Running your own restaurant is a challenging, exhilarating, breathtaking experience. You’re always trying to find new ways to wow your customers and keep your menu fresh. But sometimes, you just don’t see the profits you need to.
If your restaurant profit margin has been a little lower than you like recently, don’t lose hope. Read on to discover some tried-and-true tips for increasing your profits and keeping things in the black.
Check Your Prices
One of the first things you should do when you’re trying to improve your restaurant’s profit margin is to check your prices. Getting the right pricing is a delicate balance of charging enough to make a profit, but not so much that it scares customers off. Either of these things can cause you to see low-profit margins.
According to the website Restohub, you want to aim for food costs to be about 33 per cent of your menu price. But keep in mind the location of your restaurant, too. If you’re in a lower economic area of town, you may need to consider selling lower-cost food to match the prices of your surrounding competitors and vice versa.
Revamp Your Recipes
If you’re confident your menu pricing is as optimized as it can be, take a look at the recipes you’re using. We know no one likes to hear it, but it’s possible customers don’t enjoy your food. If you want to run a successful restaurant, run some market surveys and see what your customers think about different recipes.
There may also be some opportunities to improve either a) the quality of your food, b) your profit margin, or c) both by changing your recipe. If you’ve been using canned tomatoes, swap them out for fresh; run the numbers on using slightly higher quality meat. An investment of a few extra pennies per pound may give your customers a lot more value and allow you to grow your profits.
Create Daily Specials
As a restauranteur, one of your jobs is to keep your customers coming back for more. And while people love an old favourite, they also like to see new, exciting things coming from your kitchen. Reworking your entire menu every week likely isn’t feasible, so implement some daily specials.
Not only will daily specials allow you to surprise your customers with new, exciting dishes, it can also be a good opportunity for testing recipes. Think you may be able to increase those profits by replacing your spaghetti al vodka with an eggplant parmesan? Run the eggplant parm as a daily special and see how many customers go for it.
Focus on Upselling
Upselling is a marketing technique as old as money itself. When your server comes around after your guests finish their main dish, they ask if anyone would like to look at a dessert menu. The simple words “chocolate lava cake” may be enough to earn you a few extra dollars from that table.
Train your servers to practice upselling while they’re waiting on tables. They should look for opportunities to heighten guests’ dining experience – a glass of wine before their meal or a cup of coffee after, for instance. The trick is that they can’t be too heavy-handed with it or your customers will feel bullied and may spend less.
Set Up a Loyalty Program
If you’re running a restaurant right, you’re going to have a few loyal regulars who come in again and again. These are the people on whom your business is built. In addition to the dollars they’re spending with you, they’re your most effective form of marketing and are likely responsible for a surprising amount of your customer base.
Reward these regulars with a loyalty program. Every tenth meal, give them a free dessert or give them a coupon for two free drinks on their birthday. Not only will this bring them in more often, but it will also give them more ways to sing your praises to their friends.
Take a Look at Your Schedule
One of the quickest ways to kill your restaurant profit margins is to run an inefficient schedule. It can be easy when you start out to schedule two hostesses, three cooks, two bussers, and five wait staff for every shift. But the truth is you won’t need that same division of labour at every point throughout the day.
Take a look at when your busiest and slowest times are and what staff you have on during those shifts. See if you can move some staff from your slower shifts to your busier shifts. Your staff will spend less time sitting around with nothing to do, and your customers will enjoy a more pleasant dining experience during the rush hours.
Train Your Employees for Service
Of course, one of the best ways to improve your customer experience and lead guests to spend more money with you is to go above and beyond with service. Even small details can make or break a customer’s experience. When you’re training your staff, teach them to look for these opportunities to heighten service.
Teach your bussers to reach around customers’ left sides to retrieve empty plates and glasses so as not to disturb guest conversation during the meal. Ask your chefs to make special accommodations wherever reasonable, and train wait staff to double-check that these accommodations have been met before the plate goes out to the table, especially in the case of food allergies or intolerances. And make it a point to circle the floor at least a few times during your busiest hours to check on how guests are doing; it adds a personal touch to your service.
Improve Your Restaurant Profit Margin
When you’re running a restaurant, maintaining a high-profit margin is crucial. If you’re not seeing the returns you need, take a look at your operation to see if it’s running as efficiently as possible. Focus on elevating your customer experience as much as possible and you’ll be amazed at how your restaurant profit margin improves.
If you’d like to discover more tools to improve your business, check out the rest of our site at Winpos. We provide point of sale systems that can help speed up service and improve your customer experience. Meet your solution today and watch your profits grow.