A restaurant should pamper its customers with a culinary experience. Unfortunately, that is often not enough. Restaurants have to be profitable in order to exist. Accordingly, the finances in the catering industry are always a hot topic. To do this, there must be a healthy relationship between costs and income. Even if the costs are known, it is often not easy to save money overnight without sacrificing quality. But how do you, as a restaurateur, manage to reduce or optimize costs while maintaining quality? The following tips and tricks can be a source of inspiration to achieve exactly this.
Costs – an overview
It is important to divide your budget correctly. As a rule, most is spent on personnel costs in the catering industry. This is around 44% on average. In second place are the cost of goods with 28%, followed by administration and insurance costs with 20% and rental and ancillary costs with 8%. These are guide values and can of course vary in your individual case. However, you should analyse your costs again more closely if your expenses are above the percentages presented for all guide values.
How to reduce fixed costs in your restaurant
As a restaurant owner, you rightly don’t want your money to go to waste. As we’ve already mentioned, labour costs can be one of your biggest expenses. Read on to find out how you can reduce them.
- Employ your staff optimally
Here are some tips on how your restaurant can optimally employ present and future members of your staff:
– Train your staff scrupulously and regularly.
– Create an employee handbook.
– Run your staff in different jobs so that they know how to fill various positions.
– Update your staff to hone skills and remind everyone of the ideal procedures.
– Make experts and beginners work together.
– On days when you expect little work, leave excess employees at home.
- Use technology
Technology has become an essential tool in the restaurant world, and there are more and more technological advances that can help you hire fewer staff, and therefore lower costs. Here are some ways technology can help you:
– Enable your customers to order to table, for click+collect or for home delivery – all from a single app. ROUND allows your business to access increased spend per head through promotions and upselling while maintaining tipping levels for your hard working staff.
– Use food delivery apps, such as Uber Eats, Deliveroo and Just Eat
Choosing how and where to cut to reduce staff costs can be a difficult decision for a restaurant owner, but there are ways to lower costs without having to lay off employees. By reducing staff costs and integrating new technologies into your restaurant you can reduce costs in the long run and increase revenue. Enable your customers to order to table, for click+collect or for home delivery – all from a single app. Increase spend per head through promotions and upselling.
Cost of goods – less is more
When it comes to goods costs, you can often save costs with simple tricks. It is often advisable for a company to keep a smaller menu in order not to have to keep too much food in stock. At the same time, the kitchen staff is less likely to be overwhelmed with the orders.
You can often put together different menus with the same food. This allows you to keep your warehouse smaller and you are less dependent on the menu choices of the guests. Depending on the concept, you can offer a daily changing (lunch) menu in which food that is currently in stock is processed. In summary, the following can be stated: Avoid overly large warehouses, especially with food with a short shelf life, and in any case avoid having to dispose of food.
Rent and ancillary costs – watch out for high ancillary costs
When it comes to rental costs, you can mainly optimize costs through good conditions in the rental agreement. If you start operating a new restaurant, short notice periods are worthwhile. Another option can be to make the rental costs dependent on the sales in the initial phase by letting the landlord participate. Basically: If the rental costs exceed 10% of the total costs, then it usually becomes critical.
Regarding the additional costs: It is essential to compare different providers and their prices. Since numerous machines, cold rooms, cash register systems and the like are required in the catering industry, the energy consumption is enormous. You should therefore compare all devices and machines in terms of energy consumption before buying and always use them as efficiently as possible. It can therefore be worthwhile to replace the old appliances and to lease new, energy-efficient kitchen appliances.