Ask George: As ketchup prices rise, will restaurants start charging for the condiment?

As ketchup prices rise, will restaurants start charging for the condiment? —Pat B., St. Louis

On the heels of possibly the worst year in restaurant history, when restaurant owners recently learned that a shortage of ketchup packets caused prices to rise, you could almost hear the collective exasperation, “What’s next?”

Over the past 12 months, an increase in takeout and delivery orders has caused ketchup sales to spike. According to The Wall Street Journal, packet prices have risen 13 percent since January 2020, and customers are reporting that ketchup packets have already become difficult to obtain at drive-through windows.

When restaurants can ill afford any additional new expenses, a price increase for the most common and popular table condiment in the U.S. hits especially hard. That said, restaurant owners have weathered shortages and price hikes countless times before. (In recent memory, beef, bacon, limes, and avocados come to mind.) Some of the higher-volume commodities (such as beef) get passed along in the form of higher menu prices, while others are absorbed. Since shortages and respective price hikes are temporary, restaurant owners are loathe to make knee-jerk reactions, such as raising prices and passing on the increases in incremental charges added to the customer’s bill.

We asked several restaurant owners (all of them high-volume ketchup buyers) how they interpret the latest bitter pill.

Derek Deaver,  Three Kings Public House: “We used to charge 50 cents for extra sauces, and it really upset people, so now we incorporate these costs into menu pricing. Corporate restaurants figured this out a long time ago.”

Brant Baldanza, The Tavern Kitchen & Bar, Shack, The Corner Pub & Grill: “I have heard that packets are going up in price, but that shortage is not as much about the product but more about the resin for plastic used in the packets. From my understanding, it’s the resin shortage—for the to-go bags, boxes, and now ketchup packets—that is causing the shortage and price hike. But to answer your question, restaurants have been through a lot this year. When I think it can’t get worse, it got worse and when I think that it will never get better, it got better. So when I’m asked if I will ever charge for ketchup packets, I will say, ‘No, maybe, and yes.’ That should cover all my bases.”

Tracy Stamper: Syberg’s, Helen Fitzgerald’s, Twisted Tree Steakhouse, Twisted Tavern: “At this time, we don’t have plans to make any significant changes, but we are discussing a procedure for our staff to ask curbside pickup guests if they would like condiments for their meals.”

Mike Kupstas, Lion’s Choice: “If we’ve learned one thing this past year, it was the need for adaptability.  Ketchup is certainly the hot topic of the day, but to put it in perspective, I bet we’ve had nearly 50 breaks in supply chain this past year. I recall 21 products impacted in July through September of last year alone.  So we adapt. So far, we’ve attempted to address those issues with alternative brands, different pack sizes and formats—and avoid passing that directly on to customers. I would find it difficult to charge incrementally for something like ketchup, particularly since the ability to customize at Lion’s Choice is so key to our guests. Also, I don’t see a place were we would limit usage, provided we had supply. We’re fortunate that we have an array of sauces that enhance fries; many of our guests prefer alternatives like honey-mustard or chipotle-ranch with their fries. All that said, the industry is experiencing inflation across the board. I wouldn’t be surprised to see some off-cycle price increases to help offset the overall cost pressures, but less likely on things that we believe will eventually correct themselves—like ketchup.”

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