i am a restauranter, how can decrese my food cost or make good profit.?

Question

my rate are very cheaper, and i am newly for restaurent, i like to know,how i can increse my business.

Answer 1

Decrease your food costs one of the following ways...

1. Take a weekly inventory- see how much you are over ordering and what you are wasting...Do a P&L every week comparing your cost of goods sold to your food cost- this will give you a good idea of what your food cost is and a base of where to start cutting.

2. Create a daily waste log -to see how much food is getting thrown out from overprepping at the end of the night

3. MOST IMPORTANT- WATCH YOUR STAFF!!! Are they using proper specs? are they stealing food (either eating on shift or walking out the back door)

4. Create goals for your BOH- tell them if we hit 35% food cost this month, I'll give you "this" ( a reward of some sort you figure out what)- the next month tell them if you get 33% I'll give you this..(another incentive)

5. Hold your Kitchen accountable- You run them- do not let them run you

Increasing your profit.....

1. A very clean restaurant

2. Outstanding quality of food

3. Great, friendly and accomidating staff

4. Proactive Manager/Owner- greeting tables know your clientelle

I purposely put them in that order because that is the order of success- food can be great but does it matter if your restaurant looks like crap? Can have a great staff but if food sucks does it matter how good they are? Can have a great manager/owner but if you have a dirty restaurant crappy food and a bad staff does that matter?

What I have done for my restaurant is the offer a buy 1 entree get 1 free special during the offseason-
or...

Open up to catering or business office deliveries depending on what food you serve- Party platters are always a good move.

Early bird specials between 4-6pm M-F- Take $2 off each entree (on a seperate menu of course) or offer early bird to include Drink, salad and entree for 1 price.

Answer 2

Hi,

There are several questions here all rolled together. I will address them individually.

Decreasing Food Costs:
The first item for this is to limit the number of options to lower waste. A restaraunt which offers 200 items will have substantially more spoilage than one which offers only 100. In fact, I frequent several restarants which offer less than 50. Each item is very good, and the prices are reasonable.

The second idea is to lower the quality of the food. Let's assume that you are a basic, steak house. You would not want to lower the quality of your steak; however, a slightly cheaper, potato, french fries or bread could make a huge difference since each customer is served this item. Since they are not the center of the meal, people are also less likely to discuss them. The perfect real world example of this is Dairy Queens blizzards. Many DQ owners substitute offbrand candies for their blizards, like Hydrox for oreos. As a consumer, you don't really notice, but they are considerably cheaper for the owner.

Increasing Business.
I assume your request to increase your business, is a way of saying you want to increase the cash your business produces.

Let's look at this from a high level:

Profit = Income - Expenses

In order to maximize Porfits, you will need to increase Income aka revenue or decrease expenses. In addition to food expense, there are probably other expenses to lower. You should look at each expense (phone, rent, utilities, utensils, cleaning supplies, uniforms, advertising) and ask if you can lower the price. Every single dollar that you don't spend on expenses will be another dollar for you in profits.

On the other side, increasing revenue will also build your profits. I assume you rent will be the same whether you server 10, 100, or 1000 meals per month. Rent is an example of a fixed cost and serving more meals means rent with have a correspondingly smaller impact on your bottom line.

This means that you should look to increase customers, but remember advertising is an additional costs. Many people blindly start advertising, and then create a huge problem when more people come; however, they still aren't profitable because they still have all their original expenses, and now spending on advertising as well.

The third thing to consier is "my rate are very cheap"? Why is this? Consider the following example:

- Total Cost to you to make a hamburger: = $1.00
- Option 1: Sell hamburger for $1.25
- Option 2: Sell hamburger for $1.50


Regardless of the sales price, the hamburger costs you $1 to make. It doesn't know how much the consumer is paying for it. However, consider you are looking to earn a $10 profit from hamburgers. In option 1, you would need to sell 40 hamburgers. In option 2, you only need to sell 20 hamburgers to earn the exact profit to you.

Unless you have a substantial reason for being the overly cheap, don't be. This is one of the biggest common mistakes among new business owners. They think that just being cheap is a way to earn money, but it is not. You need offer fair prices and give good value to the consumer, but there is no need to be "cheap". You should drive around to the close restaruants to ensure your prices are similar to theirs, but beat them on quality or friendliness.

