Basing your prices on competition's is what was called the
"no-method-method" in our textbook when I was in school, and the most risky.
BUT, if your prices for a similar product are higher than your competitors'
you will need something to increse "perceived" value. Either, exceptional
quality, swift and polite service, ambience or some other reason one will
choose to go to your cafe and perhaps spend more. Some people will spend
more for a view or wide-screen sports tv, rather than looking out at
run-down scenery with a noisey radio blaring from the kitchen. But the way
things are lately, many may be less concerned about ambience than economy.
So..... try to add some especially low cost (your cost) items that "sell
like hotcakes" Or... add items that no one else makes available but are not
too expensive to produce or too exotic. I am constantly amazed what people
pay for processed "health foods" and foodbars in my area ($6.50/lb for hot
food and make your own salad??), but I would personally never go that route.
Having studied nutrition, whole foods- freshly prepared is the base of
healthy eating and as "specialized" as I need to get.