10 Simple Ways to Increase Profit in your Restaurant
Optimize Menu Pricing
Analyze your menu items to ensure they’re priced appropriately. Consider factors like food cost, preparation time, and popularity. Sometimes, a small increase in price and/or a thoughtful reduction in size can significantly impact profits without deterring customers. Use our Menu Cost Calculator found on our website https://profitfirst4restaurants.com/tools/.
Reduce Food Waste
Implement strict inventory management and monitor food usage closely. Using inventory management software can help track and minimize waste, saving money in the long run. Or create your own Inventory Spreadsheet, it’s not rocket science, it can be as simple as columns for vendor name, unit of measure, price per unit, and number of units, and make sure you assign someone on your team to update the inventory on a daily or weekly basis to keep you on top of what’s happening with your food inventory. Also, keep in mind that all inventory represents “stacks of money on your shelves” and the only way to “unlock” those stacks of cash is to sell the inventory.
Streamline Operations
Evaluate your operational processes for efficiency. This includes kitchen layout, staff scheduling, and the use of technology for order processing, reservations, FAQs, you name it. Efficient operations can reduce labor costs, operating costs, and improve customer service.
Leverage Local Suppliers
Build relationships with local suppliers for fresher ingredients, potentially at a lower cost. This can also be a selling point for customers who appreciate local sourcing. The 80/20 Rule may apply here as well.
Offer Special Promotions
Attract more customers with happy hours, birthday or anniversary celebrations, special event nights, or loyalty programs. These can increase foot traffic during slow periods and encourage repeat business.
Maximize Table Turnover
Train staff to balance attentive service with efficiency to increase the number of guests served each night. Implementing a reservation system can also help manage peak times more effectively.
Expand Revenue Streams
Consider adding catering services, selling merchandise, or offering cooking classes. These can attract a new customer base and provide additional income sources.
Optimize Labor Costs
Use labor management software to schedule staff more effectively, ensuring you’re not overstaffed during slow periods or understaffed during busy times. While some may argue that staff scheduling is a science, some say an art form, either way, it’s extremely important and if done well, can save you time and money. While we offer a simplified solution in our Profit First for Restaurants Workbook, we also hear the rumblings of some AI supported scheduling software as well.
Embrace Digital Marketing
Use social media and email marketing to reach out to new customers and keep regulars informed about promotions and events. A strong online presence can significantly boost your visibility.
Monitor Financial Health Regularly
Use accounting software to keep a close eye on your finances. Regularly review your profit and loss statements to identify areas for cost-cutting and to track the effectiveness of your profitability strategies.
BONUS: IMPLEMENT PROFIT FIRST FOR RESTAURANTS to manage your cash and ensure permanent profitability!
Hi I’m reading your book and I really think this is going to help me actually run my business vs my business running me. We are a street cart vendor in San Antonio Texas that specializes in tacos nachos and quesadillas. It’s just me and my wife for 17 months now. My issue is this, however great your methods sound in theory, I don’t know if I can actually put it into existence. I think it’s overwhelming for me and j don’t know where to start. We are operating out of one big platter and I don’t know exactly where to begin. In your book you said to message you, and that you’d message back. It’s a good book and I’m learning a lot. But I sure could use some help. I’d really appreciate it, although I’m sure you’re busy. I guess what would be fun for you to know is that our initial start up cost were minimal, under 12k. And we made that back within our first month. Because we were forced to Change locations, we experienced some set backs but right now things are looking up because we secured a location in the patio of Coyote Ugly Saloon, which over looks the San Antonio riverwalk. It’s absolutely gorgeous. The trouble is that we are a little hard to find. But over the past month I purchased a few sandwich boards, through some led lights on them with a funny theme… where it says “Tacos” and points left, or “No Tacos” and points right. Simple, but funny and we’ve seen a 50% increase in foot traffic. I’d love to tell you more about it, I hope to hear back from you thanks for everything so far!