Inflation Fee Added to Virginia Restaurant Menu: 'We Hope You Understand'

Inflation is having a widespread impact on Americans, including food and restaurant prices. An eatery in Virginia even added an "inflation fee" to its menu, saying "we hope you understand" in a message to its customers.

The Sunset Grill in Goochland brought in the fee, writing on their menus: "With the skyrocketing costs of goods, materials & labor, we have found it necessary to add a 3.5% inflation fee in lieu of consistently raising menu prices. We hope you understand," CBS 6 in Richmond reported.

The restaurant's balance sheet has been hit by supply chain issues, the rising cost of goods and a drop in demand from the pandemic that has not fully recovered.

Owner Leslie Whitney told the news station in an email: "Doing menu changes in accordance with daily rising prices was not reasonable, as we would have been printing and reprinting two or three times a week."

Sunset Grill, VA
A Google Street View photo of Sunset Grill in Goochland, Virginia. Sunset Grill has added an "inflation fee" to items on its menu to handle the spiking input costs.Google Street View Google Street View

Whitney and her husband carefully considered what to do about it, hoping not to offend anyone with the planned added fee.

"However, we did know that we had to do something to recoup some of the money loss," she told CBS 6.

Newsweek reached out to Sunset Grill for comment.

Menu prices have increased by 7.7 percent between June 2021 and June 2022, the largest yearly 12-month increase since 1981, according to the National Food Restaurant Association.

The association said that the increase in prices was mainly due to higher input costs, particularly food and labor. The Producer Price Index for All Food increased by 15.6 percent between May 2021 and May 2022, while the average hourly earnings of restaurant staff have risen by 10.1 percent from year-ago levels.

Despite menu price spiking, the gains were less than other consumer items, such as gas and energy. Gasoline (+59.9 percent), natural gas (+38.4 percent) and electricity prices (13.7 percent) were all significantly higher than last year.

Eric Terry, the President of the Virginia Restaurant, Lodging and Travel Association, told the local television channel that other restaurants may add a surcharge or credit card fee to mitigate rising inflation.

He said that the industry had not fully recovered from the pandemic and that rising menu costs will continue through the summer.

"We lost almost 20 percent of our restaurants in the state of Virginia and across the country, and I think the restaurant industry is still struggling to get workers so they can open a full schedule or several days a week, or whatever they're used to," Terry said.

The inflation rate is the highest it has been in more than four decades, caused by a confluence of factors, including pent-up demand from the pandemic, aggressive monetary policies in response to COVID-19 and instability in eastern Europe due to Russia's invasion of Ukraine.