Noodles & Company Is Raising Its Prices Yet Again. Here's Why

Fans and frequent customers of the carb-centric fast-casual chain Noodles & Company should anticipate a hit to their wallet as the company gears up for an increase in prices across all of their locations. According to a Restaurant Business report in early August, in a recent call with the Noodles & Company executives, CEO Dave Boennighausen announced price increases across the chain, which will help offset rising costs in numerous areas of the business.

The Colorado-based chain, which had been struggling financially even prior to the worldwide pandemic, experienced a 73% plummet in their stock value in the two years following their IPO and has since seen their stock prices rise and fall over the years. Recently, as costs for ingredients and packing materials have risen, the chain has had to raise their prices multiple times to keep up.

While the company reports that it is recovering well from the pandemic dip, and has recovered about 70% of its pre-COVID business, the restaurant is still gearing up to introduce new menu pricing to cover the costs of running a large-scale food business in 2021.

Starting next week, Noodles & Company will be increasing their overall menu prices by 3%, CEO Dave Boennighausen announced on the recent call (per Restaurant Business). This price increase comes in addition to a previous 2.5% hike in the chain's prices made earlier this year. According to the company, this price increase is in response to overall economic inflation, rising commodity prices, and the added expense of to-go packaging, which the company is currently using for both takeout and in-restaurant orders.

On delivery orders through third-party apps, the chain also imposes a 17% pricing premium to help cover lost revenue on those orders. While the newly elevated cost of a Noodles order is sure to disappoint frequent customers, the adjustments may not be over. Although Boennighausen noted the company doesn't "necessarily have plans to revisit pricing and to have further price increases during the balance of this year," he also acknowledged the chain still has "pricing flexibility if [they] need it," indicating further fluctuations are possible.

In addition to the raised prices, the chain is hoping to recover some of their pre-pandemic profits by implementing more drive-thru windows (which will be added to about 70% of all new locations), and potentially operating more ghost kitchens — a term for delivery-only restaurant locations that eliminate many hefty expenses, including building materials for physical restaurants. However, whether prepared in a ghost kitchen or classic Noodles & Company restaurant, customers should prepare to face a higher price tag for their bowl of noodles.