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Raising prices by 50% and expecting little-to-no dropoff in traffic is a blatant violation of the law of supply and demand (which has a very good track record).
by listenallyall 4y ago
Raising prices by 50% and expecting little-to-no dropoff in traffic is a blatant violation of the law of supply and demand (which has a very good track record). Perhaps you personally, with disposable income, or for your favorite restaurant, might not reduce your visitation, but the overall public certainly would.
- u801e 4y agoThat really depends on the make up of their customer base. Most people who decide to eat at restaurants have some disposable income. Those that don't would be eating at home anyway. How many of those customers would switch to eating at home? If a single restaurant changed their prices like that, then they would certainly lose business, but if every restaurant in the area did it, then people would have to collectively change their eating habits. My guess is a lot of them may not. Plus, the 50% increase doesn't happen all at once. It happens over a longer period of time, meaning that prices will gradually increase. That gradual increase won't drive customers away as much as a sudden price increase should.