January is always one of the slowest months of the year for the restaurant industry. To start the year off right, you’ll want to find a few ways to reduce expenses during the “lean season.”
There is power in knowing your numbers. The popular reality shows like Restaurant Impossible and Bar Rescue focus heavily on weak owners and managers who can turn the failing business around by simply understanding their numbers. Do you know yours? Here’s 10 ways knowing them can help increase your bottom line:
- Knowing your food costs can help you analyze your menu. Does every item make you money? If not, you need to adjust the price or it needs to go.
- How much are you paying in vendor costs? Can you consolidate orders with fewer vendors to save money?
- What items make you the most money? Are they prominently featured on your menu and in your social media advertising?
- Some ingredients have drastic seasonal price changes, or are subject to supply and demand fluctuations. Look for ingredient substitutions to keep your costs down, or eliminate unnecessary ingredients from the recipe.
- January is the month of the New Year’s resolution diet. Using smaller dishes will make plates look fuller with smaller portion sizes. Saving money and marketing promotion rolled into one.
- Go further than your ingredient costs. How long does each menu item take to prepare? Labor intensive dishes may not be profitable to keep on the menu.
- There is a reason corporate restaurants measure food and ingredient portions rather than eyeballing it – it works. Keeping portion sizes in line keeps you on budget and profitable.
- Food waste is a preventable loss. Doing a daily inventory will identify food items on hand so you don’t over order or know what to use in your next day’s special of the day. Creatively use kitchen scraps for soups, stews, garnishes or stocks.
- Have as few ingredients as possible in your menu. Use each ingredient in several dishes. This reduces food waste, allows you to buy at quantity discounts, and keeps your ingredients fresh with rapid turnover.
- Streamline your menu. Reducing the number of items will increase profits.
Bonus tip: Ask and ye shall receive. Ask your vendors what bulk savings you can take advantage of and for “unadvertised” discounts.