Going out to eat in Colorado is getting more expensive. A new analysis of federal data shows restaurant price inflation in the state is the highest in the country.
Running a restaurant is a high-cost endeavor, and profit margins are often slim. Sonia Riggs, CEO of the Colorado Restaurant Association, said restaurants are feeling pinched.
鈥淚ncreased food pricing, increased labor pricing, fuels going up, packaging," Riggs said. "We've been seeing this for quite a while, and it just continues to happen.鈥�
As operating expenses increase, those costs are passed onto the plate. According to the analysis, menu prices in Colorado have increased by nearly 25% since last November. That brings an average meal out from about $91 in late 2022 to about $112 in June 2023.
Riggs said restaurant operators don't want to raise prices, since increased costs on consumers mean customers may choose to stay home rather than open their wallets. This balance has always been a concern in the minds of restaurant owners, Riggs said, but recent challenges in the business have further heightened that dilemma.
"COVID, really, not only made those profit margins smaller, but the continuing rise of prices has also made those margins smaller," Riggs said. "So restaurant operators have no choice but to pass their increased costs onto the customers."
Riggs said she hasn鈥檛 studied why Colorado is ahead of the rest of the country, but she suspects that it's due to rising labor costs and costs of living.
Fortunately, eating out is still more affordable in Colorado when compared with other states like California and Hawaii, where a meal costs around 25% more on average than in Colorado, according to the study.
