So, what strategies should restaurants adopt to make customers willing to pay more?
Who should pay attention to the price of restaurants?
In the course of restaurant operation, we found that some restaurants choose to raise prices, some restaurants keep the original price, and some restaurants choose to reduce prices.
So, in such a chaotic price competition, should restaurants raise prices?
Shen believes that restaurants must understand clearly before deciding whether to raise prices. What is the pricing standard of the restaurant?
Interested readers can refer to the article "Traps in Restaurant Pricing Strategy"-low! Low! Lower it! Natural eggs? 》。
When considering pricing, many restaurant owners like to refer to the prices of their peers and adjust them up and down around the price range of their peers to maintain the competitiveness of their restaurants.
At first glance, this method is ingenious and easy to operate. However, this is indeed a pricing method that puts the cart before the horse.
From the normal business logic, the main factors that determine product pricing are the operating cost and profit ratio of restaurants.
In actual operation, different restaurants need to pay different operating costs for the same product with the same quality. This is mainly reflected in the supply chain and product management.
Secondly, the different positioning strategies of restaurants also determine the pricing logic of dishes. Ok, for example, grandma's mapo tofu is 3 yuan each. The low price strategy of this product mainly plays the role of attracting passengers.
Therefore, cost orientation and demand orientation are the strategic direction of restaurant pricing, and they are also the fundamental factors for restaurants to decide whether to raise prices.
Why don't some restaurants raise prices?
The rising operating costs, such as raw material cost, store rent and labor cost, make the price increase of restaurants an irreversible trend.
However, in the face of this trend, some restaurants have chosen not to raise prices.
What is the logic here?
1) Profit to consumers
Wansui Sushi, founded in 1999, is one of the earliest sushi brands in China. At present, Wansui Sushi has spread all over the country in more than 20 provinces, with more than 100 branches.
/kloc-For 0/8 years, no matter how the market changes and the purchase price is high or low, the golden salmon of Viva sushi has always been sold at the price of 46 yuan.
In this regard, He Rongwan, managing director of Viva Sushi, said that such a strategy has certain pressure on the operation of the restaurant. In most cases, restaurants often need to post for this purpose. However, Viva Sushi still insists on selling this product continuously 1 year for 365 days. In He Rongwan's view, instead of spending a lot of marketing costs to drain, restaurants might as well save marketing costs and give them back to customers.
2) Strictly control operating costs.
Franco Manca is the most popular fast casual pizza chain in Britain. Most consumers believe that the most important factor that attracts Franco Manca is excellent cost performance.
However, Franco Manca is not a restaurant brand that won the world only by low price. In fact, Franco Manca's ingredients and cookers are not cheap. At the same time, Franco Manca's pizza tastes good, and the interior design of the restaurant is also very fashionable. It can be said that Franco Manca provides the best service for consumers in the same price range.
So, how does Franco Manca control operating costs?
In order to maintain the quality of dishes, Franco Manca chose to save space to keep the price low. Restaurant decoration is relatively simple and materials are cheap.
At the same time, the restaurant area is basically below 100 square meter, and most stores control the rental fee below 5% of gross profit, which is very light compared with competitors starting from 200 square meters to 300 square meters. In addition, Franco Manca has made great efforts in turnover rate and production efficiency to ensure the income and profit of the restaurant.
How to make the price increase acceptable to customers?
In most cases, in the face of rising operating costs, price increase is a common means for restaurants to maintain profitability.
So, how can restaurants skillfully raise prices and make customers pay the bill willingly?
To this end, Shen sorted out several popular price increase methods in the industry at present.
1)PI value price increase strategy
In the middle of this year, Haidilao Zhengzhou Store adjusted the prices of some products. Some have increased by a few dollars, while others have increased by more than ten dollars. However, most consumers did not feel the obvious price increase after eating it. Why?
This is because the price of Haidilao is adjusted according to two factors: PI value and price elasticity coefficient. PI value, also known as thousand people purchase rate, can also be called commodity purchase index, commodity popularity or commodity aggregation index.
The relationship between PI value and price sensitivity is very close, and goods with high PI value are price-sensitive goods. A high PI value indicates that the product is highly concerned by customers and frequently purchased. This commodity will form a fixed price range in customers' minds, and a slight change in commodity prices will attract customers' attention.
The PI value of commodities is often inversely proportional to the pricing and gross profit margin of commodities. That is to say, among similar goods, the higher the PI value, the lower the pricing and the lower the gross profit margin of the goods; Conversely, the lower the PI value, the higher the pricing and the higher the gross profit.
Before the price increase, the unit price of Haidilao in Zhengzhou was basically 70-90 yuan, and after the price increase, it was basically in this range. This operation can reduce the psychological gap of customers.
2) New product iteration strategy
Making consumers willing to pay for your products is the core issue to improve the profit rate of restaurants. For restaurants with research and development capabilities, pushing new products is a good "indirect price increase method".
In consumers' cognition, different categories of products correspond to different consumption power. This concept limits the price increase and bargaining space of many restaurants, and limits the profitability of restaurants to a range. In order to improve this situation, Kao will introduce explosive products with high profits to replace the restaurant's inherent products, such as sushi. According to Lv Qiang, founder of Kao Store, the iterative operation mode of explosive products is more acceptable to consumers than simple and rude price increase.
3) Combined packaging strategy
Under the package combination of fast food restaurants, many consumers may not even pay attention to the original price of a single item at all.
In many Chinese restaurants, it is possible to establish a relationship between any two dishes in the restaurant: the customer's order is a combination of several dishes, which seems to draw a line on the network structure, which is exactly the product line that the restaurant needs to prepare meals for customers.
Therefore, the pricing of restaurants should not consider the price of a single product in isolation, but the price of a product line that prepares meals. The way of package pricing can blur consumers' concept of price to a certain extent, and can also narrow consumers' psychological gap.
Price increase is an important means for businesses to ensure profitability, and it is also a dangerous attempt.
Once there is a mistake in the process of price increase, it is easy to cause the loss of customers, and the previous accumulation is all in vain. If this step is successfully crossed, the store will enter a virtuous circle.
At the same time, the price increase is also a process of precipitating loyal customers.
Original statement: this article is original for the catering industry, please indicate the source, and offenders will be held accountable according to law!