In response to the rising cost of food, the parent company of Olive Garden said that it plans to raise its menu prices in the near future.
Raj Vennam, the company’s chief financial officer, told analysts on a conference call that the restaurant chain’s prices would be in line with the inflation rate of around 2.5% to 3% for the year.
Over the past few years, the company has been able to keep its prices relatively low.
According to Vennam, Olive Garden’s prices have been under-priced by around 20% when compared to the CPI.
He noted that the company would continue to do so as it feels that it has done a good job of managing its prices.
During the company’s most recent quarter, it increased its menu prices by around 1%.
During the past couple of quarters, the company has seen its same-store sales decline.
However, during its most recent quarter, its earnings beat the expectations of Wall Street analysts.
Rick Cardenas, the company’s CEO, said during the call that the increasing cost of food has caused consumers to become more concerned about the economy.
He also noted that the sales of Olive Garden to customers who are below the median income have been decreasing.
Despite the economic situation, Cardenas noted that Olive Garden was able to maintain its prices relatively low.
He said that the company’s focus on its value and brand promise will continue to help it attract more customers.
To attract more customers, the company is focused on providing a great value and an excellent experience. It also aims to encourage its consumers to return.
