How to Reduce Food Costs and Boost Revenue

  • 18 Dec 2017

Owning a restaurant can be a successful and fulfilling venture. Knowing where and how to reduce food costs can boost your revenue and increase productivity.

You’re wasting too much food and it’s affecting your restaurant’s bottom line.

Food waste is a problem for restaurants: 84.3% of all food waste is disposed of, compared to just 15.7% that’s recycled or donated.

There are plenty of ways you can reduce food costs and waste for your restaurant. Doing so will improve your margins, help the environment, and boost your community.

Here are twelve easy ways to reduce restaurant food waste and boost revenue at the same time…

1. Conduct Regular Inventory Checks (and Cost It Out)

Regular assessments of your inventory will tell you several things. It’ll show you what you’re using most, and what you need to stop ordering altogether.

You will also be able to create a budget on a cost-per-diner basis, when you know how much food you serve on a daily basis versus the number of covers served. This will give you a good idea of current spend, and help you determine a lower cost-per-diner to achieve with your food waste reduction policies

2. Monitor Current Wastage to Reduce Food Costs

As part of your regular inventory checks, you should also keep a chart of waste.

Keep it in a handy place in the kitchen and train staff to use it immediately after a food waste incident. This will help you to keep an accurate record.

On the chart, make sure you have space for different types of food waste incident. These include spillages, burned food, returned portions, and incorrect orders. Doing this will help you to improve staff training to reduce food waste as you can easily identify areas for training.

3. Track Food Prices and Prepare for Increases

Keep track of food as it goes up in price out of season or due to climate or supplier problems.

If costs rocket, take it off the menu. If it’s a seasonal change, you will be able to factor this into your following year’s prices for a more stable year-round margin.  Keep track of your recipe costing with our Recipe Cost Calculator.

4. Don’t Overfill Plates

Check your portion sizes. Keep an eye on any dishes that frequently come back to the kitchen with plenty of food left on the plate.

This will tell you how much you should be serving and will slash your food costs as portion sizes decrease

5. Prep More to Save More

If you’re willing to put in some extra work you could reduce food costs by thousands every year – and minimize waste at the same time.

Instead of buying fillets of chicken, for example, ask suppliers for their bone-in option. Don’t pay for sliced or pre-peeled vegetables, spend time prepping whole ones instead.

Prepping food like this will allow you to maximize food use to reduce your food expenditure. Bones can be used to make stock, for example, which then reduces further your need to purchase ready-made stock too

6. Minimize Unnecessary Spend: Know Your Food Grades

Do you really need grade 1 food for every ingredient? Learn about the food grades available for your main ingredients and decide which ones you can afford to go lower on.

If a foodstuff isn’t going to be presented in its original form, for example, you don’t need to buy the perfect version. A grade 3 tomato will taste just as good smashed up in a sauce as a grade 1 – but it’ll save you thousands over the course of the year

7. Shop Around and Negotiate

Have you used the same suppliers for years? It’s time to talk to them and negotiate.

Work out how you can reduce food costs by negotiating with your regular suppliers. For example, if you pay for every delivery, see if they will offer a reduction in total delivery costs if you pay an up-front annual fee.

There are new suppliers arriving on the scene all the time, too. Keep an eye on them and get quotes when your contracts are coming up for renewal. Even if you want to stay with your supplier, having quotes from their competitor will help you to retain a good price for your food

8. Work Seasonally and Locally

Get to know suppliers local to you and you’ll be able to support your community as well as reduce delivery costs. Local business to business partnerships will also help your marketing opportunities as both businesses can promote your partnership to customers for free.

Seasonal produce will always be cheaper, too. Reduce food costs by continually renewing your menu as the seasons change. This will also have the added benefit of keeping your customers interested and returning for repeat visits as new dishes appear on the menu

9. Organise Your Kitchen

Operate a ‘first in, first out’ policy in your kitchen. Any produce that goes into your refrigerators must then be used in order of the oldest ingredient first.

This will help you to rotate your stock and maintain an efficient overview of your food use, as well as minimize waste by using up food with the shortest shelf life instead of throwing it away

10. Offer Daily Specials

When you find an abundance of a particular ingredient that simply must be eaten, create a daily special.

Running offers like this will reduce food wastage and also encourage customers to try out something new on the menu

11. Reduce Your Tax Bill by Donating Leftovers

Did you know that donating your food leftovers is tax deductible? You can offset the costs of food wastage by donating as much as you can to shelters and food drives.

Doing this will also boost your reputation in the community as a socially and environmentally-aware restaurant. This kind of reputation spreads like wildfire and encourages new customers to try out your restaurant!

12. Use Software to Improve Efficiency

There’s a real need for restaurant software to minimize wastage and reduce food costs. The multi-stranded efforts detailed above can be hard to keep track of, so it’s important to find software that can help.

You’ll need to find a restaurant app that serves all of your needs, such as supplier management, food waste monitoring, and easy reporting for simple restaurant management.

When you’ve got this in place, it’ll be much easier to track your successes when it comes to reducing food waste and improving your margins.

One More Step To Reducing Food Costs

Try out Kitchen Cut, an all-inclusive restaurant management app that will help you to reduce food costs, improve efficiency, and boost your margins! A 14-day trial is totally free – try Kitchen Cut out now.


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