6 Foolproof Restaurant Cost Management Techniques
The slow and gradual return to society will undoubtedly look different. Returning to the life of crowded subways, bustling office buildings, and overflowing nightclubs seems unreachable. In contrast, diners today are eager to return to restaurants more than ever before.
Through all uncertainty, one thing’s for sure. Providing an exceptional dining experience will determine the success of your business. However, what makes up that exceptional dining experience has changed.
Let’s dive a little bit deeper into how you effectively improve your customer experience while saving on costs in the next 30 days.
1. Audit Your Back of House and Document It
In the last year, you’ve probably made changes on the fly on a daily basis. Spending an hour to review your back of house can help build a strong foundation for financial success this year.
Although you may have an idea of what’s been going on in your head, documenting your challenges will help hone in your greatest areas for improvement and help you communicate them with the right stakeholders.
- What is your current ordering process?
- How are you receiving orders?
- How often do you count inventory? Why?
- Who is in charge of the inventory process?
2. Negotiate With Your Food Suppliers
Reducing costs, monitoring inventory, and tracking ingredient costs can seem like the never-ending tasks and responsibilities of running a restaurant. One of the most impactful cost-saving techniques is to pick up the phone and build a relationship with your food suppliers.
If you don’t have an inventory platform like MarketMan to track ingredient prices across multiple suppliers, consider building a long-term relationship with a sole supplier for the majority of your inventory items.
Building a strong relationship is a win-win situation that helps you save big on food costs. Suppliers get a loyal customer who orders at higher volumes. In turn, suppliers can help work with you whenever you have a bad stretch or if you need any ingredient replacements.
3. Hone in on Your Marketing Messaging: Communicate Your Food Safety Protocols
There are a million ways to market your restaurant and nobody has time to test out every new promotion or message. The latest research suggests that restaurant goers value the taste of food, food quality, and sanitation standards above-price of menu items, convenience of location, or even providing healthier food alternatives.
In 2021 and beyond, it’s integral that you not only maintain excellent safety protocols but effectively communicate them with your current and future customers.
Investing in your brand is one of the best ways to save on costs. You can more easily acquire new customers, retain your most loyal customers, and make it easier for your customers to say yes to returning.
Two Ways to Increase Food Safety Transparency
- The first step is to ensure your staff feel safe and trained to keep the workplace safe. Mandate and reinforce regular employee training. Consider taking ServSafe’s free COVID-19 training courses.
- Place accessible hand sanitizing stations around the entrance, cashier, and each dining table.
Source: New York Times
Ready to hone in on your marketing messaging? Download the 6 Foolproof Restaurant Cost Management Techniques ebook today and get access to all the ways you can increase food safety transparency.
4. Save on Food Delivery
It’s a no-brainer that right now in the COVID era, online ordering is a must-have channel for restaurants to keep their businesses afloat and to stay competitive. But with the rising importance of digital adoption and the changes in diner consumption, it’s clear that off-premise dining is not temporary, but here to stay. In fact, 53% of adults say purchasing takeout or delivery is essential to the way they live.
Don’t know how much you’re losing out on food delivery? Use MarketMan’s free food delivery calculator template available in the ebook today!
Contactless ordering has become the new norm and an incredible revenue stream for restaurants. The biggest draw for these delivery apps is discovery: the potential to acquire new customers.
With already thin margins and increasing food costs, losing out on a 30% on plate costs is not a sustainable way to run your business. Here are a few ways you can reduce your delivery costs:
- Stick to your most profitable ordering methods
- Improve operational efficiencies
- Adopt a commission-free online ordering system
- Negotiate your third-party fees
"When you do all of the things that the third party apps do, you will get your guests to order from you and you only, and also at a higher frequency."- David “Rev” Ciancio
Download the 6 Foolproof Restaurant Cost Management Techniques ebook today and get full access to actionable strategies you can apply to reduce your delivery costs.
5. Systemize Brand Loyalty
Maximizing customer lifetime value goes hand in hand with cost management. It costs more to acquire a new customer than to retain an existing one. In fact, returning customers are willing to spend 76% more than new customers.
With already thin margins, it doesn’t make financial sense to spend thousands on acquiring new customers every month. While we used to focus on providing great customer service and developing 1:1 relationships with guests in person, it’s much more challenging now to do that in the COVID era.
This is why adopting a restaurant loyalty program, especially now where all businesses must adapt to being digital first, can be a key strategy in helping restaurants drive repeat business effectively and to get diners to spend more.
6. Streamline Your Operations with Integrated Restaurant Technology
Investing in technology allows you to focus on expanding your restaurant without spending time on menial tasks. Here are a few reasons why technology can help save on costs.
Technology Helps Reduce Employee Turnover
With employee turnover as high as 70% in the restaurant industry, a simple-to-use system will improve employee retention. Take time to train your employees and avoid common pitfalls by taking note of them and including them in future training sessions.
Anticipate that setting up a new piece of technology will require training and time investment. Avoid “set it and forget it” solutions where you receive little to no support after they lock you in for an annual contract. A quality customer success team that helps you with the setup and training process can be the key to transforming your business operations for the better.
Less Spreadsheet, More Automation
Data-driven restaurants are using it as a competitive advantage to improve operational inefficiencies, update menu items, and communicate directly with customers. Established brands can utilize historical data to maintain market share and serve customers more effectively.
So instead of scrambling last-minute for additional servers, your analytics can take the guessing game out and show you which days, weeks, or months you’ll need to adjust staffing numbers. Your data can also show that your sales are extra slow during lunch hours on Wednesdays, and help plan your promotions accordingly.
Download the 6 Foolproof Restaurant Cost Management Techniques ebook and get instant access to profitable ideas you can start implementing today, a free food delivery calculator template, a step-by-step audit checklist to streamline your back-of-house, how to effectively communicate with your customers, in-depth tips for loyalty programs, and more! To see how you can transform the way you do business with technology today, check out MarketMan to get started.