Cost of eating out rising faster than inflation according to survey

The cost of eating out has risen faster than inflation and reached a record high, as restaurant and pub operators try to maintain margins.

New research from Horizons covering menu trends at 115 hotel, restaurant and pub brands, found that the average price of a dish rose by 7.5% during 2010 to £6.78.

This above-inflationary price increase has largely been on main courses, rather than starters and desserts. The price of an average has risen to £5.12 (+ 0.2% year on year), a main course now costs £9.63 (+ 7.3%) and a dessert £4.29 (+ 3.1%).

Horizons' Menurama survey also found that the average price of a three-course adult meal had risen to £18.94 in 2010, up from £18.03 in 2009 - a 5.1% rise year on year.

A three-course meal in a restaurant rose 2.8% to £20.92, while the average cost of a three-course meal in a hotel is now £26.26, up 3.8% year-on-year.

The fastest prices hikes have been in pubs, with a three-course meal now costing an average of £15.45, compared with £14.85 (+4.1% year on year).

Paul Backman, Horizons' services director, said the hike in menu prices suggests that while food ingredients may be cheaper in the short term, the trend for the 12 months from December 2009 to December 2010 is that costs are still rising and that operators have to factor this in to their menu prices.

"There will also be an element of raising menu prices to pay for the widening use of discounts and money-off vouchers," he said.

"Operators are trying to maintain their margins by using their buying power to keep cost pressures under control and re-engineering menus to bring average costs down. While these price increases seem high, meal deals and discounts are being used to lower prices and drive consumers to choose higher margin alternatives.

"Furthermore, this research doesn't take into account the rise in VAT in January, so menu prices are likely to have risen again in the first quarter of 2011," Backman added.

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By Janie Stamford

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