WA fuel crisis: Takeaway bagel and smoothie prices skyrocketing as hospitality sector bears brunt of crisis

Everything from the cost of a pint of beer and bowl of chips at the pub, to a coffee and bagel at the local cafe are already starting to rise as WA’s hospitality industry feels the bite of the nation’s fuel crisis. And the issue will likely worsen in coming weeks, with major suppliers warning cafes and restaurants they will have to pass-on the cost pressure. A number of outlets across the metro area and regions are already having to hike up menu items like beer, coffee, sandwiches, burgers, chips and cakes, with some already adding roughly 10 per cent to the cost. It means about 60 cents added to the price of a regular takeaway coffee or $1.30 to the cost of a pint of full strength beer. Major WA service business Instant Waste Management has written to its customers statewide saying invoices will have to increase if petrol costs don’t come down any time soon. “With the recent sharp surge in fuel prices, we have been carefully monitoring the impact on our costs of operations,” the letter reads. “As transport costs typically represent the third largest cost in undertaking waste management services, any increase in fuel increase could have a dramatic effect on our costs of operations. “If diesel prices fall back to February 2026 levels prior to the end of this month, we will not raise the diesel fuel surcharge.” Every business The West Australian has spoken to said they could not absorb the increasing costs they’re already facing and have already — or would soon be forced to — pass it on to their customers. Kinky Lizard cafe — which has nearly a dozen venues across the Perth — said it’s lifted the price on its cabinet items — like wraps., toasties, juices and cakes — by about 10 per cent. “Most suppliers are going to charge us three per cent, some of them are going up to seven per cent, and then some of the suppliers have a fixed fee on top of every delivery which is (between) $3 up to $5,” operations manager Emilie Kaasik said. “We don’t want to raise the prices because we still want to welcome to come and enjoy, but in the last few weeks we’ve seen foot traffic has slowed down as well. “Everyone is suffering, but that also means it’s going to affect my workforce.” Sneakers and Jeans hospitality chief executive Andy Freeman said Pirate Life Perth had been forced to introduce “Snacky Hour” — offering free bar snacks for an hour every Friday — in a bid to get customers to stay and spend more at uncertain times. “Our margins and hospitality is already pretty tight ... COVID wasn’t that long ago, and we went through a similar thing then, which is really just fatiguing to have those repressed memories sadly come back today,” he said. “But we’re also trying not to be too reactive yet, we’re in a better position today than we were once upon a time, and we’d rather add value back to our customers than charge them more.” Mr Freeman said one of his suppliers had already upped its costs, but said it was “still early days”. “If that happens across the board and we have dozens and dozens of suppliers (charging more), then that adds up to be a pretty large number,” he said. Maylands’ Mrs S cafe owner Tri Ho said he could not rule out raising menu prices after one of its suppliers introduced a seven per cent fuel surcharge. “At the moment we haven’t got any plans to boost the prices because I seriously know how people are suffering a lot from all their expenses, but b,” he said. He said his family was already feeling the pinch of the cost of living crisis. “At the end of the day, all I need is to get enough money to bring food on table and pay for living costs,” he said. “If prices keep going up and fuel keeps getting more and more expensive, I seriously can’t think of what I need to do next ... I feel the pain for everyone.” The pain is also being felt in the regions, the Kimberley’s Spinifex Hotel has put a surcharge on the bottle-shop, bar and food sales. The price of diesel nearly hit the $3 mark in Derby on March 19, rising to $2.989 per litre at the local BP service station on Loch Street, an increase of 49c from March 12 and 81c per litre since the start of the Iran conflict on February 28. The supplier price increase has made the cost of drinking a pint of the popular Great Northern Super Crisp at the Derby Boab Inn — one of the town’s main watering holes — increase from $13.50 to $14.18, with locals taking to social media to lament the price rise. Busselton’s Shelter Brewing Co chief executive Paul Maley has also felt the brunt of the price pain which he says is crippling local businesses. “The fuel levy on freight has doubled, suppliers are beginning to pass on these costs and it’s only going to get worse without some kind of intervention, so we’re preparing for a tough period ahead,” he said. “Being based in the regions we’re acutely impacted as our raw ingredients come from Perth or further afield, which adds significant costs to doing business. “Without a train line, road freight is the only way to get goods and supplies to and from the South West and these companies have no choice but to pass on the additional cost of operating these vital services.” He described the crisis as unsustainable, and pleaded with the State Government to implement “common sense solutions before we see widespread damage to the local economy.” FuelWatch recorded an average of 240.5¢ for unleaded on Thursday — a 42 per cent surge compared last month — whilst diesel jumped to a staggering 281.5¢ — a 55 per cent surge from its average of 180.5 last month. Australian Hotels Association WA chief executive Bradley Woods said rising fuel costs would likely affect the cost of food and drink, but said the sector was committed to keeping prices “as stable as possible.” He said there were no widespread supply shortages impacting WA hospitality venues, adding the industry was “highly experienced in adapting and sourcing alternatives where needed”. “Hospitality businesses are doing everything they can to keep prices manageable and to absorb increases where feasible,” he said. “However, when multiple cost pressures rise at once, there are natural limits as to what can be absorbed. “If price changes do occur, most businesses make careful, considered decisions before passing on any costs to customers.”