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#CostOfLiving: Food and beverage price increases taking a huge bite

───   13:37 Tue, 26 Jun 2018

#CostOfLiving: Food and beverage price increases taking a huge bite | News Article
PHOTO: cardfellows.com

Due to general price increases, consumers are not the only ones who are bearing the brunt.


The food and beverage industry has also taken a huge knock since the petrol price hike has had a knock-on effect on food prices, which has forced suppliers to charge businesses more for their products.

The general manager at the Eatalia restaurant in Bloemfontein, Tebello Lekale, told OFM News about the various challenges they are facing as a business. These challenges include the fact that the restaurant used to have a lot more customers than they do now and that the ones who come do not spend as much as they used to. He went onto say that they run specials right through the week. They have the same special weekly and their Monday special is the most popular.

“The food cost is higher, so the prices of suppliers have also gone up but customers do not expect the food prices to increase. So that is one of the problems we have. The rent has also gone up and we now have a lot of costs. I have noticed that the people who are spending the most right now are the middle-income group,” Lekale said.

OFM News also spoke to Shane Pretorius, a restaurant owner from Ocean Basket in the Waterfront. He said some of their biggest challenges are their cost of sales, which is mainly due to the food prices that have increased. He also said that they cannot pass these costs on to the consumer because then fewer people will come to eat out. He told OFM News that they are now spending a lot more on water and electricity, as well as staff wages. He went on to say that the middle class is being squashed into the lower class due to all the increases. Pretorius mentioned various plans the restaurant has implemented to save on costs.

“We have switched to gas kitchen equipment and pots. Gas is also expensive but it doesn’t go up as much as electricity does and we need to take winter rates into account. What we do is we switch our equipment on and off, because if we use them all at the same time, we get a power surge and we get rated at that peak. So we put on one fryer and wait 30 minutes before we put on the next one," Pretorius continued.

A waiter from Eatalia, Baluleke Nkatsha, spoke to OFM News to share how he is affected by high fuel prices and how the challenges that the restaurant is facing, is affecting him as well. He said that he pays a lot more for transport now and that it has a huge impact on his budget. He stays on the other side of town and has to travel back and forth daily. He went to say that the increases are a huge problem for him as he earns a commission.

"If there are no customers, we get no tips. I earn a commission, so I rely on customers to make my money. Things have changed, the customers are tipping us less or they just stick to the 10%, whereby in the past they used to tip us more than that," said Nkatsha.


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