Cutting costs when expenses continue to climb

While inflation is down across the U.S. economy, costs continue to be a strain for many foodservice operators. The National Restaurant Association’s most recent State of the Restaurant Industry report found that higher labor costs are an issue for 98 percent of operators and higher food costs are hurting 97 percent. The upcoming election has added a layer of uncertainty to the economic landscape. While operators may feel they are running as leanly as they can, there are likely areas to trim expenses. Consider whether you can take action in these parts of your business: Winnow down your supply chain, retaining relationships with longstanding suppliers where you may be able to negotiate better deals. Scrutinize your menu and limit it to your most-profitable, best-performing items. Measure, track and reduce your food waste. Use technology that gives you up-to-the-minute information about your business. Fast Casual reports that Sbarro uses real-time data to reduce errors, ensure their cost of goods sold is accurate, and pinpoint where problems with sales and products may exist across locations. Conduct an energy audit, use sensors and staff training to ensure less-essential appliances are turned off when not in use, and develop a longer-term plan for replacing/upgrading equipment that operates inefficiently. Maximize staff hours through cross-training and scheduling software to streamline labor. Finally, keep your books current to promptly identify issues. Restaurant Finance Monitor suggests some tips: Each day, record sales through your POS. Automate your accounts payable and payroll. Reconcile your accounts frequently – ideally daily through automated tools. Review your profit & loss statements and prime cost each day to ensure you’re making the right decisions about your staffing, menu and inventory.