How to Tell Guests About a Menu Price Increase: What the Research Says, Sample Wording and the Fee Rules

Guests have seen a lot of increases. BLS's index of restaurant prices — food away from home — rose 37.3% from February 2020 to August 2026, and 3.4% in the most recent twelve months. A dish that cost $14.00 in February 2020 and rose with the index would be $19.22 today. The question is rarely whether to raise a price; it is how to do it without making the guest feel taken advantage of. The arithmetic of how much to raise is in how to raise menu prices; this guide covers telling people.

What fairness research says

The best-known evidence is a set of telephone surveys of Toronto and Vancouver residents in 1984–85 by Daniel Kahneman, Jack Knetsch and Richard Thaler, published in the American Economic Review in 1986. Its findings still describe how customers judge a price change:

Two rules follow for a restaurant. Passing on a real cost increase is broadly accepted; raising prices because demand is strong is not. And timing matters: repricing stock you already bought, the moment cost news breaks, was judged unfair by the same 79% margin that accepted a straight pass-through. Raise the price when the higher-cost product actually reaches your invoices, not when you read about it. The authors add that increases "not justified by increasing costs are judged less objectionable when competitors have led the way."

Guests also overestimate what a business keeps. In a random-digit telephone survey of Florida adults reported in the Journal of Consumer Research (Bolton, Warlop and Alba, 2003), people estimated that a grocery store keeps $27.52 of every $100 in sales as pure profit; the authors compare that with a commonly cited 1%–2%, and found that people "fail to take into account the full range of vendor costs" such as labor and rent. We found no comparable survey for restaurants, but the gap is the point: the National Restaurant Association's 2024 median income before taxes was 2.8% of sales for full-service restaurants (P&L guide). Naming the cost that rose answers a suspicion the guest already has.

Framing matters too. In a 2002 Cornell survey of 157 hotel guests on a scale where 1 is extremely fair and 7 extremely unfair, the same 20% price difference by time of day scored 2.29 when presented as a discount off-peak and 3.11 when presented as a surcharge at peak (Kimes and Wirtz, Cornell Hotel and Restaurant Administration Quarterly). A $20 table-location premium scored 5.14; the same gap as a $20 saving, 3.65. Guests dislike add-ons more than prices.

Does a notice change what people buy? The only recent test we found is vendor-reported, not peer-reviewed: Revenue Management Solutions, a restaurant pricing firm, and Cornell's Sherri Kimes said in a November 2025 press release that across three experiments with 358 participants, guests "rated restaurants as fairer when price messages were displayed, but actual or intended spending remained unchanged," and that eye-tracking showed guests looked at items and prices, not the explanation. Treat a notice as goodwill, not as a sales tool.

What the rules require

We did not find a New York State or New York City rule requiring a restaurant to give advance notice of a menu price change; the rules we found cover surcharges, service charges and card fees. That is the result of a bounded search, not legal advice. What the rules do regulate is the way a price is presented:

The pattern across all of them is the same as the fairness research: show the real price where the guest decides. A surcharge to "cover rising costs" is the one approach that is both disliked and, in New York City, barred.

How big an increase looks against the market

Fifty cents on a $14 dish is close to the national pace; a dollar on $18 is well above it. Neither number decides the price — the plate cost does — but it tells you which changes guests are likely to notice and which ones deserve a word of explanation. One larger, explained change a year is easier to communicate than four small unexplained ones.

Sample wording

Keep it short, specific and true. Name the cost that rose; do not call an increase temporary unless you have a date to reverse it.

• —Menu or website line (optional): "Some prices changed on [date]. Beef and dairy cost us more than they did last year, and we'd rather adjust a few prices than change the dishes."
• —Counter or table card: "We've updated a few prices to keep up with ingredient costs. Same recipes, same portions. Thank you for eating with us."
• —Email or social post to regulars: "From [date], a handful of our prices go up — most by 50 cents, the burger by a dollar. Beef prices have climbed for two years and we held off as long as we could. Nothing about the food is changing."
• —Staff answer when a guest asks: "Yes, we raised a few prices this month — mostly the beef dishes, because our beef costs went up. Happy to point you to what hasn't changed."
• —Catering or corporate clients: "Our catering prices will change on [date, at least 30 days out]. Orders confirmed before then keep the current prices. The updated menu is attached; the main changes are in beef and dairy items."

For catering and standing orders, check the contract first: notice periods and price terms there bind you whatever a menu says. For everyone else, the research suggests the explanation earns goodwill but does not move sales, so it does not need to dominate the menu.

Update every place a guest sees a price

Make one person responsible for the whole list on the change date. A guest who sees $14.00 on Google and pays $14.50 at the register remembers the mismatch, not the explanation. DoorDash says in-store and app prices do not have to match, except that its 6% Pickup plan requires pickup prices to match in-store prices; if app prices are higher, the delivery markup guide covers how far.