A employee sprinkles cheese on a burrito at a Chipotle Mexican Grill restaurant in Hollywood, California.
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Consumer brands from Chipotle Mexican Grill to Whirlpool are dealing with inflation by passing higher costs onto their customers through price hikes.
Many companies that reported quarterly results in the past two weeks said they’re raising prices to offset rising costs from labor, raw materials and other inputs. Several major businesses saw preliminary success from their pricing actions.
The moves come as recent data show prices jumping at record rates amid the economic recovery from the Covid pandemic.
The Federal Reserve believes the inflation will moderate eventually and is largely the result of high demand outstripping supply as the economy restarts from the pandemic. But companies aren’t waiting around to find out if the Fed is right, implementing price increases they may not be so quick to roll back even if input costs come down.
Chipotle made headlines in June after announcing it would raise menu prices 3.5% to 4% to offset increasing its average hourly rate to $15.
The decision paid off; the restaurant chain reported second-quarter revenue surpassing pre-pandemic levels and said it’s considering more price hikes down the line if inflation persists.
“There’s still that possibility that we could take additional pricing action to fully close the gap…Let’s see how the menu price continues to be accepted by customers. So far, really, really good. Really seeing no resistance whatsoever,” Chipotle Chief Financial Officer John Hartung said on the earnings call Tuesday.
Whirlpool washing machines for sale at the Airport Home Appliance store in Concord, California.
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