If your tables are full every night and yet it seems like you’re bleeding money, you might be wasting a lot on things that simple cost reduction techniques can avoid. Below, I will tell you how to save money as a restaurant owner without sacrificing quality or customer experience. Check out these simple cost reduction strategies in restaurants.
From food to labor and everything in between, here is where and how to cut costs to maximize restaurant profitability.
1. Identify high-cost, low-profit items in your menu
Most restaurant menus have certain items that, despite costing a lot to make, don’t sell very well. These are what’s bleeding you dry. If people aren’t into them, there’s no point in keeping them around. Wave them goodbye and replace them with items you know (or suspect) your customers would love to try.
2. Be mindful of customer food waste
Do you regularly throw away leftover food on customers’ plates? You might as well throw your money straight into the trash. Reconsider your portion sizes if most customers can’t finish them. They won’t know the difference, and you’ll stop wasting food.
3. Optimize your supply chain
Identify gaps in your supply chain that are losing you money, and as much as possible, try to stick to one provider. Paying multiple delivery fees can be detrimental to your business. If you can find a supplier selling most of the ingredients you need, give them a chance, and you might save some money.
4. Streamline your menu
Your menu doesn’t have to be pages long and try to cater to everyone’s tastes. In fact, the longer the menu, the less decisive and satisfied your customers will be. If your specialty is pizza, there’s no need for you to also serve burgers, pasta, barbecue, salads, and so on. Avoid the paradox of choice by simplifying your menu to focus on a few things you do well.
This will improve efficiency in the kitchen and inventory management. It will also provide customers with more high-quality meals in less time.
5. Avoid overstaffing
Overstaffing is a common problem for restaurants and one that can lead to massive money waste. Learn when your slow periods are so you don’t have employees standing around doing nothing.That said, make sure you have enough staff during rush hour to avoid the opposite effect.
6. Hire smartly
Learn how to control labor cost in your restaurant by hiring the right people from the start. But what does it mean to be the right person for your restaurant’s staff? You need employees who understand your restaurant culture and will fit in immediately.
Don’t let someone’s lack of experience deter you from hiring them. As long as they seem right for the job and are willing to be trained, it might be worth taking a chance on them. To cut labor costs, hire people who are excited to work with you and want to be there in the long run.
7. Optimize energy usage
You can do small things to reduce energy usage that don’t take long and require no extra effort on your part. For example, soak dishes before washing them and only run the dishwasher when it’s full.
When it’s nice outside, open the windows and shut down the AC to save energy. Replace all bulbs with energy-efficient ones and consider buying energy-efficient appliances. Things like these can make a difference.
8. Take advantage of free marketing
Promoting your restaurant doesn’t have to make a hole in your budget. There are a ton of free or almost free marketing ideas for restaurants that you can use. Think about writing a blog, friends who promote your place, customers who are happy tell the word further and more.
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9. Reduce paper use by going digital as much as possible
Organizing your kitchen, inventory, and finances digitally will make your job so much easier. Not just that, but it will also reduce costs on file folders, reams of paper, and so on. Keeping digital files of everything and backing them up regularly will reduce costs and increase peace of mind.
10. Optimize your menu for delivery
Not every item on your dine-in menu will be suitable for delivery. Some dishes just don’t travel well. It’s better to create a delivery-only menu with limited items. This will mean fewer ingredients, so less money spent, and also less prep time. You will then be able to fulfill more orders in less time and earn more at the end of the day.
11. Support your staff
This is a tough time for everybody, especially for restaurant industry workers. Keep employee morale up by letting them know they can come to you with any issues and making an effort to celebrate their successes.
If the worst comes to happen and you find yourself without tasks to give to your front-of-house staff, ask them if they’d be willing to deliver for the time being. They will most likely appreciate your effort to keep them instead of letting them go.
12. Try negotiating with your landlord and suppliers
Suppose you have a good relationship with your suppliers. In that case, you can negotiate the price of ingredients based on extraordinary circumstances. You can do the same for rent or even utilities.
Have you tried calling your utility company and negotiating a package deal? You can leverage your long time as a customer if that’s the case and suggest your budget might force you to switch providers.
There you have it: 12 cost reduction strategies in restaurants that will boost your profits without sacrificing the customer experience. With a little bit of organization, creativity, and attention to detail, you can implement all these techniques in your restaurant. Do you want any other tips on how to cut costs in the restaurant business or you need help in your restaurant? Let me know!
Thank you for reading my blog. If you want more information or help with reduce costs, Heemskerk consulting can help you. Feel free to contact us: www.heemskerkconsulting .com