Taco truck economics: How inflation affects LA’s entrepreneurs

Typically, wholesale price increases mean business owners pass their higher costs onto their customers. But what happens when your regulars work at the bottom of the wage scale? It’s a very difficult position for many small business owners in Los Angeles.

Clothing. Food. Gasoline. It seems like everywhere you look, prices for everyday things keep on going up. Inflation rose nearly 7% in the U.S. in 2021 compared to last year —  the highest increase since the early 1980s. 

KCRW caught up with a couple to find out how they’ve adjusted their prices and are preparing for the new year.

Elizabeth Garcia, owner of La Patrona

Elizabeth Garcia runs a breakfast and lunch cart in Boyle Heights called “La Patrona.” She earns $350-$500 in sales each day. But as prices go up for her everyday ingredients, from food to fuel,  it’s eating into her profits. 

Benjamin Gottlieb: How much have the prices gone up for some of your staple ingredients? 

Elizabeth Garcia: The biggest impact [of inflation] for me is the price of my raw materials, so the price of meat, vegetables; also the price of disposable goods: cups, forks and plates. To give you an example, onions are one of the main ingredients of my cooking. Months ago, I was getting a bag of onions for $14 to $16, depending on the quality. Right now it’s $24 to $27.

Did you raise your prices? And if so, how did that go over with customers?

Yes, I tried raising my prices to cover my increase in costs. But then I noticed that many of my customers were ordering less. Others stopped coming altogether. So I had to bring my prices back down. A lot of my customers make minimum wage, and so this inflation …  really affects them too. Right now, my tacos are $2.25. I would need to charge at least $2.50 to make up the cost of inflation. So I’m just eating the extra cost right now. 

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