Salad days are over: ‘Lunchflation’ figures show big price hikes for UK restaurants Data from software company Square reveals a growing trend of inflated lunch items across UK hospitality. Written by Helena Young Updated on 17 April 2024 Our experts We are a team of writers, experimenters and researchers providing you with the best advice with zero bias or partiality. Written and reviewed by: Helena Young Lead Writer Our independent reviews are funded in part by affiliate commissions, at no extra cost to our readers. Research has highlighted the surge in product prices amongst hospitality businesses, as the cost of living crisis hits new heights for SMEs.The data from digital payments and tools provider, Square indicates that cafes and restaurants in the UK have introduced notable price hikes over the last year.Some food items, such as soups and salads, have increased by as much as 36% and 34% respectively.The consumer price index (CPI) inflation soared to 9% in April as a result of rising gas and electricity prices. This is the CPI’s highest level for more than 40 years, and has led to a surge in prices across the UK supply chain. Olga Sipcenoka is founder of Per Tutti, a family-run and award winning Italian Restaurant based in Hertfordshire. Sipcenoka comments: “As a family-run business, we can definitely feel the impact of skyrocketing inflation on our performance and bottom line.“Suppliers call every week with new price increases, which is worrying and stressful in equal measure.” Cheap as chips?The Square data has further broken down the new trend of “lunchflation”. The results reveal a significantly higher increase amongst food items than the UK’s current rate of inflation.Here are some of the lunchtime items that have soared in price year-on-year as of March 1st 2022:SoupsSaladsBurgersWrapsSandwichesLunchflation rate:36%34%28%21%20%Food for thoughtMuch has been said about the return of office workers in the UK, following almost two years of work-from-home policies during the COVID-19 pandemic.Square’s figures raise many questions as to how this will affect the hospitality sector in the long-run.Many will likely be forced to pass on rising costs to consumers at a time when trading is still returning to normal. Sipcenoka is fighting hard to avoid putting up costs for Per Tutti’s customers:“We have not increased our prices as we have to be in line with our local competitors including some very big chains, but how long will we be able to swallow the extra cost without passing it onto the customer?“Profits are shrinking at the same time as the cost of living is increasing, including petrol and supermarket shopping. We are a family of five and it’s really worrying.” As well as contending with rising transportation and supply chain costs, the hospitality sector is also facing a labour shortage.The latest government figures show that the number of vacancies in the hospitality industry between February and April 2022 was 171,000. That’s an increase of 296% year-on-year. In a press release, Kaushalya Somasundaram, Head of UK Payments Partnerships and Industry Relations at Square, said: “The increased price of lunch is due to the rising costs faced by restaurants, who’ve seen everything from staff salaries to ingredients become more expensive.” For alternate ways to save money in your business without raising prices, read our guide on how to budget in the current cost of living crisis. Startups.co.uk is reader-supported. If you make a purchase through the links on our site, we may earn a commission from the retailers of the products we have reviewed. This helps Startups.co.uk to provide free reviews for our readers. It has no additional cost to you, and never affects the editorial independence of our reviews. Share this post facebook twitter linkedin Tags News and Features Written by: Helena Young Lead Writer Helena is Lead Writer at Startups. As resident people and premises expert, she's an authority on topics such as business energy, office and coworking spaces, and project management software. With a background in PR and marketing, Helena also manages the Startups 100 Index and is passionate about giving early-stage startups a platform to boost their brands. From interviewing Wetherspoon's boss Tim Martin to spotting data-led working from home trends, her insight has been featured by major trade publications including the ICAEW, and news outlets like the BBC, ITV News, Daily Express, and HuffPost UK.