The past year has been especially tough on restaurant owners. Unfortunately, many great restaurants were forced to close as they could not operate under new restrictions.
For those who were able to weather the storm, many are still fighting to stay afloat and provide their customers with great food and service that they are accustomed to. Capacity limits, hour restrictions, and changes in consumer behavior have kept restaurant owners on their toes and have made it critical for many restaurant owners to find cost savings anywhere they can. To help restaurants that are continuing to bounce back from COVID-19, we wanted to offer 6 ways to cut costs in your restaurant.
Restaurant Labor Cost
Depending on the type of restaurant you operate, labor costs tend to be typically your highest or second highest cost. The old way of thinking is to pay your employees as little as possible in order to get this cost down, however this will lead to employee burnout and high turnover.
High turnover in a restaurant can lead to increased labor costs as you may have to pay managers or other employees overtime for training when instead if you pay a fair wage upfront, it will lead to less turnover and increased employee morale. There are other indirect ways you can reduce labor costs which are explained in our other points below.
Cut Food Costs
Other than labor, food costs tend to be the next highest cost when operating a restaurant, and in some cases it is the highest. Especially if your restaurant is not optimizing inventory properly. One of the easiest ways to cut food costs in your restaurant is to measure portion sizes by using scoops or portion cups for every plate that is sent out of your kitchen.
This makes your employees’ jobs easier by taking the guesswork out and will also cut food costs as you reduce the risk of over-portioning.
Become More Efficient in Processes
Like many industries in the restaurant business, efficiency is critical and can be the difference in profitably month to month. The key to becoming efficient in your processes is not to overthink, instead it is to streamline actions and job duties to meet customer demands. Restaurants can be a hectic place to operate so one key is making sure that your employees do not have to do too much bouncing around from one area to another. Having assigned stations for employees to do only a couple tasks over and over again is key to operating efficiently in a restaurant. Having your kitchen operate more like an assembly line vs. a free for all will lead to faster ticket times and lower employee stress.
Another must have for every restaurant is a recipe book for your kitchen staff to refer to. This helps in streamlining the training process as well as gives employees a reference for anything they have to prepare. By combining your measured-out portions and a complete recipe book for all of your menu items, you make your employees’ jobs easier and save money in the process.
Reduce Prep Times
Reducing prep times is a hard cost to categorize as it encompasses a lot of different costs in one. This is a culmination of labor, food, utility costs, and also the opportunity cost of not turning tables over faster than you could be. By reducing the prep time needed you can save hours off of payroll by allowing staff to show up a little later than normal as well as speeding up your average time per ticket.
Reducing prep times is a specialty of Gulf Coast Blenders and one of the advantages of using a custom blend. We reduce prep times by having your specific formula for any of your batters, seasonings, marinades, or doughs pre blended in our New Orleans warehouse. This way you can ensure your products will remain consistent without the added time, stress, and labor.
Rent and Utility Costs
While there is no way to lower your cost of rent unless you negotiate with your landlord, there are a few simple ways to lower your utility costs. One of the easiest ways to cut utility costs is to turn off utilities that are not being used. Devices such as motion detected lights in restrooms that prevent the restroom lights from being on constantly, to cutting the cord on cable. Most restaurants only use a couple of different channels, so why pay for the full commercial cable package? Either cutting cable completely or switching to a streaming service that meets your customers expectations, can save hundreds of dollars a month.
Sharing Marketing Costs
Marketing has become a critical point of emphasis for every business no matter the industry but especially for restaurants. The introduction of google reviews, Yelp, and other online ordering platforms such as Uber Eats, Waitr, & Door dash has created a space where your images, menu and most importantly reviews speak for your restaurant long before many customers ever step foot inside your doors.
Creating relationships that work for both parties can be a very effective way to mitigate marketing costs.
This can look many different ways.
From vendors helping supply restaurant collateral such as table toppers or menus, to full-fledged marketing campaigns with help from your vendors. At Gulf Coast Blenders we strive to be the industry leader in content marketing for both ourselves as well as our customers. Since some of our customers prefer our relationship to be private, we have many ways to assist in marketing without being explicit in stating our relationship.