Home > Blog

5 Ways Restaurants Can Cut Costs

Whether you are struggling with the after-effects of a particularly dull sales period or looking to revamp your restaurant business, budgeting and cost-cutting are the top-most priorities of the restaurant owners to make their business profitable.

Small profit margins and high completion in restaurant industry further make cost-cutting an essential aspect of any food business. Right from choosing the best yet affordable restaurant supplies, optimizing the inventory to reformulating the menus & recipes restaurants do everything to save some bucks.

If you’re in the restaurant business and looking for smart and efficient ways to cut costs, here we are discussing the top 5 ways restaurants can cut costs and make their businesses more profitable in long-run-

1.     Make the right choice of restaurant supplies

Choosing the most efficient piece of restaurant supplies is a great way to start cutting down the restaurant costs. In fact, having the right tools and supplies means the world in any food or restaurant business. The restaurant kitchens are heavily dependent on high-quality equipment and restaurant supplies such as ovens, fryers, blenders, steamers, grills, garland range etc.

These restaurant supplies make a large part of the restaurant's utility bills and overall cost head. The first and foremost thing to do is replacing the outdated appliances and equipment with energy-efficient restaurant supplies models from a qualified service provider such as Nella Cutlery. Not only it will help you save money on the utility bills, the high-quality restaurant supplies will also maintain the proper ventilation system in the restaurant kitchen, saving further can cost on electricity bills.

Below are few tips to choose right restaurant supplies and cut cost:

  • Pick as per the theme: There are plenty of options available to choose from when it comes to restaurant supplies of different make, models, and varieties. However, it is essential to use discretion and find the equipment, cutlery, and other restaurant supplies that match the theme of your restaurant instead of wasting money on assorted buying.
  • Consider maintenance: While choosing the restaurant supplies, remember to go for something that is of high-quality, easy to clean, and maintain so that you don’t end up spending on replacement costs every now and then.
  • Don’t splurge on limited edition cutlery: Although it is tempting to splurge on the limited-edition cutlery and other restaurant supplies by premium brands, it can make a huge dent to your overall restaurant budget. If the objective is to cut down the cost, it is essential to prioritize functionality and quality over other things.

2.     Hire the right set of people

Staff & employees are, undoubtedly, the largest expense for most businesses including the restaurant business. In order to cut costs, it is essential to retain the most qualified and competent employees long enough to capitalize on this up-front investment the restaurants make in hiring them. Remember that the longer the staff or employee stays with the restaurant, the less money they cost. The right combination of talent and experience in the employees working for you can make a great difference and help you cut cost in long-run.

3.     Save on the supplies

Other than using the energy-efficient and cost-saving restaurant supplies, another area where the restaurants can cut cost is on delivery supplies. In most of the restaurants, the delivery supplies eat up a large portion of the restaurant budget and disrupting the entire costing. Some of the ways the restaurants can cut cost on delivery supplies are-

  • By making systematic changes to the supply buying routine such changing the deliveries to a weekly mode instead of daily or if few vendors doing the different supplies can consolidate their operations, it will also help in cut down cost.
  • Streamlining the buying process and cut cost on overhead expenses such as transportation cost etc.
  • By making strategic decisions such as placing larger orders less frequently etc.

4.     Cut down on unnecessary ingredients

The general rule in the restaurant industry is that 20 percent of the overall menu represents 80 percent of the food budget. To effectively cut the costs, it is essential that restaurants make sure that the unnecessary ingredients and menu items aren’t eating the budget more than essential.

5.     Optimize the Inventory

The wastage of food is one of the leading costs in food businesses and restaurants. To cut down on this unnecessary expense, it is essential to optimize the inventory. Although in the food business, especially restaurants, there is a general perception that having an overstock of inventory is the sigh off preparedness, but it leads to a lot of wastage and food spoilage at the same time.

If you are looking to cut down the cost, start with optimizing your inventory. Not only it will save wastage but will also minimize the chances of theft, misplacement or wastage of the inventory.