they don’t appreciate it. We know because we’ve all seen it happen on grocery store shelves. Your customers and clients come to you for your high-quality baked goods and will surely notice any reduction in quality.
If there’s a compromise to be made, it’s better to reduce the variety of products or number of hours you are open rather than reduce the size or quality of your signature croissants, bagels, cakes, cookies, breads, pastries and chocolates.
Raising prices is tricky but necessary for businesses with such tight margins. It’s important to stand behind the quality and work that goes into your one-of-a-kind products. Loyal customers want to support your business and clear, regular communication with them can go a long way in keeping them motivated to visit and promote your business.
As bakers with deep knowledge and training providing highly specialized products, you have a built-in advantage for those ready to indulge without looking too closely at prices. But whether it’s a sit-down lunch, a quick croissant and cappuccino to go or ordering a cake or platter ahead for a Christmas or birthday party, it’s still an experience to be savoured and people still expect value for money.
Our wish for you is a busy, yet manageable, holiday season, and a more stable, profitable 2024.
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