It’s time to face facts. Costs of ingredients are going up because of inflation, making grocery shopping for your food service establishment difficult. Inflated prices are even making it hard to control your budget and pay wages. How do you keep costs manageable while ensuring you have enough products for in-person dining and orders from your online ordering system? There are creative ways to do so but first…
Expenses –What They Are and What is Involved
1. Cost of Goods Sold – These include the ingredients you need to create your dishes and drinks.
2. Operations – This includes everything from equipment and utility costs to rent or mortgage, and marketing.
3. Labour – This involves everything from salaries to benefits.
How to Keep Turning a Profit
There is a lot to consider with restaurant management, but you can keep your business in the black and keep it growing. All you need are these essential tips.
- Adapt – Adaption can help you succeed. It may be time to re-work your menu. Make your menu smaller but still offer a fair number of choices. Keep the menu options that are popular with existing customers. If people are happy with your offerings, they won’t mind if there are fewer choices. You can even use ingredients in multiple ways by creating dishes using the same product but with different methods of cooking.
- Small Price Increments – If you would rather not cut down on menu options then you can raise your prices to match the current state of the market. Be careful to increase the amounts gradually. Start by charging a 10% increase, then follow it up with an additional percentage to meet your budget demands. Gauge your price increases by your customer reactions. If you receive multiple negative reviews, you can always offer a discount to repeat clients or revert to a lower price point. Stick to a dollar amount that is consistent with your competitors to avoid pricing yourself out of the market.
Keep your customers in the know about upcoming changes such as this. Post something on social media or make a note on your web page’s online ordering system. Say something like “We want to ensure we give you the utmost quality and as you know food costs have gone up. To keep providing excellent quality meals we must increase our prices and hope you understand. Thank you for your continued support.” Honesty and transparency help you to stay connected with your customers, earn their understanding, and build trust.
- Negotiation – Reach out to other suppliers from the one you currently deal with to see if you can get a better deal. Maybe the company you are familiar with will match the price of their competitors. You may be able to negotiate a lower cost on certain ingredients if you order larger quantities or sooner than normal.
- Partnership – Do you have friends in the liquor or dessert industries? See if you can make a deal with them by having them supply you with products at a lower cost by offering compensation in the form of a complimentary drink or appetizer every month. This can help reduce your costs while bringing in more business when your friends bring their friends in to take advantage of the deal.
- Energy-Efficient Equipment – It can be a good idea to switch out your current gas stove for a more energy-efficient, induction one. By utilizing current technology, you can save costs and still have quality equipment that works well.
- Find a New Space – Maybe it’s time to move your restaurant to a new, less costly location. If the price of your rent or ownership fees has become too high, seek out a different space. Be sure to tell your customers ahead of time so they know where to find you. While this will not affect your online ordering system, in-person diners need to know. A new location can increase your customer demographic and bring in new clients.
- Mind the Gap – Mind the gap is a phrase that rings quite true here. If you have a ton of staff on during slow times, you can change your restaurant operating hours to focus on the busy times and close during slow periods. You can save money on wages and reduce the number of staff needed to keep operations flowing smoothly.
- Bonuses – It can be expensive to hire, and re-train new employees so take care of the ones you have. Offer bonuses to hard-working, committed staff members to show recognition for their dedication to your food service establishment. This solidifies your employees and can reduce the costs associated with hiring new ones.
- Encourage Online Ordering – With more orders being sent out of the kitchen and directly to a customer’s home there is less staff needed. With fewer staff, you have fewer costs to worry about. When a lot of your orders are take-out or delivery you can eliminate the need for servers.
Finally…
An online ordering system from 247 Waiter is a great way to utilize advanced technology and help beat inflation. A one-time fee gets you a website and all the tools you need to get your food delivery system up and running.