Wouldn’t it be nice to see exactly where you food costs have gone up?
And on top of that, it would be helpful to see if what you’re paying is similar to what other restaurants are paying… if you’re getting fair market price, in other words.
Well, you’re in luck…
We analyzed over 357,000 purchases from invoices submitted through the Orderly App from April 1 – 30.
Our goal? To find the areas of biggest prices increases. And, boy… did we find them.
In fact, one area that showed the most dramatic price increase in such a short time period was produce. So we pulled the Top 5 Movers for Produce to give you a peek into what’s happening.
The following graphs show you the starting and ending prices for each item.
You can also see what most restaurants in our system are paying for the items (50th percentile) compared to the rest of the restaurants we track (20th percentile).
So you’ll get a pretty good overview of market pricing… and how you compare.
Let’s dig into the numbers…
Mover #1 – Iceberg Lettuce
The top offender when it comes to produce movers in the month of April is ICEBERG LETTUCE.
Let’s take a look…
From these numbers, you can deduce a couple of things…
- Overall, most restaurants are paying on the high end for iceberg lettuce (50th percentile).
- BUT… the difference between what most restaurants pay (50th percentile) and what a smaller amount of restaurants pay (20th percentile) isn’t that big.
- Most importantly… the price has increased dramatically.
For the majority of restaurants, prices have risen a whopping 95% from $1.28 to $2.50.
For the rest of the restaurants we track (20th percentile), prices have gone up 86% from $1.07 to $1.28.
What this means is that if you’re buying lettuce by the head, you may want to consider switching over to purchasing by the pound or trading it in favor of another kind of leafy green.
Mover #2 – Cucumbers
The next biggest increase in produce comes from another common ingredient… CUCUMBERS.
Similar to our lettuce numbers, we can see that…
- Most restaurants are paying on the higher end for cucumbers.
- The price increase doesn’t look as steep as lettuce… but don’t let the pretty chart fool you. It went up quite a bit.
For most of the restaurants we track, prices increased 36% from $.92 to $1.25.
And for everyone else, they went up 56% from $.61 to $.96.
This situation doesn’t just call for ditching the cucumbers until prices go down again. If your cucumber prices fall into the 50th percentile, it means an opportunity to reach out to your supplier to have a frank conversation.
After all, consider the 20th percentile of restaurants… at the end of the month their prices increased, too. Yet they’re still paying only a few cents more as the 50th percentile was at the beginning of the month.
Are market prices going up… or are you just not getting a fair price?
Mover #3 – Asparagus
Number three on our list of top produce movers for April is ASPARAGUS.
What’s interesting about asparagus prices is…
- The price increases are paralell… in fact, ALL restaurants saw a 31% increase on this vegetable over the course of April.
- Most restaurants (surprise, surprise) pay on the high end for asparagus.
- Overall, asparagus is dang expensive. The starting price for restaurants paying the lowest prices was $2.12 per pound… that’s way more expensive than most of the ending prices on this list.
For most restaurants, the cost of asparagus increased from $2.36 to $3.10.
For everyone else, prices went from $2.12 to $2.78.
So what does this mean?
First, the fact that the percentage increase was exactly the same may just signal that this crop’s price is just going up in general.
Asparagus season is late May – early July. This could just be the beginning for this price increase.
That and the fact that it’s one of the more expensive vegetables you buy should signal you to be extra careful about watching for price increases every time you order.
If it’s on your menu over the next few months, consider eliminating another high-priced ingredient until the season is over. Your budget will thank you.
Mover #4 – Leeks
LEEKS are next on this list as the 4th largest produce mover in April.
Here we can see that…
- A large percentage of restaurants are paying significantly more for leeks than they should be… it’s almost a $.50 difference between what the 50th and 20th percentiles are paying.
- The trend lines increased almost the exact same amount… 22% for most restaurants and 28% for everyone else.
For most restaurants, the cost of leeks increased from $2.04 to $2.50.
For everyone else, prices went from $1.54 to $1.97.
The close percentage increase in price of leeks may point again to the fact that the prices are going up in general. But if your prices fall into the 50th percentile area, you’re still paying more than you shoud be.
If leeks are a staple item on your menu, it’s worth your while to reach out to your distributor and negotiate lower pricing.
Mover #5 – Cilantro
Rounding out out list of top 5 produce movers for April is CILANTRO.
What can we learn from cilantro price increases?
- As with our other movers… there’s room for improvement on prices when it comes to what most restaurants are paying. Sure… $.10 doesn’t seem like much of a stretch ($.39 vs. $.51)… but why shouldn’t you be paying on the lower end?
- However, the increase for most restaurants wasn’t as steep as for everyone else… only 18% compared to 27% in the 20th percentile.
For most restaurants, the cost of cilantro increased from $.43 to $.51.
For everyone else, prices went from $.30 to $.39.
The fact that cilantro prices didn’t increase as dramatically for most restaurants buying it may mean that this is a once-and-done price spike.
But there’s no telling… which means you should keep an eye on your own cilantro prices and ask for the lower end of the price range from your distributor.
Take Action Now to Save Money on These Movers
If these 5 produce movers caught you off guard, don’t despair.
There are a few next steps you can take…
- Look at your own prices over the course of April on these produce movers… these only represent an average, and your prices could have increased even more.
- Dig into the numbers on your most-purchased items – not just produce – to see if prices have increased.
- Perform a Quarterly Business Review with your suppliers… negotiate lower prices on items you order the most or that you are paying on the high end of the scale for.
If these stats prove anything, it’s that food prices can go up FAST in a short period of time.
And it’s important for you to be constantly looking at the numbers… so that you’re not paying more than you can afford.
Get Price Trends on Key Ingredients
At Orderly, we know managing food costs & pricing isn’t easy. You’re always wondering… am I getting the best deal?
The Restaurant Food Index is your answer.
The RFI compiles price data from hundreds of thousands of actual restaurant purchases made over the last month and shows you the top 25%, bottom 25%, and average 50% of prices being paid by restaurants on 100 of the most popular food ingredients nationwide and in your region.
Start by downloading the April 2017 Restaurant Food Index that features the Top 5 Ingredients for that month.