Tuesday, November 29, 2022

Oxford restaurants adjust to inflation, other pressures by raising prices

By Jonathan Briggs

Journalism Student

jpbriggs@go.olemiss.edu

In response to nationwide increases in food prices due to inflation, supply chain disruptions and spikes in energy costs, Oxford restaurants are adapting to the changing environment by raising menu prices.

According to the U.S Bureau of Labor Statistics, the Consumer Price Index for food rose 11.4% from August 2021 to August 2022. The CPI for “Food Away From Home”—which includes both “full service” and “limited service” restaurants—rose 8% in the same period. 

For Oxford business owners, these price hikes are far more than statistics; they add even more pressure to running a restaurant during a national labor shortage

 “Every restaurant probably has had to raise prices a little bit,” explained Chris Stephenson, one of the co-owners of Oxford Burger Co, a restaurant that sits right where Jackson Avenue meets the Square. 

The restaurant has been forced to raise its menu prices since the pandemic, which caused seemingly everything to increase. “We’ve had a price increase since the pandemic, in the past year and a half,” Stephenson said.

He explained that each month sees a new product that goes up, largely due to supply chain delaysi caused by the COVID-19 pandemic.  

“It has been different each month,” said Stephenson.“This month potatoes have gone from $30 a case to around $60 a case, so they’ve actually doubled.”

Chad Jennings, owner of OPA!, one of Oxford’s newer restaurants, expressed similar sentiments. 

“We’re kinda stuck absorbing it,” Jennings said. “In the past maybe you got free dressings or things like that, you’re really forced to pass it along to the consumer, but when chicken prices triple, you know, you can’t pass all of that along.

“People just aren’t going to pay $20 for a chicken sandwich,” said Jennings, who, prior to opening OPA! eight months ago, spent five years in food services. 

Along with restaurants, University of Mississippi students have experienced the price increases firsthand. 

 “When I first got here over the summer, for my vegetarian dishes, it was $12 a dish. Then it was 14, and now I think it’s even 16,” said John Henry Amburgy, referring to the restaurant Maharaja Indian Cuisine. 

Jennings said that most of the price increases come as a result of inflation affecting the costs of everything from labor to food transportation. “The manufacturers have gone up on pricing,” he said. “The distributors, whether it’s SYSCO or US Foods or PFG or even local purveyors, whoever you buy your groceries from, have had to raise their prices.”

Still, rising food prices do not mean that restaurant profit margins are growing as well. “Right now the national average for a full-service restaurant is about a 3-5% margin… 10 or 15 years ago that number would’ve been closer to 20 or 25% if you did a good job managing your costs,” Jennings explained. 

Transportation costs and supply line issues have only added volatility to the food industry. Stephenson of Oxford Burger Co. said many producers did not adequately plan for supply chain disruptions, which have caused shortages and price hikes of different goods on an almost monthly basis. 

The Taco Shop also recently updated its menu prices. Located in a plaza off University Avenue, the Taco Shop is a longtime favorite of students and others on tight budgets. 

Currently, its tacos cost about $2 apiece, while old menus show previous prices of $1.75 a taco.   

Ole Coop, an Oxford wing restaurant, also has raised its prices, notifying customers through a printed notice posted near the business’ cash register. An old menu from the restaurant shows 8-piece traditional wings costing $8.79. On Ole Coop’s updated menu, 8-piece traditional wings cost $10.59, a price increase of about 20%. 

“I thought it was quality food for a good price, and when I went recently I thought I would get the same deal,” said Alex Canterbury, a junior from Birmingham, Alabama. “Then I got there and saw that sign. I’ll be eating out less often. You go to these places because you want a cheap meal.”

With rising costs nationally, the moves by the Taco Shop and Ole Coop are hardly unexpected. Recently, a report from the National Restaurant Association said 91% of restaurant owners and operators surveyed raised their prices, while 16% placed additional charges to patrons’ checks.

Despite the price hikes, restaurants like Oxford Burger Co. are turning their attention to customer service in order to ease backlash. “People go out to eat no matter the price,” said Stephenson. “They go for the atmosphere, and we try to provide an experience to match the price.”

It is unclear, however, how students will continue to adapt to the changing economy. 

 “I don’t have unlimited money,” said Amburgy, a freshman from Ocean Springs, Mississippi, “so I have to be super conscious, especially when I’m out, off campus. If I’m driving around campus and I want to eat, I don’t want to spend money.’’


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