Eating out gets costlier: Few days left before Pune restaurants hike menu prices

“We were already reeling from the price of commercial LPG, which had increased to more than Rs 3,000, when the hike in petrol and diesel prices was announced. We don’t want to risk our reputation by having customers say that, whenever we are given a chance, we increase the prices. We are trying to be patient but, if things don’t improve, we will have to increase the price eventually. At the moment, we are taking the blow,” says Barve.

Across the city, popular hubs of eating-out are tinkering with menu engineering, in terms of prices, portions and dishes. Low-performing dishes are being taken away and kitchens are experimenting with processes. Ganesh Shetty, president of the Pune Restaurants and Hoteliers Association, calls it a “wait-and-watch time”  to see how much prices will escalate. “Everyone is talking about increasing prices but we are waiting. Our vendors have increased prices by 2-5 per cent but are saying that this will go up further. As the cost of our raw material increases, we will adjust our prices,” says Shetty. He adds that transport costs will be a major determinant in the eventual prices on menu cards.

“When the transport cost increases, the prices of all products in the market will go up. Pune might get its onions, potato, tomato and other vegetables from surrounding areas but food grains are still delivered on trucks from the north and south of the country. What we do not know is by how much transporters will hike rates,” says Shetty.

On Sunday, Spring Onion, a popular restaurant serving “asian and more”, held a long meeting on the increased financial pressures. It was attended by the the owners and senior chefs of the restaurant’s outlets at Bhandarkar Road, Dhanori, Hinjewadi and Baner. When the cost of commercial LPG started being offered at grey market rates of Rs 7,000-8,000, Spring Onion had to increase its prices. It had, famously, put up a sign about the price hike that the guests could see before they entered. When the cylinder prices came back to normal, Spring Onion brought its menu cost back to normal.

“Now, again, the cost of LPG has moved to more than Rs 3,000. We are reworking our pricing strategy. We will try to ensure that it is the best midway for us and the clients, that prices are not way too high. The final pricing is not yet in place, but we will be completely honest with our customers. We will let them know that we will be increasing our prices. Survival is of utmost importance and, surely, in such difficult times, our customers will understand and support us,” said manager Sujit Tabib, manager of Spring Onion.

He added that restaurants are in a precarious position because they “do not want customers to feel the pinch on their pockets”. “People want to go out and eat and enjoy with their families and friends. I would love them to come to our place, experience the ambience and pay reasonably for this,” says Tabib.

According to Saili Jahagirdar, the head of the Pune chapter of the National Restaurant Association of India (NRAI), “everybody is increasing rates”. “I don’t know a single local restaurant who has not done a rate revision in the last month,” she says. Last week, she sat down with her team at Zillionth Bistro, and did a price revision. Zillionth Bistro has made minor increments of Rs 20-25 because they are also trying to remain competitive.

Jahagirdar cites the example of Thai curries, which need coconut milk, whose rates have sharply increased by 20 per cent. One kg coconut milk dabba would make five portions at the restaurant. “Only with the coconut milk, the price per dish has gone up by Rs 15. I am not even counting the vegetables, oils and spices,” she says.

“A lot of big chain restaurants, who are funded and are pan-India, have not done a rate change yet. They are studying the market and have the funds. They also, probably, want to check the advantage of having lower rates than the local restaurants. Local restaurants have to work with that as well,” she says.

Jahagirdar adds that, while many restaurants might not survive the test of the expensive menus, the standalones with a loyal customer base would be alright. “Eating out at a good place on a good occasion is one of the things we work for. People are likely to keep going to the restaurant where they have had a good time before. Restaurants, too, are aware of this while calculating the price hike that is fair to everybody,” she says.