Managing a restaurant business is a balancing act of keeping sales and profits high, while maintaining expenses at a minimum. With profit margins known to be notoriously low industry-wide, you have to be conscious about your actions, from hiring labor and choosing the right POS software to deciding on menu prices and purchasing food. Your time and money are precious — don’t let your resources go to waste. To start, here are a few pieces of advice in cutting food costs at your restaurant.
Calculate the cost per plate.
Make a list of all of the ingredients the restaurant has on hand and mark down the price of each one. (That means everything — even salt and pepper.) Determine the value of ingredients and overhead spent per dish, and set a selling market price based on the food-cost ratio you want. Make sure it is reasonable enough that you break even and is still fair for customers.
If you have a hard time coming up with a number that looks right, that’s a sign that you need to find less expensive alternatives. Do this on a weekly basis so that it becomes common practice. Keeping track of these expenditures will come in handy for future purchases. [Read more…]