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Top 10 Tips for Cutting Costs in Your Foodservice Operation

With the economy affecting all of us, ongoing cost control through careful spending is becoming priority #1. According to Jeff Breeden of Cook’s Direct, “Many of the restaurant owners and foodservice managers that we talk to everyday are telling us how the number crunching in the kitchen is now critical to controlling costs and staying afloat during these rough times.” Here are ten easy tips to help you cut costs in your kitchen.

Create a Sales Plan and Budget

For every business goal, you should have a plan. To effectively manage kitchen costs, you need a good plan in place that balances sales projections with expenses. Although going through this process is tedious, the outcome can save you hundreds, even thousands, of dollars. But to be effective, you must measure actual costs and revenues and compare these to your budget on a monthly basis. For every area that is over budget, it’s time to dig into the account and analyze why costs are too high. In some areas, costs may be under budget. Understanding why costs are under budget is as important as digging into those that are over budget.

Good fiscal management is the key to any successful business. A good business plan evaluates your expenses, sets a budget, and helps you to trim costs where necessary and most appropriate. It will also help you understand the mechanics of your business. Being in tune with each area of your operation will lead to great profitability.

Tip #1: Prepare a business plan with forecast and budget for food purchases, restaurant equipment and supplies, and repairs or services. Compare your actual expenses against your budget for each area on a monthly basis to identify overspending in any specific area before it becomes a serious problem.

Review Your Ingredients

When kitchen costs start to soar, it’s time to check out the ingredients being ordered by the chef. Trying to offer too many kinds of foods on a menu unnecessarily increases your food costs. You’ll find that keeping the ingredients on hand for a larger than necessary menu is expensive. It also makes it more difficult to use up certain food ingredients while they are still fresh, potentially causing an increase in food waste.

Tip #2: From Bob Agrast of Menorah Park Center for Senior Living in Beechwood, OH: “Track your food purchases by components. You purchase multiple categories of products from companies such as Sysco. If you track your purchases as we do, it is easy to dissect your spending and find cost trends. We track by splitting out the following minimum categories: Meat, poultry, seafood, produce, milk, pop, bakery, wine. Groceries are subdivided further to track nutritionals and thickened juices etc. You can track as many as you are able to do. Once separated it is easy to watch your purchases monthly to see if you are spending more in any particular category. If you are, you are then able to delve in to finding what may have caused the spike in purchases in the category. It may be justified, maybe not, but you at least know where to begin searching for food cost problems. The same technique can be performed with repairs and non-food expenses.”

Make Portion Control Your Priority

Small changes in portion size can create big payoffs or negative results to your bottom line. If your portions are too large, or even just more than your customers expect, you’re throwing money away.

To better understand the impact, consider this example. Your operation serves sandwiches with ¼ lb of deli meat and you serve 50 of these each day. Few people can tell the difference between 4 oz. (¼ lb) or 4-½ oz, so let’s imagine that your servers are measuring the meat, but aren’t focused on accuracy and tend to go heavy rather than light. If there’s an extra ½ oz. of meat on a sandwich, they probably can’t tell, but that ½ oz at 50 sandwiches a day ends up being almost 11 lbs of deli meat at the end of one week. That’s 568-¾ lbs by the end of the year. If you’re paying only $5 per pound for that meat, you’ve just given away $2,843.75, one sandwich at a time. Now think of that with more expensive ingredients or in bigger quantities! You get the idea.

Tip #3: The right portion control utensils can bring consistency to your kitchen and ensure that portion sizes are perfect. Proper portion control serving utensils and portion control scales can ensure consistent portions every time, even with a change in staff.

Review your Extras to See Where you Can Save

Atmosphere and extras are a great way to impress customers, but when money is tight it’s time

to cut back. Review the extras with staff that aren’t needed and that aren’t a part of your customer service. If it isn’t adding any customer value, then reducing usage or cutting it altogether can improve costs.

Tip #4: Document everything that is considered an extra from the garnish on the salad plates to the replacement kitchen supplies like covers on the trays during the holidays. Put a dollar figure on each extra and consider which options will create the biggest impact. Finally, call a meeting with staff members, especially those who interact with customers, and brainstorm for ideas to lessen costs but still maintain customer satisfaction.

Take a Look at Your Garbage

How much of your inventory is going to waste? Inventory orders should coincide with the seasonal traffic of your restaurant or operation. Make sure inventory is ordered with the least amount of overstock waste.

Tip #5: From Bob Agrast of Menorah Park Center for Senior Living in Beechwood, OH: “Work your boxes at least two times a day. Your boxes (walk ins) are the greatest collector of waste because unlike the storeroom, the items in your coolers have a short shelf life and the clock is ticking. It is not just about proper sanitation when you check your walk ins and other coolers. Check for overproduction. Decide how to reduce overproduction. What to do with leftovers? How can they be recycled or recondition? Leftover turkey becomes turkey chili. Left over baked fish can be turned into delicious fish cakes served with remoulade sauce. It should also be the policy that nothing is thrown out without the manager or chef’s approval. Leftover rice can become tomato rice soup, or turn it into spectacular rice pudding. Leftover product would then be compared to the production sheet records so that adjustments may be made the next time that menu is served.”

