Discount Dining? For Savvy Diners, Anyway
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Study Shows .6% Price Drop on Casual Dining Menus Dinner Entrées up 2.2%; Alcohol up 1.7% BOSTON--(Business Wire)-- With all of the TV ads for discount entrées at casual dining chains -- not to mention recent media coverage of price cuts --consumers may not realize that it could be costing them more to dine out. According to research published by Boston-based pricing consultancy, Intellaprice, how you order off the menu will play a large part in whether you actually see a savings on your meal check. Intellaprice gathers, interprets and monitors national prices for top restaurant industry players. "We hear a lot about the deals out there because that`s what`s being advertised," says Leslie Kerr, President of Intellaprice. "Two for $20 dinner deals and discount entrées are memorable, but the reality is there`s a whole portfolio of menu items, and restaurants are strategic about managing prices in key categories." Intellaprice`s research focuses on regularly priced items - not those subject to special promotions. The findings indicate that the overall price change vs. 2008 is -.6%. Not exactly deep discounting-and this figure varies by menu category. Bar Beverage Prices Up Nearly 2% Kerr notes that the continued economic downturn has impacted trends notably. "This year, food prices overall are down by .6% and bar beverage prices are up nearly 2%. That`s compared to our 2008 finding that food prices were up 2% overall and bar beverages were up 5% vs. 2007." Categories whose average prices actually increased included dinner entrées at 2%, side dishes at 8%, and desserts at 7%. On the flip side, 2 categories were down: appetizers decreased 2%, and add-ons - items like cheese or additional proteins (bacon for example) - are down by 4%. "If you are a meat and potatoes eater, who also likes dessert, chances are you could feel the sting," said Kerr. "But if you stick to the promoted deals, or if you tend to make appetizers your meal, then you`re more likely to save some money." Kerr explained that it`s an age-old game of pricing management in hopes of driving profitability. "Restaurants feel pressure to take price increases somewhere; it seems as though they`re trying to ease sticker shock for more noticeable, popular items, and increasing prices in less noticeable places on the menu." 2009 marks Intellaprice`s third annual analysis of pricing trends in the casual dining segment. The study covers top casual dining chains in 21 markets nationwide. Nearly 2,900 beverages and 13,000 food prices are included in the sample. Other findings show that among chains surveyed, Atlanta boasts the most expensive dinner entrees, averaging $14.75, outpacing the New York, Chicago, and Los Angeles metro areas. Drinks Up More Than Food Drink prices increased more than food, which was also the case in the 2008 study. "We`ve all heard the anecdotes that bar business is impacted less in a down economy, and the findings bear this out," Kerr said. "This year, once again, the price change in bar beverages is significantly more than that for food. The most expensive drink in the study, a top shelf margarita, was the only one whose price was unchanged. Sangria saw the highest average dollar increase, up $.28 to $6.07." Relative drink price trends show continuity with last year`s study. "Guests dining out in Oklahoma City may be pleased to know that market continues to serve the lowest priced drinks vs. other markets." New York offers more highly priced drinks, with Washington DC a close second. A domestic beer costs $3.22 on average in Oklahoma City, $4.13 in Washington DC, and $4.15 in New York on average. Average Casual Dining Prices by Beverage * Domestic Draft Beer $3.72 * House Margarita $5.86 * Vodka/Tonic - Well $5.06 About Intellaprice Intellaprice is a full-service pricing intelligence firm serving the restaurant and beverage industries. Intellaprice publishes the Intellaprice Report, which is syndicated pricing intelligence on quick service and casual dining segments. Intellaprice specializes in pricing, profitability, and marketing analysis, to help organizations increase sales, grow profit, and reduce competitive intelligence costs. Intellaprice was founded by restaurant industry veteran Leslie Kerr and is based in Boston. For more information visit www.intella-price.com. Intellaprice® LLC Leslie Kerr, 617-723-7977 firstname.lastname@example.org Copyright Business Wire 2009