Olive Garden, Red Lobster to Raise Prices.

17 09 2008

Shouldn’t come as much of a surprise to anyone.  The Olive Garden and Red Lobster are having to raise prices to stay profitable.

The company said its menu prices at Olive Garden and Red Lobster have typically gone up between 2 percent and 3 percent each year, with price increases usually falling in the middle of that range. But for 2009, Darden said it will have to raise prices by a percentage closer to the high end of that range.

“It’s not a dramatic increase,” said Chief Operating Officer Drew Madsen. “But it’s a little more pricing than we have taken in the past.”

Darden said the economy — specifically higher costs for food, energy and labor — is to blame. Most restaurants have been pressed by significantly higher costs in the past year with prices for grain and meat rising to record levels and state and federal governments boosting the minimum wage for workers.

 I don’t eat at either.  My mom looooooves Olive Garden though.  It just one of those unfortunate trends.  Not even the chains are immune from the higher prices that cause the mom ‘n pop shops to struggle.

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Have Food Prices Peaked?

30 05 2008

I was forwarded an Associated Press article that says food prices have probably peaked.

PARIS (AP) — World food prices are set to fall from current peaks in the coming years but will remain “substantially above” average levels from the past decade, a report said Thursday.

……..

Despite the price hikes, general price levels have remained “remarkably stable,” suggesting that inflation in the coming decade will “remain low,” the report says.

Compared with the previous decade, the report said average prices over 2008-2017 for beef and pork should rise 20 percent; sugar around 30 percent; wheat, maize and skim milk powder 40 to 60 percent; butter and oilseeds more than 60 percent; and vegetable oils over 80 percent.

That’s not really comforting, but the report was really about world food prices, not just US food prices which have seen a spike recently.  What the story is saying is food prices should begin falling in the coming months, but we’re not going to see them fall to what they were five years ago.  Still, it’s a little bit of relief.