Is Dynamic Pricing Right for Your Restaurant Brand?

More restaurant operators are taking advantage of dynamic pricing, which is the process of adjusting prices based on customer demand. While relatively few U.S. restaurants have adopted this new approach on a day-to-day basis, many operators are wondering if it might have merit for their operations.

A few restaurants have been successful in executing dynamic pricing as a core part of their strategy, with the most well-known being Chicago restaurant Next, which opened in 2010. The restaurant is consistently rated one of the top 10 in Chicago, and sells reservations in advance online with prices that vary depending on the day and time. For example, a Friday 5 p.m. reservation might tie to a $185 charge per person, while a 5:45 p.m. reservation on the same day may be $195. As the night moves into the most popular timeframes, the reservation price increases.

Here are three things to think about as you consider a pricing strategy:

Before You Seek a New Approach Outwards, Look…