Why Are Prices at the Canteen Going Up?

Lately, some AUBG students have been expressing their concerns about the rising prices of food at the canteen. Olga Draganova, the dining service manager, shares more about the issue and explains why meals at the Hungry Griffin are becoming more expensive.

In a survey, conducted among AUBG students, participants said that they pay on average around 8 leva for a meal. However, most of them shared not being satisfied with the quality of the food.

Draganova expressed that she is very aware of the situation but there is little she can do. There are certain financial parameters set by the institution and the dining services need to follow them. “The cost of production is formed by many things, infinitely many things,” Draganova says.

An important factor in forming the canteen prices is the so-called prime cost. The prime cost is “the direct cost of a commodity in terms of the materials and labour involved in its production, excluding fixed costs.” Currently, the target set by the institution is for the prime cost to not exceed 37%.

“The prime cost, visually speaking, is the selling price in one leva purchase value. Imagine buying something for 1 lv. In order to achieve a 37% prime cost, we have to sell it for 3.70 lv.,” says Draganova, ”We cannot achieve and maintain that 37% prime cost if we don't raise the selling price.”

However, this is not the only reason why the food at the canteen is getting more expensive. A major factor is overall inflation and the rising prices of products. “For us, the jump in the prices of groceries which started in October had the strongest impact,” says Draganova.

The dining services use special software that calculates the price of each dish with respect to the recipe and the ingredients. “Keep in mind that when we form the prices, we do not include all costs such as salary, rent, and electricity. We form the prices only based on the products,” says Draganova.

The largest expenses come from the facilities. This is a sort of rent for the space in the building where the Hungry Griffin is housed. There are other additional costs like the maintenance of the machines, the staff salaries, the legitimate documents, and the electricity and water bills.

Draganova was quick to elaborate that the dining services are not able to cover all the costs mentioned above. “The canteen works with a budget deficit assigned by the board and we cannot cover all our expenses. If we decide to do so, the prices will be much higher,” she says.

Another issue that some students brought up in the survey concerns the price of the meal plan. In previous years the obligatory meal plan was $150 and came with a bonus of the same amount provided by the university. Since last semester students pay only $100 and do not get the bonus. “The university can no longer afford it,” says Draganova, “this bonus was given in a period when the dormitories were full, there was no pandemic.”

She is not sure whether prices could go up even more. “I talked to the executives but there is no tendency to reduce the requirements toward us,” Draganova says.