A restaurant has had to adapt the ingredients they use to keep costs down because of the cost-of-living crisis.
Brew and Bake is based in Preston, and they have launched a new menu recently, with the same products, but new flavours in the food itself to make their meals more cost effective.
This follows February’s inflation rate rising to 18.2% for food, which is the fastest in 45 years.
“You have to be changing the way you are doing things day in, day out otherwise you start losing customers. There are people on the outside who are now limited to what they can spend.” – Kieran Fishwick (Chef at Brew and Bake)
The cost of living could have a bigger effect on hospitality than Covid-19
Data from the new Hospitality Market Monitor from AlixPartners and CGA showed that inflation led to a decline of 4,809 hospitality premises in 2022. This is an increase of 1,461 closures from 2021 which were largely due to the Covid-19 pandemic, implying that the cost-of-living crisis may have a bigger effect.
“ONS stats show a clear correlation between the unexpected rise in inflation and inflated prices in the hospitality sector, where food and drink costs for businesses have risen by 24%. This, along with soaring energy costs, has resulted in prices for customers rising more than 12% – the highest in 30 years.” – Kate Nicholls (UKHospitality Chief Executive)
The data suggests that people may be unable to afford to eat out due to the cost-of-living crisis, leaving restaurants struggling to afford high energy prices and food inflation, and therefore resulting in their closures. The OBR also predicted in March this year that household disposable income per person will fall by 3.2% in 2023 again, implying restaurants could see a decrease in the number of customers.
The increase in food prices is not restricted to the hospitality sector. Households across the north are also struggling with the rising cost of food, and statistics from the Trussell Trust show that 252,048 people in the North West used a food bank between 1 April 2021 – 31 March 2022.
Low-income households are set to receive the first instalment of the 2023/24 cost of living payments between 25 April and 17 May from the Department of Work and Pensions which may decrease the usage of food banks in the UK however, this will not guarantee an increase in customers for hospitality businesses.
“These payments will give a financial boost to more than eight million households as we continue to wrap our arms around the most vulnerable, while the best way we can protect people from high costs is to halve inflation by the end of this year.” – Mel Stride (Secretary of State for Work and Pensions)
Luckily, Kieran (Chef at Brew and Bake) explained how they run on more of a client basis, so the business has not seen a decrease in the number of customers yet however, they are aware of the fact that people have now got a lower budget to spend on food.
Cost of ingredients
Brew and Bake said they are now limited on what food they can make, as experimental foods, such as fusion foods, have more expensive ingredients.
Even key ingredients such as oil, butter and cheese have had a huge price increase from December 2021 to December 2022 with olive oil having a 39.5% increase, cheese 32.6% and butter a 29.4% increase.
Brew and Bake said the biggest struggle they face is keeping customers interested, but changing small aspects of the menu has helped with this. Their lunch menu contains foods such as ‘rarebit’ which is a vegetarian plate and ‘buddha bowls’ with a choice of chicken, halloumi, falafel and hummus – using ingredients from local suppliers including Ribble Farm, Banana King and Holme Farm Dairies.
However, they aren’t the only restaurant to have made changes due to the increase in food prices. Other restaurants like Smokin V’s Real Barbecue in Preston have said the cost of living was the main reason for them closing down.
We may see more restricted menus from restaurants in the hospitality sector from now on, as they try to survive the rising costs.
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