Avoid Over-Staffing in Your Kitchen

Just like the seasonality of your business should be reflected in your purchasing, make sure that you’re staffing appropriately for busy times as well as slower times of the day. Cross training of employees can also lead to improved productivity in your kitchen by having one person handle two roles during slower times.

Tip #6: When customer traffic is down, use all available staff to prepare foods in advance. You can have employees cook and freeze roasts, slice them and prep for barbecue at a later date or prepare and freeze batches of lasagna. All these things can be done well in advance so that you optimize labor.

Reduce Energy Consumption and Start Saving Money

Restaurants and other foodservice operations are one of the highest energy consumers, using roughly 2 ½ times more energy per square foot than used in other commercial buildings. Energy dollars are often wasted in the form of excess heat and noise generated by inefficient appliances, heating ventilation and air conditioning systems, lighting and refrigeration. Investments in ENERGY STAR equipment can help restaurant owners and foodservice managers improve the performance of their operation while reducing energy costs. Restaurants that invest strategically can cut utility costs 10 to 30 percent without sacrificing service, quality, style or comfort while making significant contributions to a cleaner environment. ENERGY STAR has a variety of certified equipment that saves utility dollars. Some of the equipment certified by ENERGY STAR includes fryers, hot food holding cabinets, commercial solid door refrigerators and freezers, and commercial steam cookers, commercial dishwashers, and commercial ice makers.

Tip #7: If you can’t replace your equipment today, you can still reduce your utility expenses by regularly cleaning and maintaining your existing equipment. Make it a habit to clean the coils on your refrigerator monthly or de-lime your steamer periodically. To learn more tips, take a look at Ten Tips to Save Money and Energy in Your Commercial Kitchen from Cook’s Direct.

Minimize Waste by Ensuring Food Stays at Proper Temperature

Maintaining your walk-ins and any warming and holding equipment ensures you aren’t wasting money on spoiled food. A good way to watch for inventory spoilage is to check food temperatures at least every two hours to make sure it never enters the food Danger Zone. For prepared foods, like soups and buffet items, check the internal temperate frequently to ensure it maintains a minimum of 140o Fahrenheit.

Tip #8: Have your equipment serviced regularly to make sure it’s calibrated and running at peak efficiency.

Save on Utility Bills through Reduced Water Usage

Reducing your water usage doesn’t just save you money in the water bill. It saves you money in your electric, gas, and sewer bills as well. Utility companies read your water meter to calculate your monthly sewer bill. They estimate that most of your water goes down the drain, so reducing water usage also saves on sewer costs.

Regardless if your water heater runs on gas or electric, reducing the water usage will reduce the amount of money needed to keep that water heated. Using energy efficient products like a steamer or dishwasher will increase the savings even further. They use less of both water and electricity than their standard counterparts, so when you buy an ENERGY STAR qualifying dishwasher, you are reducing your water and electricity bills.

Tip #9: Replace older faucets with newly developed models that conserve water without compromising performance. You can find a list of endorsed products on the official Green Restaurant Association web site.

Work with your Suppliers

Whether it is seasonal produce from local growers or clearance products from your equipment and restaurant supply vendor, let your suppliers work for you. By developing relationships with your suppliers, you can often have them do the leg work for you to get what you need at the best value. As you develop a relationship, a good supplier will get to know your business and your needs. They can advise you on upcoming opportunities for you to save money through smart planning and buying.

Tip #10: Use the internet to do some quick and easy price research to ensure you’re suppliers are working for you. Websites like Nexttag.com or Shopzilla.com can help you compare market prices so you feel confident when negotiating with your suppliers.

About Jeff Breeden and Cook’s Direct:

Jeff Breeden is active in the Foodservice Industry through his work at Cook’s and as a member of NAFED (National Association of Food Equipment Dealers). During the past 12 years, he has held a variety of roles including new product development, national account sales, and brand development. In his current responsibility as Chief Merchant, he utilizes his experience and expertise to find innovative equipment and supply solutions to meet the evolving needs of restaurant and institutional foodservice operations. Cook’s Direct provides a full range of commercial kitchen solutions including all types of kitchen supplies and heavy duty restaurant equipment to correctional facilities, institutions and other large foodservice operations across North America. The company was founded over 10 years ago and is known for its innovative products, strong customer service and expert knowledge of institutional kitchen operations.

Inquiries can be sent to:

Jeff Breeden, Chief Merchant

Cook’s Direct

800-956-5571

http://www.cooksdirect.com/

About the Author

Cooks Direct

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