Restaurants raising prices, looking for ways to survive winter

The city of Tartu.
The city of Tartu. Source: Ragnar Vutt.

Restaurants have raised their prices to combat high energy costs and are looking for solutions to save money. The Estonian Hotel and Restaurant Association (EKRL) believes there is no big wave of closures.

"Aktuaalne kaamera" reported from Tartu this week to find out how the economic situation has impacted restaurants in Estonia's second biggest city.

Püssirohukelder, which has been operating for over 20 years, received a record electric bill at the start of the month, totaling almost €7,200 for the summer months. While in 2019, electricity made up 1.6 percent of the company's spending, this has risen to almost 6 percent.

Gas will also push up operating costs in the coming months.

"If it continues like this, it won't be easy," said Püssirohukelder's program manager Vaiko Peebo. "I wouldn't like to say that we are closing, I don't want to close, but at the moment I don't see how big places with such bills will last very long."

Additionally, restaurants are being forced to pay higher prices for raw materials. The EKRL believes companies have increased their prices between 15-30 percent, on average, in response.

Cake shop Mandel said it is sometimes impossible to predict what the prices will be in advance and instead they are only discovered on the invoice.

"Such letters are coming from suppliers that, unfortunately, we currently cannot say how much raw material [prices] will rise, that the new price will be clear on the invoice," said owner Anary Roosve, adding it is easy to lose motivation to run a business in these circumstances.

Despite the difficulties, both businesses hope to stay open.

The association said many eateries have reduced their operating hours, for example, closing over lunchtime. Others have reduced their menus.

While Püssirohukelder has already done everything possible to save costs, Mandel plans to use a heater instead of a gas boiler during the winter. It would be much harder to change operating hours.

"I can't bake bread at any other time. Since the demand is in the morning, I cannot bake them depending on when electricity is cheaper. In the meantime, we joked that we could come in and bake cookies at night, so we'll see if this joke becomes a reality," said Roosve.

Ain Käpp, EKRL chairman, said measures need to be taken at the EU level as national subsidies will not mitigate the situation.


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Editor: Helen Wright

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