In this post we take a look at five key areas of a restaurant business and give you tips on how to increase revenue and cut costs to boost your restaurants profitability.
1. Staff
To boost your restaurants profitability you need to work closely with staff. The first thing you should do is define your role as owner. What will your day-to-day responsibilities be? By having a clearly defined role then your are in a position to empower staff with the tasks that you won't take on. Empowered staff will be more motivated and loyal.
Another way you can motivate and maintain loyal staff is through training. A lot of hospitality owners baulk at the cost of developing their staff only to see them leave. What happens though if you train staff and they stay?
These two tips can save a restaurant thousands of dollars a year by reducing staff turnover. The time and money you save hiring new staff can boost your bottom line.
Another way to reduce staff turnover is to hire staff based on their attitude and motivation to do the job. This should be a key selection criteria. Potential employees who have the right attitude: a customer focus, adaptable and loyal are more likely to stick around.
One thing your business could consider doing to increase revenue and cut costs is to implement a monthly meeting of staff to discuss business improvement ideas. For example "What initiatives can we implement to boost the number of guests over the long weekend?" You will find that staff have some great ideas that you can implement.
Another way you can motivate and maintain loyal staff is through training. A lot of hospitality owners baulk at the cost of developing their staff only to see them leave. What happens though if you train staff and they stay?
These two tips can save a restaurant thousands of dollars a year by reducing staff turnover. The time and money you save hiring new staff can boost your bottom line.
Another way to reduce staff turnover is to hire staff based on their attitude and motivation to do the job. This should be a key selection criteria. Potential employees who have the right attitude: a customer focus, adaptable and loyal are more likely to stick around.
One thing your business could consider doing to increase revenue and cut costs is to implement a monthly meeting of staff to discuss business improvement ideas. For example "What initiatives can we implement to boost the number of guests over the long weekend?" You will find that staff have some great ideas that you can implement.
2. Customers
When it comes to boosting your restaurants profitability it pays to know what your customer are thinking. Pay attention to current dining trends and adapt your menu in response. Social media and review sites can provide valuable insight. Making changes based on customer feedback is critical to attracting and retaining customers. Social media can also be an inexpensive marketing tool to promote your business.
3. Food
When it comes to food you should spend your money wisely. One way to lower your food costs is to only use fruits and vegetables that are in season. Not only are you buying fruits that costs less but it can also be used as a selling point to market your business.
Food wastage is a big challenge for restaurants. By regularly tracking sales of your menu items you can trim that aren't selling well and cut down on food spoilage. A hospitality POS system will help you gather that data.
Another tip is to consider group buying. While you may only save 2-3% on some items, the savings can add up. Especially in an industry with low margins. A word of caution though, chefs can feel compromised if they are forced to buy certain ingredients. A voluntary system can work well.
Food wastage is a big challenge for restaurants. By regularly tracking sales of your menu items you can trim that aren't selling well and cut down on food spoilage. A hospitality POS system will help you gather that data.
Another tip is to consider group buying. While you may only save 2-3% on some items, the savings can add up. Especially in an industry with low margins. A word of caution though, chefs can feel compromised if they are forced to buy certain ingredients. A voluntary system can work well.
4. Equipment
Investing in assets that are user friendly, efficient and well maintained can save your business money. Equipment should be safe to use and fully operational. When things like fridges have cracked seals or a mixing appliance is missing a part then they cost more to run and you lower productivity. Now might be the right time to think of investing in assets for your business given the small business tax incentives announced in the 2015 budget.
5. Environment
Thinking about your restaurants impact on the environment can be a win-win when it comes to boosting your restaurant profitability. It can often save money and is great tool to market yourself to customers. Consider implementing the following:
- Install sensors for lights in areas that are only used intermittently
- Use timers to shut down equipment like warmers and ovens
- Install energy efficient light globes and water saving devices
- Use natural gas on stove tops
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