How Inflation Has Changed Prices—and the Menu—at One Small Business

Judy Henry’s

restaurant has been known for its housemade rosemary focaccia, served warm with extra-virgin olive oil to each table. In November, after nearly 20 years of the bread being complimentary, she began charging guests $1.50 per loaf.

Using bread to help balance the books is one way the chef-owner is managing rising costs of everything from workers to crab meat at her restaurant, Judy’s on Cherry, in Reading, Pa. Beef and pork trimmings previously used in soup are now ground up and used in a meatball appetizer, creating a new source of revenue. Ms. Henry last month raised the price of nonalcoholic beverages by 30 cents and stopped offering free refills.

Big companies report little trouble passing on higher prices to their customers. But inflation has been painful for many small businesses, which typically have less bargaining power with suppliers and smaller cash cushions to tap in hard times….

Read more…