The restaurant industry has many moving parts, it can be a bit daunting for first-time restaurant owners to understand all aspects of the business. In the process, they tend to overlook the smaller things. This results in pilferage, wastage and losses.
The restaurant business in Dubai is a game of pennies, each penny adds to or depletes the bottomline. This makes it so important that your business is ‘manageable’.
Each new restaurant tends to focus on increasing sales, but each restaurant will come to a point where controlling their costs will be imperative. This is usually experienced when a particular restaurant has reached its optimum capacity and the growth rates start to dwindle. In case you’re wondering where to begin with cost control, these smart tips below should help:
1) Streamline the Menu: Slimming down the menu of your restaurant can benefit your business by reducing the inventory. It could also mean less-fluctuating costs and elimination of everyday wastage. Another issue of having large inventory is the dead capital that could be creating returns elsewhere.
2) Substitute the Ingredients: A restaurant thrives on their chef’s ability to come up with innovative dishes. The same should be the case in your restaurant. Urge your chef to try low-costing alternatives in some of your dishes. It might save you a few bucks, and also let your chef explore his culinary expertise. However, ensure that substituting quality ingredients does not compromise on the integrity of your dishes.
3) Don’t Hire unless required: Employ staff at your restaurant, based on the size and scale of daily operations. Focus on the productivity of the human resources, which is equally as important as the food served at your restaurant. Time management and efficient resource allocation, once set into place, can make the operations of your restaurant much better. The key lies in setting the right processes in the right place, and efficiently training your staff to manage your customers’ needs.
4) Choose the right Supply chain partner: You can easily manage your business, by choosing the right supply chain partner. In today’s day and age, all suppliers offer credit facilities and rebates for providing regular sales volumes. Make sure you try to put as many things in one supplier’s basket, rather than having multiple suppliers for few things. This will allow you to generate volumes for your supplier and demand better pricing terms and rewards for your business.
5) Be Smart with Energy: The biggest culprit in any restaurant’s expense is the amount of electricity used for its functioning. A major chunk of this comes from the use of refrigeration, lighting and air-conditioning. Switch to energy-efficient appliances if you haven’t already done so. As for lighting, don’t spend too much money on brightening up areas which receive copious amounts of natural light. Keep the focus on reducing your carbon footprint and work towards creating a greener future, for generations to come.
If not immediately, controlling costs is bound to reduce the unnecessary expenditure of your restaurant, in the long run. It may reduce the burden of expenses slightly; though a good restaurant operator will continue to focus on maintaining, if not increasing sales, using the right tools and activations. Cost control coupled with other tools of restaurant management will be your best chance to success in this highly competitive market.
At Ribbon, we offer restaurant consulting and management services to help you create a unique and profitable restaurant businesses, anywhere in Dubai.