Cheers,

Leo

Answer 3

The best way to increase your business is to provide outstanding service. Word of Mouth is a better advertisement than ANY OTHER METHOD. I suggest that you give your regular customers a discount coupon that they can use ONE TIME when they bring a friend. Lots of restaurants do this and it does indeed attract a larger customer base. As far as food cost goes, you must keep your employees under constant surveilance. Stealing is the primary cause of high food cost. Most waiters/waitresses purpose do not charge for all items so that they can get a bigger tip. (Most people do NOT tip based on a % of the total bill anymore.) Also, you need to make certain that all of your employees are thoroughally and properly trained. Poor training is the second largest cause of high food cost.

Answer 4

for one, concentrate on quality and service.
second, and perhaps even more vital; is to attract customers.
do you have businesses with lots of employees nearby?
for your grand opening, use coupons; give a discount to get those employees in your restaurant. make it 30%-50% off a dish or something similar.
yes, you may lose money at first. but, if they like your restaurant, they will come back, and maybe even bring friends. word of mouth advertising by friends is not only free but it will convince someone else to try your place out
if you have good food, good service, and a good atmosphere,they will be back and be paying the full prices for your dishes
good luck!

Answer 5

Your food cost, starting out can be 40% of your sales, but as you move forward in time, you are going to need to increase your sales so that your food cost is 30% or lower (if it is too low, your customers are being ripped off and they know it and it will cause problems with your reputation). If you are dealing with labor issues as well, that should be MAX 19% of your sales, if you also do run the store, if you have another manager, total labor should be about 25%.
Keeping inventory is wasted money. Get only what you need and move it through your store in the form of sales. (by the way, paper goods counts in food cost, but safety materials such as soaps and santizers do not count as these are musts in food service).

Answer 6

Keep it simple, you need to increase your Return on Investment rather than decrease food cost (which may compromise quality). My advice is you should go for Internet marketing. make a website, get your customers emails (for email marketing). At the beginning you can spend only 10% of your revenue and you will be surprised by the amount of new customers. My advice is to go for a local Internet marketing consultant and let him tailor make a solution for you. Try www.wsimarketing.com

Answer 7

It all depends on the segment you serve. Anyways, here we go.
I assume the income level in your locality is of upper middle class, who eat out for taste and fun, not for hunger.

The business you are in is service and its measured by satisfaction. Satisfaction is a sensory perception of individuals (tastes) and people become addicted to your products and they never mind spending.

Now here are my tips.
1. Never mind the cost. You always have profit.
2. Concentrate on quality (taste) of food
3. Restrict your menu to a reasonable number so that you can concentrate and
4. in the due course, specialise in few items - that your name is spoken after

Answer 8

ADVERTISE: DIVERSIFY and cut your costs to the bare minimum. you want to fill your tables, you have to tell people whats happening at your restaurant...by flyer, by small cost effective adverts in free papers.. flyer the local university, STUDENT NIGHT... how about finidng out if theres and call for catering at wedding and funerals..(weve all got to eat) and the list is almost endless, limited by your imagination...which is why restaauranteers employ freelancers, buddiing students at art college, PC whizz kids, (at junior school) and get them to make you a web page, and a flyer advertising your wares, and your highly competitive prices, especially for sstudents who eat between 3pm and 7pm monday tuesday and wednesday.. it fills your empty tables,a dn theyll be back for their 10% off weekend binge...

yes, i am cynical, but ive done this all my working life. its easy with a PC at home and Word, or publisher... anyone can do it...its being original and different which catches peoples attention and gets them in the door... think about it.

Answer 9

What matters in food business is the quality,hygiene and taste.If your food is really great then focus on niche clients alone who don't care about the price.If cost is the primary factor then McDonalds and KFC would not exist today.

Answer 10

ADVERTISE COUPONS , BUY BETTER FROM YOUR PURVEYORS, WATCH WASTE , CUT DOWN ON EMPLOYEE THEFT , KEEP THE BACK DOOR LOCKED , USE SEE THROUGH TRASH BAGS SO THE HELP CAN NOT THROW STUFF IN AND COME GET IT AFTER WORK, SET YOUR HEAT DOWN IN THE WINTER AND YOUR AIR UP IN THE SUMMER , AND THE LAST BUT NOT HIGHLY RECOMMENDED IS USE CHEAPER CUTS OF MEATS AND BUY YOUR PRODUCE YOURSELF AT THE LOCAL WHOLESALE MARKET .