The cost to produce goods rises much more rapidly than what you can actually sell your product for. People would simply stop buying if you increased prices 12-13% every year (which is what is typical for me in the restaurant industry in Mexico)
New entries usually start with a lower quality product by default, so you usually have to keep prices and drop quality if you don't want to be priced out (or move into a far more upscale and finicky market).
My company (not an owner) is a services based company with yearly agreements. We bake in price increases annually with inflation.
If you are not a business running on fixed agreements, you have the right to increase your prices whenever to accommodate your costs. If your idea is that consumers will just go somewhere cheaper, then it works upstream too - you have the option to source your products / goods from somewhere cheaper as well.
If there is no cheaper alternative for you, then there must be no cheaper alternative for your consumers, unless you aren't operating your business in an efficient manner. In which case the market will either force you to, or you will lose your business.
The cost to produce goods rises much more rapidly than what you can actually sell your product for. People would simply stop buying if you increased prices 12-13% every year (which is what is typical for me in the restaurant industry in Mexico)
New entries usually start with a lower quality product by default, so you usually have to keep prices and drop quality if you don't want to be priced out (or move into a far more upscale and finicky market).