According to their data, a 15% service charge has never been a source of profit for businesses.
These funds were used to create a targeted fund that ensured decent working conditions for staff and maintained a high level of service.
“Integrating this amount into the cost of dishes is the only legal way to preserve employee incomes and prevent mass staff turnover. Thus, changing the format of displaying the service on the bill (where a separate line becomes part of the total cost) contributes to greater transparency in the market without affecting the economic component of costs,” the association's message states.
The previously used service percentages became part of established practice, providing additional support for both workers, such as waiters, and the establishments themselves.
Part of these funds went towards covering operational expenses related to the operation of à la carte dining rooms, including costs for consumables and basic customer service (napkins, toothpicks, cutlery sets, sugar).
The "Horeca" Association conducted a pricing analysis that takes into account seasonal fluctuations and "quiet" periods when the number of customers decreases, yet operational costs remain at the same level.
Considering the rise in prices for food and goods, public catering establishments form their expenses according to the following principle:
- products/raw materials — 38-40 percent;
- rent — 7-8 percent;
- wages (including taxes and social contributions) — 15 percent;
- utilities and security — 2-2.5 percent;
- operational expenses — 2-2.5 percent;
- packaging — 1.5 percent;
- marketing — 5-6 percent;
- expenses for inexpensive and fast-wearing items — 3 percent;
- transportation costs — 1 percent;
- banking services/acquiring — 1–1.5 percent;
- delivery aggregator services — 1-1.5 percent;
- depreciation — 1-1.5 percent;
- taxes — 4.6 percent.
Thus, the total cost structure in pricing fluctuates from 82.6 to 88.6 percent depending on the season, the level of establishment occupancy, and other factors.
“It is incorrect to consider the justification of prices solely through the lens of the cost of individual dishes. This approach overlooks a significant portion of mandatory expenses without which the operation of establishments is impossible. The provided calculations give an averaged view of establishments in the mid-segment that are part of the "Horeca Club" Association. The association does not set or regulate prices across the entire sector and is not responsible for pricing in establishments that are not its members. The association previously warned that short-term and poorly thought-out measures would lead to price increases in the public catering sector, but these warnings went unheeded,” the association representatives added.
The association emphasizes that a simplified and one-sided approach to discussing prices in the hospitality sector is unacceptable.
According to them, the rise in prices in restaurants and cafes is a direct consequence of the increased cost of raw materials and supplier services, especially for basic goods such as meat, dairy products, and eggs.
The association calls for the establishment of a professional and constructive dialogue between the government, business, and experts, based on facts and economic calculations, as well as an understanding of the real working conditions in the sector.
