Puerto Rico restaurants juggle price hikes, reduced hours to deal with rising costs
A study released by the Puerto Rico Restaurants Association (ASORE, in Spanish) showed that 96% of local eateries hiked their menu prices in the last 12 months to mitigate the seemingly non-stop increase in operational costs.
The trade group released the “Proyecciones 2022” study, commissioned to research firm Inteligencia Económica, which surveyed more than 100 restaurants, including casual dining, fine dining, quick service, coffee shops and bakeries. About 40% of them have multiple locations.
The report was released at a time when restaurant owners are feeling the effects of the pandemic, in addition to the impacts of an inflationary economy, worker shortages, increases in operating costs, and a fragile supply chain.
The report revealed that most restaurant owners and operators have resorted to various tactics to mitigate different issues, including increasing menu prices in addition to cutting back on the number of employees hours and expenses such as marketing.
Among the most pressing obstacles for restaurants are Puerto Rico’s record-breaking inflation, which stands at 5.1%, recruiting and retaining employees, paying for salary increases, and implementing on-the-job flexibility. The study shows that over the past six months, labor costs have increased by 17.3%.
Some 70.6% of those surveyed said they are dealing with as much as a 30% staff shortage, even though Puerto Rico’s employment levels continue to grow.
“We live in extraordinary times, without a doubt. And that’s why it’s imperative to take a closer look at the current state of the restaurant industry,” said Mateo Cidre, chairman of ASORE’s Board of Directors.
“It’s also an opportune time to gauge the prospects of businesses. With this study, we clearly see where we are and what the expectations are for the future,” he said.
Puerto Rico’s restaurant industry had 4,144 establishments in 2021, up slightly from the 4,010 on record for 2020. Last year, the sector generated more than 59,000 jobs, which also reflected an increased when compared to the 52,000 reported for 2020.
“Being part of this industry is navigating these situations as part of the business. So, at ASORE we seek to move from reacting to crises and unforeseen situations to acting proactively, always for the sake of development and progress,” said Cidre.