“Market Price” In Restaurants Is Mostly A Sham

September 15, 2017 in Daily Bulletin

Ever seen “MP” listed on a menu instead of the actual price? It’s probably a trick, wrote Kate Krader:

  • Shielding diners from prices on menus began with freshly caught seafood. Supply is erratic and prices can swing between extremes, making it difficult to print a set price on a menu.
  • But chefs liked the air of exclusivity it added to menus and so began to use the label on their proudest creations.
  • Hiding prices also helps prevent sticker shock and artificially lowers the average menu price, making it more popular on sites like Yelp.
  • This is just one strategy that restaurants have pursued to improve margins. Overall restaurant food prices rose 2.6% last year, while the cost of ingredients fell 1.3%.

Read more on Bloomberg.