The Effects of Inflation on Restaurants and How to Combat Decreased Demand
3 Min Read By Matt Lukosavich
While 2021 was the year of the comeback for restaurants, 2022 is proving to be a very different story. Record-high inflation is hitting consumers from every angle – gas, groceries, rent – and restaurants tend to be the first place they cut spending.
Restaurant traffic, while recovering and up nine percent in 2021 compared to 2020, is still 4 percent below pre-pandemic levels, with smaller chains and independent restaurants down by nine percent, according to a study by The NPD Group.
The lingering pressure from inflation – with no end in sight – is starting to shift consumer behavior in meaningful ways. Substantial price hikes on restaurant menus are causing consumers to choose other options aside from eating or taking out, and a ‘tipping point’ is on the horizon where inflation will depress overall demand. In fact, research from Vericast’s recent restaurant report indicates that 60 percent of consumers feel that rising prices have already made eating out too…
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