In the dynamic and competitive landscape of Toronto’s restaurant industry, small eateries face a constant challenge: balancing quality service with financial sustainability. As operating costs rise and profit margins shrink, the ability to save money becomes paramount for the survival and success of these establishments.
In this article, we look at 8 ways specifically for small restaurants to effectively manage expenses without compromising on food quality or customer experience. From menu optimization and efficient purchasing practices to staff training and embracing technology, the following insights offer actionable steps to help small restaurant owners navigate the complexities of cost-saving in the culinary world.
1: Menu optimization:
For smaller restaurants, offering an exciting menu with plenty to choose from just isn’t budget friendly. Any menu needs to be regularly reviewed to identify items that aren’t performing well, or which contain ingredients that are becoming costly or being under-utilized. Adopting the habit of reviewing a menu can help small restaurants in both reducing food waste and lowering inventory costs.
2: Buying in bulk:
Instead of purchasing ingredients on a need to buy basis, why not consider bulk buying ingredients that are regularly used? Buying ingredients in bulk can often lead to significant cost savings for all sizes of restaurants, so don’t be afraid to negotiate with suppliers. It may also be a good idea to join purchasing cooperatives with other local businesses, as this can help your restaurant access better prices.
3: Minimizing food wastage:
Minimizing food waste is essential for all restaurant businesses. A restaurant’s POS (Point of Sale) system will help identify what menu items are selling or not and assist in you to be more accurate forecasting demand. Where there are leftover ingredients, be creative with daily specials that you offer. Don’t also forget to properly store all perishable items to avoid unnecessary waste.
4: Being energy efficient:
Where possible, invest in energy-efficient equipment and appliances for your premises to help reduce utility bills. Educate your staff to be more mindful in using equipment and turning it off when not in use. Perhaps having regular maintenance checks of your venue’s equipment and appliances can identify efficiency issues and help contribute to energy savings.
5: Training staff:
Everyone in your team has an important role in helping to keep costs down. Properly train staff to minimize errors in food preparation, portion control, and waste management. Making your team members more mindful about costs can lead to less food wastage and higher productivity.
6: Make use of technology:
Restaurant technology has come on leaps and bounds in making all aspects of daily operations much easier and more efficient. Investing in restaurant management software will help you streamline your activities, manage inventory more effectively, and track expenses. Additionally, why not consider utilizing online ordering systems and delivery apps? These can help expand your revenue stream without significant upfront costs.
7: DIY marketing:
Why outsource your marketing efforts and employ expensive marketing tactics to promote your restaurant? Social media platforms are probably the most effective and cost-efficient way for restaurant owners to reach and engage with their target audiences. Don’t forget that this is a ‘review world’, so encourage satisfied customers to leave reviews and spread the word through word-of-mouth.
8: Flexible staffing:
For smaller restaurants, utilizing a mix of full-time, part-time, and seasonal staff is the best way to meet demand fluctuations and keep labour costs down. Cross-training employees to handle multiple roles is great way to optimize staffing levels and avoid disturbance to your daily operations.
Take away thoughts…
Naturally every restaurant wants to offer the best it can to attract customers in and build its loyalty base. Being mindful of expenses and implementing some of these cost-saving measures above can help improve your bottom line whilst not having an impact on the quality food and service you provide to customers.
CHI is dedicated to keeping up with local and national trends in the Restaurant Industry to help serve our customers better and keep them one step ahead. If you are interested in opening, purchasing, or selling a restaurant CHI Real Estate can help. Get in touch with our team today.