{"id":25657,"date":"2021-06-01T08:05:47","date_gmt":"2021-06-01T08:05:47","guid":{"rendered":"https:\/\/www.posist.com\/restaurant-times\/?p=25657"},"modified":"2023-08-29T14:18:36","modified_gmt":"2023-08-29T08:48:36","slug":"tips-for-restaurant-cost-control-post-covid19","status":"publish","type":"post","link":"https:\/\/www.posist.com\/restaurant-times\/uae\/tips-for-restaurant-cost-control-post-covid19.html","title":{"rendered":"8 Restaurant Cost Control Strategies Post-Pandemic"},"content":{"rendered":"

Restaurant cost control is an important concern and has become all the more important in the COVID-19 scenario. Effective cost control helps restaurants manage their finances and get better returns on investment (ROI) in the long run. Every business needs sufficient working capital to survive when there’s a fall in sales as was the case in March last year when the government announced a nationwide lockdown. Good financial strategies are required for businesses to survive lean periods and recover faster in due course.\u00a0<\/span><\/p>\n

The UAE is one of the most expensive countries in the Middle East region.<\/span><\/a> The high start-up and operating costs of the country’s restaurants make it necessary for their owners to keep a close watch on ROI. Furthermore, despite attracting plenty of tourists and having good infrastructure, the country has scarce skilled labor, which fuels high labor costs. Mismanagement of these costs can potentially bring the business down. Thus, restaurant cost control should be paramount for UAE restaurateurs.\u00a0<\/span><\/p>\n

Top Ways For Restaurant Cost Control Post-pandemic<\/b><\/h2>\n

Restaurant cost control has to be done strategically such that the quality of the products and services does not deteriorate. Here are some ways restaurant costs can be controlled in the backdrop of the pandemic.\u00a0<\/span><\/p>\n

1. Create A Budget<\/b><\/h3>\n

As generic as it sounds, the restaurant owners who fail to create a proper budget for their restaurant, often incur losses. <\/span>You should have an idea of the costs incurred in operating the restaurant, sales revenue, and your desired profit margin. <\/b>Build a budget according to these factors and use it to set limits on how much you spend on any unexpected expenses. Necessary changes can be made in the budget from time to time but adhering to it is always essential.<\/span><\/p>\n

2. Manage Your Menu<\/b><\/h3>\n

Managing the menu efficiently helps control the restaurant cost. It is crucial to monitor all activities that go into food production including sourcing, use of ingredients based on recipe and pricing. A purchasing team can be involved in managing the menu to analyze the cost of the ingredients and the final recipe before being included in the menu, and decide <\/span>when is the time to upgrade the menu<\/span><\/a>. This way, you can decide to include the profitable dishes and eliminate the ones that are not, thereby optimizing the menu.\u00a0<\/span><\/p>\n

If you are a restaurant owner who is planning to change to a different operating model, for instance, dine-in to cloud kitchen, you need to analyze the costs incurred in both and then optimize your menu. In this case, the menu should be delivery-focused and contain dishes whose quality does not deteriorate with time. This method ensures that the menu is getting your profits up to its full potential.\u00a0<\/span><\/p>\n

Furthermore, including seasonal dishes in your menu is a good choice. This can not only reduce inventory costs but also attracts customers.\u00a0<\/span><\/p>\n

\"Menu
Source: Upserve<\/figcaption><\/figure>\n

3. Track Food Wastage<\/b><\/h3>\n

There is a lot of waste generated from restaurants on a daily basis. As per Dubai Carbon, around <\/span>38 percent of the meals prepared are wasted on a daily basis in the UAE restaurant industry.<\/span><\/a> The number goes up to 60 percent during Ramadan. This excessive food waste demands good waste management.\u00a0<\/span><\/p>\n

Instead of bulk production, production should be carried out in smaller batches. Daily order values should be reviewed and revised to prepare an estimate of the expected orders for the next day or week. Everything that can be reused should be reused. The expiry dates of the products can be used to utilize the old ingredients first before they expire.\u00a0<\/span><\/p>\n

4. Introduce POS Technology<\/b><\/h3>\n

Restaurant technology has been evolving over the years. However, the pandemic has nudged the restaurateurs to embrace technology to streamline orders and increase sales, improving efficiency and revenues. The introduction of technology in your restaurant operations will only take your business one step further in terms of restaurant cost control.<\/span><\/p>\n

Deploying <\/span>good POS software<\/span><\/a> in your restaurant is a one-time investment, but it will earn you good profits in the long run. Online reservation, online ordering, inventory management, customer relationship management, online payment, billing, and splitting are a few of the ample benefits that POS software provides. Incorporating the right technology into your restaurant can streamline every operation while keeping track of your finances.\u00a0<\/span><\/p>\n

5. Reduce The Prime Cost<\/b><\/h3>\n

Prime cost or direct cost of a business refers to the cost of labor and raw materials. These are the controllable costs that just need good management. Following are the ways to optimize labor and raw materials costs.<\/span><\/p>\n