Following fast-food giant Wendy's plans to introduce a dynamic pricing model, San Diego-based Puesto Mexican is now lowering and raising menu prices based on demand on some orders from its restaurants.
Ride share services like Uber and Lyft have long adjusted prices based on demand and congestion, fluctuating to keep drivers busy and paid accordingly. Similarly, airlines and hotels raise prices during peak times like holidays. Now, dynamic pricing is extending to restaurants with online ordering, potentially unsettling some consumers.
Wendy's garnered attention, along with criticism, for unveiling plans to test dynamic pricing in its restaurants starting in 2025. Some customers interpreted this as potential price hikes during peak hours. However, Wendy's clarified that the initiative aimed to facilitate menu changes and provide discounts during slower periods. San Diego-based Mexican restaurant chain Puesto is now doing dynamic pricing at its locations when using DoorDash and marketing the menu alterations as discounts.
Puesto restaurants are now relying on dynamic pricing engine Sauce to fluctuate menu prices when ordering delivery via DoorDash. The company is reporting the new strategy will boost sales by 12%. The restaurant reportedly raises prices by as much as 8% during busy periods and reduced them by as much as 20% during slower times. Puesto's new practice is already facing criticism on some online forums.
With the first location founded in San Diego's La Jolla in 2012, Puesto is family-owned and operated by brothers, Eric and Alan Adler, and their cousin Isi Lombrozo, all native San Diegans of Mexican descent. The restaurant now has eight locations, including a 9,000-square-foot bar & eatery that opened in Silicon Valley in 2018, a second San Diego location sited at The Headquarters at Seaport Village, and a 10,000 square-foot brewery and restaurant in San Diego's Mission Valley. The company also owns and operates Marisi Italian in La Jolla. There is no word on whether Puesto plans to introduce the dynamic pricing model at its other restaurants.