Financing

Consumers are ready to cut restaurant spending if prices keep climbing, study finds

Fifty percent say inflation has already sapped their financial situations.
Photograph: Shutterstock

About two-thirds of American consumers say they’ll cut back on dining out if their financial situations should worsen, a turn that half say is already underway because of galloping inflation, new research shows.

A consumer survey conducted for ICSC, an association representing shopping and lifestyle centers, found that 39% of consumers feel their economic situation has already worsened because of soaring prices. A full 50% said the inflation is now their main economic worry.

About 82% of the respondents said they’re already spending more for groceries, and 75% said they’re paying more at the gas pump. The percentage who spend more on restaurants was not revealed.

But ICSC did note that 64% of the surveyed consumers are primed to cut back their restaurant expenditures because of rising prices—not necessarily just for food prepared away from home, but for other key goods and services.

Restaurants have reported little resistance from consumers as menu prices soared. Last month’s increase was the highest percentage logged by the federal government in 41 years.

The ICSC study suggests consumers are closely monitoring how their spending power is being eroded by inflation, and that dining out is one of the activities that will be most curtailed if inflation hits a tipping point.

Conversely, 41% of the respondents said they’d likely spend more on restaurants if their financial situation improved or the economy seemed to be strengthening.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Marketing

Older brands try new tricks in their quest to stay relevant

Reality Check: A number of mature restaurant chains are out to prove that age is just a number.

Financing

At Papa Johns, delivery shifts from its own apps to aggregators

The Bottom Line: The pizza delivery chain’s business with companies like Uber Eats and DoorDash is thriving while its own delivery is slowing. But this isn’t the beginning of the end of self-delivery, CEO Rob Lynch says.

Topics

How the shift to counter service has changed Steak n Shake's profitability

The Bottom Line: Sardar Biglari, chairman of the chain’s owner Biglari Holdings, details how the addition of kiosks and counter service has transformed restaurants.

Trending

More from our partners