Running a restaurant is stressful. It is also easy to lose money if you are not managing everything correctly and orderly. In order to ensure that you stay open and you are financially sound in order to make a profit, here are a few ways you can effectively manage your restaurant’s costs.
Stick to Your Budget
Make a budget. It’s the smartest thing you can do. For a restaurant, there should be two budgets. One budget should be for the front of the house that covers things like office supplies, register paper, liquor, table supplies, and things like condiments. Basically, this budget is for anything the servers and managers need and use. The second budget should be for the back of the house, which is everything food-related and kitchen supplies. If you can manage to set up those budgets and stick to them, you will always know where your money is going and how much of it is going where.
Keep Your Overhead Low
Restaurants are an easy place to keep overhead low while having high prices for products. A lot of food, when bought at cost, is relatively low. With a great chef, they can take that product and turn it into something that is outrageously delicious and sell it for a high price. There can be a lot of profit made in this department. Also, there is little overhead when it comes to labor costs. Since many servers and bartenders work for tips, all the restaurant has to cover is a minimum wage. That is far less expensive than for restaurants that pay their servers and bartenders a daily rate or a salary.
Get a Restaurant Accountant
There are accounting firms that specialize in restaurants. Restaurant accountants will help you set up that budget, help you stick to it, and will also help you with keeping that overhead low. They will also help you manage labor costs so that you can allow enough people to work while everyone is still making money. When restaurants first open, there is an overabundance of staff, but after a while, you will be able to work with fewer people, and your accountant will be watching the numbers to let you know when that happens. Having another set of eyes is important.
Don’t Be Wasteful
Waste is the number one restaurant, budget killer. If you keep buying the same thing over again, you may be wasting it. Things like silverware getting thrown away, ketchup not being fully empty when it is tossed, and using register paper for taking orders are all waste. All of these things can also be very expensive. The same goes for the kitchen if ramekins or plates or cups are constantly getting dropped or broken or damaged in the dishwasher. Be careful with all of your goods and make sure you are getting full use out of all of them. It’s expensive to replace appliances. Take care of your space, and you will spend less money fixing things.