TOKYO – In the midst of a price rush as raw material and transportation costs soar, some restaurant chains and food manufacturers are trying to hold or even lower the prices of their products, hoping to expand the number of stores and increase sales by giving customers a sense of value.
Employees come up with ideas
“The challenge of not raising prices.” At a store of the Chateraise confectionery chain in Sakuradai, Aoba Ward, Yokohama, several signs inform customers that the store intends to keep the prices of its products unchanged, at least this fiscal year. For example, cream puddings and cream puffs will remain at ¥108 each including tax.
The cost of wheat flour, a raw material for confectionery, has increased by around 20% since last year, while the prices of fats and oils have increased by around 50%. Given the situation, the chain implemented a program in January in which employees are asked to come up with cost-cutting ideas, and they are rewarded based on their contribution. Up to 500 proposals per month have been received, according to the company.
By July, the operator had cut costs by more than 400 million yen per year, for example by replacing plastic cake trays with paper trays, thereby reducing the cost by about 8.5 million yen per year. year. These efforts have enabled the operator to maintain product prices.
The operator of family restaurant chain Saizeriya Co. did not change the prices of its standard dishes during its menu renewal last month. While the operator plans to reduce the cost of utilities by installing solar panels at its plant next year, it concluded that “there will be no need to raise prices”.
Issei Horino, Chairman of Saizeriya, said, “We would like to absorb the deterioration in earnings through various improvement measures.”
Mos Food Services, Inc., which operates the Mos Burger burger chain, has kept the White Mos Burger priced at ¥790 if ordered as a set, which includes a soft drink and an “edamame corn” side dish. fry”. That’s up to ¥260 cheaper than when the same menu items are ordered separately.
“By selling them in batches, we benefit from economies of scale when buying food,” said Yoshinori Ando, senior manager at Mos Food Services.
Next Meats Co., a venture company that treats plant-based meats, such as soy-based meats, as alternatives to pork and the like, slashed wholesale prices for its products by about 30% in April.
When the company started in 2020, it used small-batch production. But by increasing his production, he increased production efficiency and was able to achieve price cuts. “It’s the right time when the price of meat goes up,” a public relations official said.
In the face of these changes, an official from a major food manufacturer said, “Our rival companies who manage without raising prices through their commercial efforts would make it difficult for us to raise prices.” Another manager of a large confectionery chain which raised prices said: ‘We would be very disturbed if such price reduction measures were taken. [by our rivals] one after the other.”
As upward pressure on prices intensifies, companies’ efforts to better deal with it are likely to continue in the days ahead.