Watching the bottom line is essential to operating a profitable business, and finding ways to alleviate rising food costs in your restaurant is crucial to success. With today’s escalating transportation costs adding to the variable price of inventory, it can be extremely difficult to monitor profit and loss areas without software that is designed specifically for the restaurant and food service industry.
The following list provides 6 ways to alleviate rising food costs in your restaurant for increased profits.
1) Monitor P&L Daily, Weekly and Monthly
The restaurant and food service industry requires you to vigilantly monitor your profits and losses in order to succeed. The average profit has decreased significantly from an average of 18% to 24% to an average profit of 6% currently, which means only a slight increase in losses can severely impact success and must be caught and corrected as soon as possible.
2) Eliminate Waste
Eliminate waste in the kitchen through every available means. Calculating portion costs and implementing portion control, and monitoring the results is one of the quickest ways to turn around losses. Perishable items that become outdated or are past their prime quickly drive up costs as does the practice of ordering items that are out of season. Weigh and measure portions consistently.
3) Keep Records
Keep records that include inventory and food waste, and personally take stock on a regular basis. All food, beverages and other items should be accounted for as waste can quickly eat up profits.
4) Order Food from a Food Service
Ordering food from a food service is typically less expensive than purchasing it at a nearby market. Over and under ordering can both add to your overall costs, although in different ways. A quick turn around is important in this industry, as perishable items go bad and frozen items can become freezer burnt or develop an old flavour. Orders that are short often mean filling in from local suppliers who not only charge more, but may not carry the same quality of food.
5) Build Relationships
Relationships are important throughout the food service industry. Building a strong alliance with suppliers, employees and customers is crucial to your success. Knowing what specials are offered by suppliers can help with menu planning for increased profits. Employees who are preparing and serving the food need to care about the business and feel appreciated, while also understanding that it is a business. Customers walk through the door for a good meal and great atmosphere, meaning quality meals at affordable prices is important.
6) Implement Inventory Control
Implementing inventory control software provides restaurant owners and managers with the tools they need to determine where waste occurs and to monitor inventory. Becoming pro-active with easy to use software can help you quickly determine when losses occur and why. Equally important, you will be able to plan menus and set prices quickly and easily based on current supplier costs as well as changes in operating expenses.
Now it’s your turn. How do you control food costs in your restaurant? Leave a comment below.
For more info on Ideal Software’s Inventory Management system follow the link IdealStockControl
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