Mom-and-pop restaurants feel price pinch

Sedalia’s mom-and-pop food industry has suffered with rising food and gas prices over the past year.

Jana Tague, owner of the Cake Lady bakery, has been struggling with the rising cost of dairy products.
“We use a lot of dairy,” Tague said. “It’s been a pretty substantial jump, really.”

Bakeries and restaurants are experiencing price jumps similar to those consumers are seeing in the grocery stores, but owners say they’ve been trying to hold their prices.

“We’ve noticed an increase in prices just as anyone would notice anywhere else,” Tehya Murray, a baker at The Cake Lady, 214 W. Main St., said.

Egg prices in this region have spiked by about 40 percent in the past year, according to the U.S. Department of Agriculture. The price of a gallon of milk has jumped some 15 percent. At the same time, the cost of gasoline is up by 36 percent over a year ago, according to the AAA. The cost of all food and beverages is up about 5 percent over May last year, according to the U.S. Department of Labor.

Red Apple Restaurant owner Tony Alimi is getting squeezed from two sides.
The food distribution companies “charge you for food and delivery, too,” Alimi said. “Gas prices are high, and they’re charging you for fuel now. When the price of gas changes, the price of food changes.”

Store owner Lily Pitsul must pay twice the money to get her Kansas City distributor to deliver food to Izmail European Market, 1716 W. Ninth St.
“Well, we have a distributor that wants us to order at least two pallets of food,” Pitsul said. “If we order two pallets, it’s $10,000 to $12,000 worth of food.”
Selling that amount of food would be impossible for Pitsul because her store is small, and the food is perishable. Most weeks, Pitsul gets one pallet of food, but still has to pay for the price of two so the company will deliver to her.

“We used to get deliveries once a week, but now we only do it twice a month,” Pitsul added. “If we run out of food, we just have to wait until the next delivery.”
Jason Pryor, interim president of the Kansas City Area Restaurant Association, said small food businesses in cities such as Sedalia are having the most trouble.

“I feel the pain of the rural cities because, with the distance, everything is much more expensive,” Pryor said. “The rural areas are taking the biggest hit.”

Restaurant owner Enrique Santiago, of Santiagos, 1716 W. Ninth St., will consider repricing his menu if the costs of rice, oil and flour don’t decrease in the next few months.

“With gas going up, the delivery also goes up,” Santiago said. “I pay more for my tomatoes, onions, everything.”
At the beginning of the year, Santiago paid $23.82 for 35 pounds of oil. Today, he has to pay $39.36, a 65-percent increase.
Santiago noticed the problem six months ago.

“The cost to run the business has gone up 35 to 40 percent,” he said.
Pryor said consumers will end up paying for the increases.

“The cost must simply be passed on to the consumer,” he said. “Every business is being affected by this. In the end, we’ll have to pass the cost on because there’s only so much any business can absorb.”

At Goody’s Steak Burgers, 901 S. Limit Ave., the famous $1 milkshake is now $1.30.
“It was either that (raising the price) or quit selling them all together,” owner Terry Goodman said. “Even at $1.30, most people understood and said they were surprised we didn’t raise prices a long time ago.”

Goodman has also had to deal with a 10 percent increase in the price of the meat he uses for his burgers.
“Except for the milkshakes, we haven’t raised the prices on the menu in a year,” he said. “If the meat and stuff don’t go up any higher, we won’t change anything.”

The rise in gas prices has caused a chain reaction, one Kansas City food distributor said.

“It’s pretty traumatic to us because our job is to make deliveries,” said Tom Elafros, owner of American Midwest Distributors. “Costs are high. You have no choice but to pass it on as much as you can.”

-City Editor Kaye Fair contributed to this story.