Say, your local pizza joint.
After all, these local businesses are caught in the mix. A global economy with rising demand for wheat in China and a weak overseas dollar increasing the price of imported olives both push food costs up. A higher minimum wage affects payroll. And soaring gas prices affect not only the cost of goods delivered to their kitchens, but pinches the poor delivery driver trying to make a buck.
And for the consumer, no matter how you slice it, it’s going to cost a little more dough when that driver knocks on your door in the future.
“The $5 pizza craze is going to be over,” said Mike Daniel, owner of Mr. Mike’s Pizza on South 31st Street in Temple. “Hopefully, they (customers) are going to understand that something’s going to have to happen. I’m at about the same prices as I was when I opened eight years ago.”
The smaller pizzerias are suffering the most, said Richard Slawsky, with Pizza Marketplace, a news and information Web site for the pizza industry.
“The big operators will purchase cheese contracts. They will pay the same price for an entire quarter. They’re insulated from price increases,” Slawsky said.
But Daniel says the large pizza chains will eventually raise prices, too. When the negotiated quarterly prices expire, the large companies will be forced to follow suit, and raise prices.
“The places that do have real low prices, it won’t last long,” Daniel said. “Once that bid’s up, they’re going to charge more too.”
Even when the future price increase goes into effect, Daniel said his profit margin would be below last year.
Near Lake Belton, Azmi Alsadi has been baking pizzas at his restaurant - La Roma Pizza and Subs - for six years. Looking back to 1983 when he opened his first restaurant in Louisiana, he says he’s never seen prices soar like this.
“A 50-pound bag of flour in the last three months jumped from about $15 to $33,” Alsadi said. “We’re talking about double the price, we’re not talking about 20 or 30 percent increase, we’re talking about a 100 percent increase. For me as a small business, as a pizza place, I can’t turn around and increase my prices all of a sudden.”
Alsani said he recently raised salad prices, but for now he is holding steady.
“I purchased 50,000 flyers that cost me close to $3,000. You have to honor what the price is. I’m eating it to stay in business. It’s really very hard.”
Texas Restaurant Association spokeswoman Wendy Saari said higher food prices are impacting restaurants “across the board, they’re having to tighten their belt, but we haven’t seen any mass closings.”
Customers wanting to save gasoline are increasing delivery orders, but high gas prices cut into the delivery drivers’ income because they use their own vehicles. Both Daniel and Asani said they have increased the rate they pay their drivers. And Asani said he’s considered discontinuing deliveries, but it would be economically devastating.
Over at Mr. Mike’s, owner Daniel asks for his customer’s empathy.
“I feel bad when our drivers go out to the boonies and come back with nothing,” Daniel said. “Even a dollar or two - it’s really helpful.”
But just as the current economic woes seem to perplex Washington, Asani said he has no answers.
“I don’t want to get deep into politics, but I don’t think either party can do anything about it right now. We are in a mess.”
fafflerbach@temple-telegram.com
