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Your profitability determines whether you will swing the doors open for another day of business or turn off the lights for good. Profit margins run the gamut in the restaurant business. Research shows that the average is between 3% – 5%, but can range anywhere from 0% – 15%. To squeeze out as much profit as possible and grow your restaurant’s revenue, you really only have two options – decrease expenses or increase your sales volume. What if you could simultaneously do both, while enriching your sustainability practices? A win – win – win proposition to be sure!  

Take sustainability and profitability to new levels

Whether you’re just starting to adopt eco-friendly measures or have been at it a while, it’s an ongoing process that always leaves room for improvement. Just as you wouldn’t leave hard-earned money on the table, you don’t want to miss any simple to implement green practices that can boost your profitability. Let’s take a look at how sustainability initiatives can grow your restaurant’s revenues.

Cut expenses to the bone

There are a number of eco-friendly ways for you to slash expenses. The easiest and probably the most obvious is to reduce waste. Here is where the Environmental Protection Agency’s (EPA) Food Recovery Program Hierarchy comes into play. Are you doing everything within your power to prevent, recover and recycle waste; or are there still some gaps that need to be plugged. 

  • Take waste out of the equation: Is your restaurant still tossing a substantial amount of unusable food? If so, it’s time to take a closer look at your inventory processes to ensure that every ingredient purchased is being used. If you’re already maximizing the use of all ingredients, what about the amount of food diners are leaving on their plates? If uneaten food is being returned to the kitchen, reduce portion sizes and watch as plates are returned ready for immediate dishwashing. Let’s say you already have this covered. Food usage and waste are being tracked, and your food costs have decreased by up to 6%. It’s time to explore other sustainability measures that will add even more to your bottom line.  

Buying in bulk minimizes unnecessary packaging, while reducing ingredient costs. To get the most out of bulk purchases, be sure you’re working with vendors that strive to minimize waste. Are your supplies and ingredients being shipped cross-country? If so, you’re paying a premium for long-distance transportation, not to mention the environmentally harmful carbon emissions caused by unnecessary travel. Now’s the time to take a close look at your supply chain. Buy local when you can and visit farms to get the best deals possible. When it comes to produce, vegetarian and vegan dishes have a higher mark-up. What better way to further maximize your profitability than to create a garden of your own and use the fruits and vegetables that you grow.

  • Make a swift recovery: The next step in the hierarchy is recovery. This is your chance to help those in need. You will significantly reduce waste and ultimately your disposal and hauling costs. According to Rethink Food Waste Through Economics and Data (ReFED), there are approximately 1.5 billion meals each year that go uneaten. This astronomical figure equates to just 10% of food service and restaurant food being recovered. Not only will you be helping others, but there is a financial benefit for you. By donating to a 501(c)3 not-for-profit qualified charity, you can receive tax incentives! 
  • Revisit recycling processes: You’re probably already recycling common items such as cardboard, plastics, glass, metal and aluminum. But there are other recyclable items that are frequently overlooked – light bulbs, printer ink cartridges, batteries, multi-use plastic trays and multi-use plastic baskets to name a few. And what about cooking oil? This is a growing industry that needs your old oil to produce various types of biofuels for power generation and heating. By increasing your recycling practices you will not only save money on trash removal, but reduce your carbon footprint. 

Reduce expenses even further and give mother nature a helping hand. Take a look at your utility bills. Are you paying more than you need for water and electricity? Simple measures such as fixing dripping water faucets and providing diners with drinking water only when requested will have a positive effect on your next water bill, while helping to preserve our dwindling water supply.

By adjusting the thermostat just a few degrees you can shave as much as 9% off your next electric bill. And on nice days turn off your HVAC. Open the windows and let the fresh air in.

Turn up your sales volume

Now that your restaurant is on its way to green, it’s time to promote your efforts. Use your menu to inform diners that your produce comes from sustainable local growers. For example, rename your vegetarian pot pie to Sunrise Farms Vegetarian Pot Pie to advertise that the vegetables used to make the pot pie came from a neighborhood farm. 

Get involved with the community to further promote your sustainability efforts. Fairs, arts and craft shows, farmers market events, etc. can be the perfect venue to increase your clientele. Sell or provide samples of your eco-friendly dishes and perhaps even offer limited time discounts to potential new customers.

Worried that increased prices for your sustainable meals will have the opposite effect. Consumers in general are increasingly patronizing eco-friendly establishments and are willing to pay more. This is especially true for Millennials and Gen Zers. 

The path to green just got greener

With a little effort, both you and your restaurant will be in the green. In fact, according to ReFED, restaurants that adopt sustainable measures could realize an additional $620 million in profit potential on an annual basis. So what are you waiting for? Go green and watch your revenue grow!

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