Square Data Reveals “Lunchflation” Trend as Restaurants Adapt Amid Rising Costs
Restaurants can offset rising costs for customers by optimizing front- and back-end operations for increased savings
As workers return to the office after two years of remote work, Square analyzed sales across the United States of popular lunchtime meals to understand how much consumers can expect to pay post-pandemic.
Overall, Square data reveals a new trend of “lunchflation,” with lunch item costs rising faster than the average cost across all other items. For example, as of March 1, 2022, the average price of wraps is up 18% year over year, while sandwiches have seen an increased cost of 14%. Tacos will cost consumers an additional 12%, while those opting for greens can anticipate a higher price tag of 11% for a salad. Consumers will be charged 8% more for burgers and if pairing with soup, can expect to pay on average 5% more for this item. The average cost across all items has jumped 7% year over year.
The increased price of lunch for consumers is due to the rising costs faced by restaurants, who’ve seen everything from labor to ingredients become more expensive. To combat these challenges, restaurants can enlist features like online ordering, self-serve ordering through QR codes, and local and flat-rate delivery through third-party partners. All of these operational efficiencies will enable restaurants to cut costs and pass savings onto customers.
“Restaurants have been among the hardest-hit businesses over the past few years, and now they’re facing rising costs across all parts of their business due to labor shortages and supply chain constraints,” said Bryan Solar, Head of Restaurants at Square. “While technology offers many solutions, business from and relationships with the customer continue to be key to restaurants’ survival.”
When looking more granularly at major cities across the US, Square found the following from March 1, 2020 to March 1, 2022:
- Wraps increased by 13% from $9.05 to $10.21.
- Sandwiches were running consumers $14.50 pre-pandemic, but have increased from $9.40 on March 1, 2021 to $10.77 as of March 1, 2022, up 15%.
- Taco prices have increased 19% from $5.43 to $6.48.
- While the recent average price of salads hasn’t returned to pre-pandemic heights of almost $15 in March 2020, the average price has increased from $9.44 on March 1, 2021 to $10.32 as of March 1, 2022, rising by 9%.
- Burgers increased from $10.15 to $11.10, up 9%.
- Soup rose 28% from $7.41 to $9.47.
Nationally, the share of classic lunch items that have taken place in-person hasn’t returned to pre-pandemic levels, with more consumers placing orders online for delivery and pickup. However, a growing share of lunch item orders are being placed in-person this year, as of March 1, highlighting the need to offer customers options in how they order across online and in-person.
“In addition to being upfront and honest about why prices have changed, restaurants can lean on inventory management software to combat supply chain woes,” said Bryan Solar, Head of Restaurants at Square. “Restaurants that also offer different ways of ordering, like tableside QR codes and pre-ordering online, can maximize sales by meeting customers’ preferences in how they purchase and pick up their items in cost effective ways.”
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Data compares payment transactions from quick-service restaurants within the US on March 1, 2020, March 1 , 2021, and March 1, 2022 on a 28-day rolling average. Data broken down by major cities includes San Francisco, Austin, New York ,Chicago, Dallas, Houston, Atlanta, Seattle, and Washington DC.