It goes without saying that running a business comes with challenges, especially in the restaurant industry. While owners are navigating a whole host of hurdles, one factor in particular has become noticeably prominent – rising operational costs.
With that in mind, as Canadian restaurant owners face evolving economic conditions, many are employing new and creative strategies to cut back on operating costs and improve margins. In this blog, we’re passing on a few of those methods to you.
Foundations For a Successful Restaurant
Let’s rewind. Whether you’re thinking about opening a restaurant or are an existing owner, understand that operating a financially prosperous business requires the right setup. In other words, keeping operating expenses low (and profits high) starts with a well-planned purchase and/or launch.
From drafting a business plan to securing the necessary funds and logistical support, there are many steps involved in getting your restaurant up and running. That said, no aspect of your venture will be as important as the business broker or restaurant real estate agent you partner with.
Beyond guiding you through the formalities of acquiring a restaurant space or active business, an experienced, knowledgeable team (like us!) can help you find strategic opportunities that are primed for success.
Want to know more about working with a commercial agent? Explore these related readings from our blog!
- Working With a Business Broker: The Basics
- Why You Should Sell Your Restaurant With a Business Broker
- What’s the Difference Between Residential and Commercial Real Estate Transactions?
Standardize Food Preparation
There’s nothing wrong with creative freedom in the kitchen. However, if you’re serious about cutting back on costs, you need to establish some standardizations.
Right off the bat, you’ll want to have a definitive recipe for every item on your menu. This goes for beverages, too. Ensure your kitchen staff have the necessary equipment to measure portions and prepare dishes as true to the recipe as possible.
Being regimented or systematic may not be the most fun way to cook, but it will protect your profits. It also ensures you’re providing a consistent culinary experience for your customers, which can generate brand loyalty in the long run.
Carve Up Utility Usage
As a restaurant owner, you already know just how quickly utility bills can add up. So, the more you’re able to cut back on your energy and water usage, the more profit you’ll have at the end of the day. This may seem like a tall task, but even small changes can have a big impact.
For instance, investing in energy-efficient kitchen appliances like dishwashers, fridges, freezers, or fryers can amount to hundreds of dollars (or more) in annual savings. Upgrading outdated light fixtures to modern LEDs will also dial back your energy consumption.
Invest in Your Team
Over the past few years, labour shortages have been a hot-button topic within the restaurant scene. Factors such as a smaller talent pool, employee burnout, and inflation-induced wage competition are making it harder to hire and retain team members. Adding fuel to this fire is burnout
Not only are staffing challenges a major headache, but they can be costly, too. From the costs and time required to hire and train new employees, staff turnover can be expensive. With that in mind, investing in your team’s growth and satisfaction can be a helpful way to reduce costs in the long term.
Thinking about starting your own restaurant business? Explore these related blogs for more advice!
- What Permits Are Needed to Open a Restaurant in Ontario?
- How Much Do You Have to Put Down on a Business Loan?
- Ready to Open Your First Restaurant? Here’s Where to Start
Embrace New Technology
There’s a lot to be said about doing things the old-fashioned way. However, when it comes to cutting back costs, embracing new technologies can be a big step forward.
For example, if you update your menu often, switching to a QR code-launched digital display can be a simple yet effective way to cut back on printing costs. Similarly, connecting your POS to an electronic kitchen display system (KDS) can speed up operations and help you avoid costly mistakes.
There is also a wide range of specialty software programs specifically designed to help restaurants improve efficiency and reduce costs. When integrated, these tools can help you manage orders and inventory, schedule staff members, forecast industry trends, and more.
Look to Labour Reducing Tools
When it comes to utilizing labour-reducing technologies to optimize your margins, the old “two birds with one stone” adage applies. Not only can these tools potentially reduce the number of staff members needed on a particular day, but they can also reduce the workload for those who are working, limiting the risk of burnout and eventual turnover.
Self-serve kiosks are one fairly popular example of labour-reducing technology in Ontario. Customers can place their orders easily and independently, creating a more efficient process.
Starting a Restaurant?
When it comes to burying or starting a restaurant, there’s no substitute for professional support from an industry expert. That’s where we come in.
As restaurant real estate agents, we know the unique ins and outs of restaurant real estate. Not only can we help you find the perfect spot to bring your dreams to fruition, but we’ll also serve as your long-term advisor on all things restaurant-related.
Ready to bring your goals to life? Carve Real Estate can help! Reach us at ryan@carverealestate.com or call 416-618-0054.
