Ways to Cut Costs at Your Restaurant

Every business is always looking for ways to cut costs, and restaurants are no different. However, how you cut costs is important. You don't want customers getting angry because the food is of lesser quality or you have fewer wait staff, and you don't want your employees to get mad by cutting salaries or firing people. Below, we will explore some more positive alternatives that will allow your restaurant to cut costs without sacrificing your image.

Avoid These Cost-Cutting Measures

Let's start by going over what cost-cutting measures your restaurant should avoid taking.

• Don't dock employee pay. Your best employees will leave for other jobs.
• Don't reduce the quality of your food. Your customers will notice and you will likely lose business.
• Don't fire or lay off employees unless that employee is truly underperforming or the restaurant is in such dire financial straits that you have no other choice.
• Don't close too early.

With those points in mind, here are the better cost-cutting alternatives.

Remodel/Replace Fixtures for Energy Efficiency

This is a pretty innocuous change that can save your restaurant a lot of money over time, even if the upfront investment is a little hefty. The easiest and most obvious example is to switch out current lighting for more energy efficient alternatives. Use appliance models, such as refrigerators and ovens that use less energy. Also, ensure employees know to keep lights and equipment turned off when not in use and reward employees who do a good job conserving energy. Many restaurants are often kept too cold, so you might consider raising the temperature a little bit. You can use humidifiers and dehumidifiers to keep things comfortable in lieu of an HVAC system as well.

Buy Equipment from an Alternative Source

You can cut costs significantly at a restaurant by simply looking at where you can buy equipment and supplies for a cheaper price. This can apply to restaurant equipment parts as well, such as replacement parts for a stove. Online or wholesale stores are usually more cost effective. Sometimes it will just take some shopping around until you find the best prices. Do remember that buying things from multiple places is not always more cost effective because of factors like delivery costs. Used equipment, especially the large, industrial furnishings of a kitchen, can also be significantly cheaper, and there's usually no reason to buy new when you can buy used.

Reduce the Number of Items on the Menu

While this may upset some customers when they discover their favorites are no longer on the menu, it may be the better option to cut down on less popular menu items. This can save a significant amount of money in ingredients and supplies. It can even help turn table over faster because customers won't have as many choices to wade through and servers won't have to wait for a table to be ready with its order as often.

Don't Replace Existing Staff

Sometimes you do legitimately need to cut down on staff, particularly if you can get by with fewer employees without overloading them. The solution is to not replace an employee when he or she leaves. Employees in the restaurant industry typically have high turnover rates anyway, so unless your restaurant is the very high end it should not take very long for this to happen. Another option is to fix to schedule so there is never more staff present than is needed at slow times.

Have More Reasonable Portion Sizes

There are two options of going about this. The first is simply to ensure employees don't put extra food on plates, as it adds up over time and can result in more wasted food. The second is to reduce portion sizes altogether, at least on some of your menu items. Suddenly changing to smaller portion sizes across the board will make customers feel you're cheapening up, but you can market this effectively by touting the smaller portion options on your menu as a healthier alternative (which they are).

Cutting costs doesn't have to be as painful as it sounds. There are some creative and highly effective ways to save money while operating a restaurant that won't land you in hot water with either customers or your employees. Hopefully, the suggestions mentioned above have given you some good ideas for how to cut costs in your own restaurant without upsetting too many people.