How do I introduce a menu price change to my customers?

[1st Baby Due 03/9/2010]

My parents and I just took over a small coffee shop. Our closest competition is about 10 minutes away but not on the same street. One by the way the whole concept is being sold.

So the thing is our prices are WAY too low for example the Coffee shop that is about 10 minutes away (completely different route and not as convenient as mine) I bought a caramel mocchiato a short (small) for $4.50???!!! YIKES that's too high because my Large caramel Mocchiato goes for $4.01 tax included. So not even my large goes for as much as they're small does...

So the question is how much should I increase my prices? Im thinking maybe $0.50 extra or $0.25? Next questions is HOW do I introduce my prices to my customers? ALOT of them know that the place is under new owners and manager, we have started redecorating, adding more cold sandwiches to the menu, and little extras around the place... We do offer free wifi, as well as drive through window.

So should I post up a sign? or just change the prices? IDEAS!!! I NEED IDEAS!!!

Thanx N Advance

 

[Christopher M]

I think you should advertise the cost effectiveness during trying times of yourBusinesss & shoot a hole in your competitions foot. If more people were aware of there ability to save & not lose quality you'd profit more than raising prices. This could be accomplished quite easily by taking samples of your wares to local offices in your business area. People love samples. Print out fliers to hand out / mini menus . At each business close by offer free delivery to Faxed in orders. Set a time per ay 1 hour notice on deliverable items , so you not flooded at 12 noon , or other busy times. Offer catering to your local businesses , banks . I know a girl how has a restaurant & shes a pastry chef. She would go to each bank , insurance company etc. with a van load of fresh goods every a.m. bringassortedd items in a basket ... and they ordered for their next day if they want aparticularr item. Now she has al call in orders , people are now familiar with her goodies. Solicitation is your wheel tosuccesss , not price hikes in tough times. people save $0.25 you sell 3 more items. peopledon'tt save by coming to you , you can lose 3 people ...get it ... solicitations. Ask yourBusinesss that you choose to do deliveries if you may have their Fax # o send over a Menu , then since hey gave it to you , you can fax over your daily specials etc. Solicitation thru Fax is Illegal , now I have never seen the Fax police & I solicit my business via Fax all the time. Here's one for you. Go to www.salesgenie.com you get 100 free contacts and all there information including but not limited too their Income annually , # of employees , credit rating , # of people employed , addresses , phone # Fax #'s everything ~ Solicite the business in your area. Sales Genie cost $1,800 per yar to use the endlessly , but if you can get 100 free contacts in your local business community... for free , your ahead of the game. Soliciting is your key to a full coffee shop not price hikes.

 

[raigafan18]

$0.25 sounds like a good start. Maybe promote it subtly with new specials, like, say, raise a cappuccino from $2.00 to $2.25, but then mention that when you buy a cappuccino, you get $0.25 your second drink. Don't be too conspicuous, because it might drive customers away. Make a potentially negative price change into a positive!

 

[justbeingher]

I don't think u need to announce it. Just post and charge the new prices and school your staff well beforehand how to handle and answer questions. With this economy, price hikes are not surprising.

 

[Kurtis B]

I think you should keep them low, and use that as force against the other shop. Don't raise them or they will go to the other one instead, I know i would.