What commodity markets can and can’t tell you about your price.
Markets explain a lot of what you pay. They don’t explain all of it, and the gap is where overcharges hide.
When a vendor raises a price, the explanation is usually the market. Sometimes that’s true. Cheese follows block cheese, wings follow the wing market, fryer oil follows soybean oil. Watching those markets is the first way to tell whether an increase is earned.
Where markets stop being useful
Most products aren’t a raw commodity. A breaded chicken tender, a frozen pizza crust or a bottled dressing goes through processing, packaging and freight before it reaches you. Each of those has its own relationship to the market, and some barely follow it at all.
A market can also move without your price moving with it, especially on the way down. Prices that rise with the market and stay put when it falls are one of the most common patterns we see.
Measuring the product, not just the market
The Angel Index measures the market for each specific product, using purchasing data from across the network. Because that data is cost-plus, it shows how a product’s cost is actually moving, separate from the markup on top of it. That makes it possible to tell when your price should have moved, and by how much.
Angel also sends a weekly report on how the markets that drive restaurant food cost are moving. You can subscribe below.