How Restaurant owners cut back costs

Have you ever wondered how much restaurant owners earn? It has something to do on how they cut costs with limitations. Every owner has different ways to cut back and if you’re thinking of starting a food business here are few major ways on cost cutting.


You should know how much the items on your menu will cost. First, you have to lower your inventory levels by evaluating your inventory byproducts, and by reducing excess inventory. In that way, you will have less waste and spoiled products.

Make a daily inventory. It is the basic yet most effective way to control which product you should have a stock in bulk, depending on which food on the menu sells best.

Make sure to maximize the use of each product. Reusing an ingredient won’t be a big deal to the customers. By maximizing the use of each product you will have to buy less and stock less. This will be good for you as you will be ordering and stocking in bulk. Buying or ordering a large portion/amount of products will give you a big discount, which is a great way to save on your expenses.


As stated on Parkinson’s Law, “Work expands so as to fill the time available for its completion.”, when an individual is given less time to do something, he will work fast to get things  done. It is important to prepare a scheduled labor based on the number of employees, customers and sales. Sometimes you will have to adjust your employees work hours to meet the work load and the desired sales.

Make sure you have the manager(s) a list of scheduled employees on hand. Shift cards is a handy tool for every employee, it serves as a tool for making important notes that will be logged in the manager’s logbook.

It is a wise move to maintain at least half (or less) of your staff as part-timers. You will need part-time employees to maximize the manpower during peak season. But of course you will have to rely on their schedules and organize it right.


You have to take care of your business’ financial status, we all know that. Do not allow yourself to ignore financial shortage, even a single penny counts. Do not forget to focus on your highest gross profit menu items, disregard the cost of it. Higher food cost most of the time results to more profits.

Buy only what you need. Buy items that are written and needed on your menu. This will result to less waste and spoilage, and will it will also help you save money.

Remember to use a proper cash checkout form as it will be easier for you to calculate cash over/short with each checkout. Yes, you have to do a lot of calculation here, but at the end of the day all of it will definitely be beneficial and worth it.

Always report and calculate your sales and labor costs every week to be aware if there are issues that needs attention and needs to be fixed.

You might find it helpful to use these steps as a list to spot potential problems in your business. It is important to remember the positive effect that the successful application of these reminders may result to a great achievement of your business.

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