Legendary family-favorite chain to hike prices – as inflation weary customers say ‘just shut down’

Olive Garden bosses have revealed they will increase prices this year despite lackluster sales, angering the very customers they are trying to appeal to.

Darden Restaurants, owner of Olive Garden, said the beloved Italian chain’s same-store sales (or sales at locations open at least a year) fell 1.5 percent in the quarter ended May 26.

In response, executives said they will raise prices 2.5 to 3 percent not just at Olive Garden, but at its vast array of restaurants, including LongHorn Steakhouse, Ruth’s Chris Steakhouse and Yard House.

This decision comes despite the fact that the company as a whole saw revenue increase 8.6 percent to $11.4 billion in fiscal 2024, largely due to the outperformance of LongHorn Steakhouse.

Customers on social media said Olive Garden is going in exactly the wrong direction and needs to “read the room,” especially as years of ultra-high inflation have taken away people’s ability to spend money on things like dining out.

The move to increase prices is not new, as Olive Garden already made their menu 1 percent more expensive last year.

Rates appear to be doubling even as executives admit food inflation is hitting the least affluent customers.

“Consumers are generally concerned about inflation and increasingly concerned about the labor market. And what we’re seeing are some of the behavioral changes that we’ve already started to see,” Darden CEO Rick Cardenas said on the call.

Darden CFO Raj Vennam said the sales decline was due to a decline from lower-income people, while customers with deeper pockets are reaching Olive Gardens at the same rate or even more.

But Cardenas said Darden-owned restaurants won’t offer discounts like some other fast-food chains do.

“We’re not going to do things to buy revenue, even with the increasing discounts that our competitors are doing,” he said.

The vast majority of Americans now say they rarely eat at fast-food restaurants because of inflation and view dining out as a luxury beyond their reach.

Given these facts, Olive Garden’s choice to raise prices even further is confusing and frustrating to many.

One person wrote on X: ‘Olive Garden is raising prices because food inflation has reduced the number of people eating out. Can someone explain this logic[?]’

Another wrote that the restaurant “might as well close.”

Someone else responded TikToksaying Darden executives are “tone deaf.”

“If you’re losing foot traffic and customers and you realize consumers are struggling, this might not be the best time to brag about raising prices,” he said in the video.

“The board needs to look for a new executive team and a CEO and CFO who are not so tone-deaf.”

Darden Restaurants CEO Rick Cardenas (left) and CFO Raj Vennam were called “tone deaf” on social media for their joint decision to raise prices at all restaurants as inflation remains an ongoing battle for low-income families

Chili’s, another casual eatery, is going in a different direction than Olive Garden. In addition to offering all day, every day happy hour at some locations, Chili’s is doing a ‘3 for Me’ meal for $10.99 that includes a drink, an appetizer and a main course

Applebee’s is also going after the crowd that wants to spend less money on a night out. Specifically, it wants to woo couples with its “2 for $25” deal, which includes two entrees, an appetizer to share or two salads.

Restaurant chains have been under pressure to cut prices for months, especially as supermarket prices rise at a slower pace.

It looks like fast food chains are finally giving in to consumer demands this summer, with McDonald’s most notably introducing a $5 meal on Tuesday.

For a limited time, Wendy’s is offering a breakfast combo menu for $3, while Burger King will again be serving a $5 Your Way Meal in the summer.

Even casual restaurant chains more like Olive Garden are testing discounted combo meals.

Chili’s, in addition to offering all-day, everyday happy hour at some locations, is offering a “3 for Me” meal for $10.99, which includes a drink, an appetizer and a main course.

Applebee’s is hoping to attract couples with its “2 for $25” deal, which comes with two entrees, an appetizer to share or two salads.