Monday, July 20, 1998
Prices on the rise at on-campus restaurants
ASUCLA: Food services adjust costs because of hike in minimum wage
By Neal Narahara
Daily Bruin Contributor
A price hike appears unnecessary while the students association (ASUCLA) food services expect an increase in revenue.
However, on June 29, prices went up on nearly half of the food items sold at ASUCLA restaurants.
"Price changes are made just to keep up with inflation," said Patricia Eastman, executive director of ASUCLA.
With ASUCLA scheduled to renovate various campus restaurants, such as the Cooperage and the Bombshelter, improvements are expected to increase the contribution ASUCLA food services will make to the recovery of the financially troubled student association.
"We're not trying to pass the costs of improvement onto the foods," Eastman said.
With a near-monopoly in food service on campus and a relatively captive population of students and faculty, price changes will affect an estimated 4.5 million customers in 1998-1999.
One of ASUCLA's missions is "providing an excellent value in necessary products and services."
In accordance with this mission, price increases are made only when necessary, ASUCLA officials said.
"We didn't have a price increase last year," said Dave Nirenberg, associate director of ASUCLA Food Services.
According to Nirenberg, price changes are determined in February and go into effect immediately after summer commencement to minimize disruptions in service.
"We're not trying to hide price changes," Nirenberg said.
ASUCLA has tried to raise prices gradually to avoid the "sticker shock" of a large price increase.
"In some cases, price changes did not fully cover cost increases," Nirenberg said.
These price changes, however, have not gone unnoticed.
"Before, if you wanted a Coke, you could just bust out a dollar. Now, you have to have change," said Amee Rainwater, a fourth-year sociology student, referring to the increase in price of a medium Coke from 99 cents to $1.05.
The cost increase was largely due to the rise in the minimum wage, which rose from $5.15 to $5.75, Nirenberg said.
While ASUCLA student employees make more than the minimum, their pay increases when minimum wage goes up.
"We would have had a lesser price increase if not for the minimum wage increase," Nirenberg said.
One way ASUCLA measures how much students spend in their restaurants is by calculating the average check total.
In their most recent budget, ASUCLA estimated an average check of $2.80 for the 1997-98 fiscal year. The projection for the 1998-99 fiscal year is up four cents, at $2.84.
However, this is not necessarily reflective of the total costs to students. This figure takes into account purchases as small as a cup of coffee and averages them with more significant purchases, such as a meal.
It also takes into account "buying down" by customers as a result of higher prices.
"(For example,) a student with a fixed budget might buy a burger, fries and a Coke two days, and a burger, fries and water one day because of the price increase," said Nirenberg. "We lose that sale."
The Office of Residential Life currently has no plans to increase the value of dorm meal coupons in response to higher prices. The coupons are worth $1.85 for lunch and $1.90 for dinner.
ASUCLA goes through a complex process to determine new prices. Price changes take into account prices of other food vendors and projected food prices set by the FDA.
In the end, however, food service management has the final say on food price changes.
"Students can expect us to continue to have high quality food and to continue to innovate," Eastman said. "As we reinvent our restaurants, you might even see lower prices."