Price hikes hit food industry

MONTROSE  — Remember when a box of potatoes cost $19? It was only six months ago.

“Now they are $35 for a box, and they are in season,” said Eric Scott, owner of Cafe 110 in Montrose.

Everyone is feeling the effect of increasing prices, from fuel surcharges on products to the products themselves.

“It goes in circles and it goes up and down with everything,” said Edward Garcia, manager of family-owned Amelia’s Hacienda Restaurante in Montrose. “It’s everything across the board.”

Scott said he’s seen many of his products’ prices increase by 20 to 30 percent.

Chris Fairchild, executive chef and general manager of the Camp Robber, said he’s seen grains increase by 10 percent and cooking oils and other products by at least 5 percent, just in the last five to six months.

“It makes it that much harder to capitalize,” Garcia said.

Garcia said it’s hard because restaurant owners have to decide if they want to increase prices, which could upset customers and keep them from spending their money there. However, the only reason those costs are rising is because his costs are rising, he said.

Scott and Fairchild said reviewing prices is something that is usually done annually. However, the cost increase in just the last six months could mean prices will need to be reviewed a little sooner this year.

“At this point we haven’t made any increases to the menu,” Scott said. “It boils down to some point, if we don’t raise prices to make the difference with cost changes, we won’t be around to serve food.”

So, if they aren’t increasing prices, what are restaurants doing?

“You tweak things here and there,” Fairchild said. However, he said his goal is to make sure the customer gets the quality of service and food they expect without the “pain of the price tag.”

Owners said they haven’t stopped buying items because of their price. However, some are changing portion sizes.

“It’s an easier way to cut costs,” Garcia said. He’s not eliminated his specialty items, which are the higher priced products to buy, because those are the reason his customers come.

“Those are what make us Amelia’s and not some other Mexican restaurant,” he said.

Another direction Scott has found himself going is buying local products. He’s found milk is cheaper at City Market, he said. He’s also been visiting Montrose Farmer’s Market for produce. His lettuce comes from Delta.

Fairchild and Garcia said they are also looking local. Garcia said he’s had trouble with produce because many crops are behind this season. Though not all local products are cheaper, they said, the quality is usually better and they feel it’s a way to support the local economy.

“Beef is a little more because they are a small mom and pop,” said Garcia about the local beef products he buys. “But you are too, so it doesn’t matter. ... you understand why the prices are going up.”

He said it’s the “you scratch my back, I’ll scratch yours” concept.

Rising prices aren’t the only money challenge for restaurants. In January, Colorado raised minimum wage to $6.85 and $3.83 for tipped employees.

“That’s an extra couple of dollars per hour per server,” Scott said. “We’re just eating those costs.”

However, Scott said restaurants aren’t the only ones taking the hit. Customers are impacted as well. He’s noticed many are cutting down on what they order, maybe drinking water instead of a soda. Fairchild also said he’s seen a decline in bottled wine sales.

Monday, Cafe 110 started opening for dinner. Scott said he put an ad in the Daily Press. In the past, he’s had to wait for potential employees to apply. However, this time he said there were about 40 applications.

“Most were part-time, people looking for second jobs,” he said.

Contact Kati O’Hare via e-mail at katio@montrosepress.com