Restaurants Put Less Expensive Ingredients on Their Menus

By STEVENSON JACOBS, Associated Press
May 7, 2008

Struggling with soaring food costs and cash-strapped customers, restaurants are swapping expensive ingredients for cheaper fare and adding new dishes that won't break their bottom line.

Call it a menu makeover: Steakhouses are adding buffalo meat alongside filet mignon, pizza joints are trying new cheese products, and seafood spots are replacing pricier entrees with humbler dishes like catfish.

The changes come as record oil prices and surging global demand for staples like rice, fish, poultry, and wheat have pushed wholesale food prices up almost 8% in the last year, the biggest hike in three decades, according to the National Restaurant Association.

Food commodities prices have mostly come down from record highs reached earlier this year, but wholesale flour prices have still doubled in the last year, while egg prices have shot up 70% and cheese 25%.

"This is definitely an unprecedented period of wholesale food inflation. Operators must focus on cost, and one way is using different ingredients," a senior vice president of research at the 380,000-member National Restaurant Association, Hudson Riehle, said.

At Ben Benson's Steakhouse in midtown Manhattan, wholesale costs of prime beef have shot up 50% in the last year, forcing the 36-year-old establishment to raise the price of its signature 18-ounce sirloin steak from $40 to $46.

"The cost of beef is staggering," owner Ben Benson said, who has added new menu items like buffalo, boar, and elk to help offset the increases. "They sell very well. It's not a big percentage but they cost us a little bit less and we sell it for almost the same, so it hedges a little bit."