COVID-19 closures caused many businesses to struggle or even go under because they were no longer able to pay their rent or their employees. Because of this, many restaurants may look to their operating costs to ensure this doesn’t happen again. That means operating a smarter business and finding a way to cut costs. With a few easy tips and the Date Code Genie®, you will have a restaurant that is running more efficiently in no time.
Food waste can play a huge role in a restaurant’s dwindling profit margin. Throwing out food is the equivalent of throwing food in the trash bin. The Date Code Genie® can help you solve this problem with Product Control Tracking software. The add-on software allows you to analyze the ingredients you use most often and when. Be sure you’re ordering local ingredients whenever possible; it will help you cut costs and offering farm-to-table options will bring in more customers. You can also use the Date Code Genie® to print food safe labels to keep track of prep date and use-by date. This will help you use older products first so that they do not go to waste.
Revamp your Menu
Using Product Control Tracking software with your Date Code Genie® will not only help you determine what is going to waste or when stock is low and you need to re-order, but it will help give you an idea of what items may not be so popular on the menu. Focus on unpopular menu items. Are you forced to toss a lot of ingredients because no one is ordering the dish? You may need to remove it from the menu.
Determine Your Profit Margin
While you are determining which menu items are most popular and which are not selling, it is time to calculate food cost. To do this, subtract the cost of ingredients from how much the dish is sold for. This is your gross profit. Divide your gross profit by the price you sell the dish for to determine your gross profit margin. Your margin per item should be between 70-85%. If your profit margin is not that high, you may need to source more affordable ingredients or increase the menu prices.
High turnover rates can cut into profit margins. If you are hiring people that end up quitting shortly after starting, it is time to review your hiring process and how you select candidates. It may also be time to launch a rewards system program to encourage employees to do better and to increase retention. If you find that the restaurant is often overstaffed, take a look at how your restaurant handles reservations; you may need to find a more efficient process.