Private clubs are caught in a financial vise: rising food costs, shifting tariffs, and evolving member expectations are forcing chefs and managers to rethink how they price, source, and sustain their culinary programs. Members may accept inflation in the outside world, but inside the club, they expect the experience to remain stable, creating a high-stakes challenge for those in charge.
As Mark Bado, MCM, CCE, General Manager/COO of Mizner Country Club in Delray Beach, Fla., aptly puts it, “The goal is to make no sharp turns and to keep a steady hand on the wheel.”
The Impact of Tariffs on Club Operations
Recent tariff policies have created uncertainty in food supply chains, particularly for private clubs that rely on imported seafood, meat, and beverages. Initially, the White House announced a 25% tariff on imports from Canada and Mexico, as well as a 10% duty on Chinese goods, effective February 1, 2025. However, as of early February, the U.S. has delayed the tariffs on Canada and Mexico for 30 days, while the 10% tariff on China has been implemented.
These tariffs—and the potential for additional ones—introduce uncertainty for clubs, which rely on international markets for high-quality ingredients.
- Seafood Imports: Canada is one of the top seafood suppliers to the U.S., exporting $3.6 billion worth of seafood in 2023. With 70% of whole salmon imports and a large percentage of lobster and snow crab coming from Canada, any future tariffs could lead to price hikes and limited availability.
- Meat & Dairy Disruptions: The U.S. meat industry is also under pressure, as live cattle shipments from Mexico and Canada could be disrupted, potentially increasing the cost of premium beef cuts.
- Beverage Price Increases: Canada’s retaliatory tariffs may target alcoholic beverages, impacting wine lists and bar offerings.
- Frozen Seafood Price Increases: Philip Wolf, a Sales leader with Buckhead—a leading meat and seafood distributor—notes that most frozen seafood will see an immediate increase of at least 10% because, even if sourced domestically, much of it is shipped to China for processing. Vendors are stockpiling and freezing products in anticipation of further tariffs.
- Lobster and Crab Supply Strategy: Wolf also revealed that a significant amount of lobster and crab has already been imported into the U.S. ahead of the tariff enactment, ensuring some short-term stability in supply. However, Wolf urges clubs to “stay on the positive side of purchasing” by monitoring inventory levels and planning accordingly.
With these potential cost pressures looming, clubs must take a proactive approach to mitigating the impact while maintaining their standards.
Understanding Cost Structures
Mark Bado, MCM, CCE, General Manager/COO of Mizner CC, emphasizes the importance of steady financial management in navigating rising food costs and member expectations. At the 2025 Chef to Chef Conference, he will lead the session Kitchen Math: Understanding the Numbers Behind Culinary Operations, helping chefs sharpen their financial acumen. Register here.
Clubs don’t run food and beverage operations to turn a profit—we run them to serve members. Unlike restaurants, which rely on margins from every dish sold, we operate under a subsidized model where member dues help offset costs across dining, golf, tennis, and other amenities. That structure allows clubs to prioritize experience over profitability, but it also means that rising costs—whether from tariffs, labor, or inflation—require careful financial planning.
“Everything we do is subsidized,” says Bado. “Finance committees and boards determine the level of subsidy through dues. Our three biggest costs are labor, cost of goods sold, and supplies—with supplies being the smallest by far.”
That financial framework creates a distinct cost structure. While restaurants typically aim for a cost of goods sold (COGS) between 28-40%, clubs often see figures in the 40-50% range or higher. Banquet vs. A la carte mix plays a major role in overall success, but profit isn’t the goal. Events, for example, are designed to enhance the member experience rather than generate revenue.
This means that while clubs are affected by rising costs, they have tools beyond menu price increases to adjust. Strategic dues allocations and long-term financial planning will allow clubs to absorb fluctuations while maintaining the standards members expect.
Managing Member Expectations in a High-Cost Environment
One of the biggest challenges clubs will face is managing members’ perception of value. While members recognize rising prices at grocery stores and restaurants, they often expect their club’s pricing to remain stable, seeing it as a benefit of the dues-based model.
“Members are very aware of price increases outside the gates of our communities,” says Bado. “But they also feel that ‘we pay these dues, so our prices should be managed.’ Will they complain? Yes. But they’ll keep coming back because they’ve made a lifestyle commitment. Regardless of perception, the luxury a club provides comes at a cost.”
This dynamic creates both a challenge and an opportunity: clubs must balance pricing decisions with clear communication, reinforcing the value of the experience while maintaining financial sustainability.
The Cost Squeeze: Understanding the Financial Pressures
The all-food Consumer Price Index (CPI) has surged by 25% from 2019 to 2023, and while inflation has slowed, cost increases continue into 2024. A mix of supply chain disruptions, climate conditions, and disease outbreaks are driving prices higher across key food categories:
- Beef prices rose 4.9% in 2024, setting all-time records for cattle pricing.
- Eggs spiked 37% due to the impact of avian influenza.
- Chocolate saw a 10% increase in 2023, followed by a staggering 50% jump in 2024.
- Olive oil has skyrocketed by 113% over the past few years as adverse weather hinders harvests.
- Petroleum-based goods such as food-safe gloves and plastic wrap rose 20% in 2024.
- Dairy prices climbed 17.3% over the past several years, driven by rising feed costs and supply chain interruptions.
These rising costs put added strain on operations where financial models prioritize experience over profitability. While restaurants might offset increases through immediate price hikes, clubs must take a more nuanced approach.
Strategies for Managing Cost Increases Without Member Backlash
Rising food costs, shifting tariffs, and inflationary pressures are likely unavoidable, but how clubs handle them can make all the difference in maintaining member satisfaction. Thoughtful planning and strategic communication can help offset financial strain without compromising experience.
- Transparent Communication
- Keep members informed about the challenges of food cost inflation and tariffs.
- Use newsletters, member meetings, and menu highlights to explain sourcing efforts and quality retention.
- Strategic Menu Adjustments
- Shift focus toward seasonal and locally sourced ingredients to reduce reliance on international imports.
- Introduce flexible pricing models (e.g., premium offerings with added value, such as wine pairings or pre-ordered cuts for weekend service).
- Closely monitor menu sales vs. item margins and change menus as frequently as needed to maximize “stars” and eliminate “dogs.”
- Supplier Negotiations and Inventory Management
- Lock in pricing with vendors when possible.
- Consider alternative suppliers or domestic sourcing to minimize tariff exposure.
- Encourage preordering for high-cost items, as some seafood vendors are limiting purchases due to uncertainty.
- Stay on the “positive side” of purchasing by leveraging freezer space when deals are available, ensuring a steady supply before price hikes take full effect.
- Optimizing Labor & Operational Costs
- Since labor is one of the largest costs in private club dining, review staffing models to ensure efficiency without sacrificing service quality.
- Evaluate kitchen operations and waste reduction strategies to improve overall cost management.
- Rethinking Banquet and Event Pricing
- Since banquets are major profit drivers, clubs must leverage banquet pricing to keep a la carte pricing as low as possible, based on a club’s banquet to a la carte ratio.
- Consider price adjustments on high-cost club event menus while keeping base member events accessible. Incrementally adjust club event pricing on an annual basis.
- Costing goods on a more frequent basis can help you to stay on top of ever-changing cost changes and keep monthly inventories up to date.
Clubs that take a measured approach and communicate effectively can navigate the challenges of tariffs and inflation without compromising standards. Maintaining financial stability requires strategic adjustments, clear member communication, and a focus on value-driven offerings. With careful planning, clubs can uphold the experience members expect while adapting to the evolving food and beverage landscape.
