Planning and a smart approach to menu strategy can mitigate the effects. Restaurant operators may see dramatic prices increases for certain products several times a year.

In 2015, the cost of eggs spiked due to avian flu, which reduced the count of table-egg-laying birds in the Midwest and Pacific Northwest. Then, in 2016, the cost of vanilla beans skyrocketed after a poor harvest in Madagascar, which produces most of the world’s supply.

The good news is that overall, food costs are forecast to rise at a relatively low rate this year. The U.S. Department of Agriculture said in June that it predicts retail food prices to increase 1 percent to 2 percent through 2018. Producer prices – the prices paid to domestic producers for their products – tend to track closely to retail prices.

So how can restaurant operators deal with this unpredictability?

Read the full article in NRN here.

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