Restaurants across the United States have been dealing with inflated food costs and higher wages for workers. Now, restaurant chain Chili’s Grill & Bar is joining a host of restaurants enacting an increase on menu items and delivery food to help balance inflated food and labor costs.
The CFO of Brinker International Inc., the parent company of Chili’s, announced that the restaurant would raise its prices by mid-November.
The raise is to be on average of 3%.
According to research by the National Restaurant Association’s chief economist Bruce Grindy, the national price increase average between September 2020 and September 2021 is 4.7%. This places Chili’s 3% bump below the national price increase average.
The expected price increase at Chili’s will be the restaurant’s third time this year it will increase prices, with the company saying it’s the restaurant’s strategy to balance out supply-chain challenges such as higher costs of food.
It is also meant to cover up for the cost of higher wages for workers and a lack of delivery drivers.
Vice president of restaurant development, finance, and investor relations at Brinker International Inc., Mika Ware, said that the hike in price is a thoughtful one as it keeps “our value proposition top of mind.”
Ware also revealed that the increase isn’t a rigid one. “That 3% doesn’t mean when you go into Chili’s, you see a 3% menu price increase,” she explained. “You might see a lower percentage of higher-priced items on the menu and more put into other channels, like third-party delivery.”
The CEO of Chili’s, Wyman Roberts, said the past quarter was challenging, explaining that their business difficulties are not traffic and sales but rising running costs. He said that the company has to increase prices to meet the rising costs of food and labor.
“After 40 years in this business, I’ll take managing costs over searching for sales and traffic any day,” said Roberts. “Those are good problems to solve because they’re largely within our control.”
Brinker operates nearly 1,600 restaurants across the globe, 212 being in Texas.
