Rising restaurant costs and the inability to cover them is the reason why restaurants shut down every now and then. Witnessing a decent footfall does not guarantee profits unless you manage your restaurant costs well. It is hence important to monitor and control the costs with Restaurant Management System to run a successful business.
What comprises of increase in Restaurant costs? Food and the labor cost are considered as top reasons for increasing restaurant costs. With the help of cloud-based restaurant pos, you can bring down this value and increase profits in your restaurant.
Not only this, but a cloud-based restaurant pos will also help you to reduce your dependency on manual labor. This can be achieved by automating the entire restaurant operations.
Employ Restaurant Management System that controls your increasing Restaurant Costs
Leveraging automation and technology reduces all kinds of unnecessary expenses that a restaurant incur on a daily basis. Having on board a cloud restaurant pos system will help you streamline your restaurant operations and will keep your cash registers overflowing.
Two most important and heavy expenses that drive any restaurant bear is the food and the labor cost. Here in this article, we will talk about the ways to monitor and control these expenses. We will share how automation can keep a close check with the help of a restaurant management system.
Control Food Cost
Food cost is increasing day by day, this makes it all the more necessary to keep a regular check on it. Your restaurant management software will help to keep your food cost under control. Wondering about how a POS software can help you? Read below to understand the same:
(i) Stock and Inventory Control
You must accept that the inventory is the center of your restaurant business and it needs your constant attention. If you will not do that then you will lose out more than you can expect. A restaurant pos software will ensure that your standard inventory processes are followed, which will streamline your entire kitchen operations.
- A cloud-based restaurant pos will send you real-time alerts the moment an item reaches its reorder level. This report will ensure you to places orders of the items that are really required. Further, it will ensure that you don’t end up generating unnecessary kitchen waste.
- Your restaurant pos system software also reports you with the most and the least selling items. From this, you can smartly revamp your menu, by including more varieties of the most selling items. This way you can avoid purchasing the inventory for the items which are not profitable.
- All restaurateurs brood a lot over internal thefts and pilferage, and the inventory is the most affected section, it is imperative for you to keep a close eye on it. Pos management software, will provide you with detailed item-wise daily consumption reports, beginning and the closing inventory. This will ensure that no misappropriations happen in inventory store of your restaurant.
(ii) Analyzing Variance
Variance is a significant metric that you need to closely check with the help of your restaurant management system. So what is Variance? It is the difference between the actual stock consumed and the Ideal Food Cost. In the Restaurant Industry, A Variance of 3-5% is acceptable due to regular wastage. However, more than 7% is a sign of potential internal theft at your restaurant.
By regularly monitoring the Variance Reports, you can identify the cause and control the same.
A pos management software with a recipe management feature will standardize your recipes and control restaurant costs. These recipes include ingredients and processes to make a dish along with the quantities. Once all the recipes are set, it becomes an SOP for all chefs to follow diligently.
This stellar recipe management feature in restaurant pos system software ensures that your chefs do not mix up recipes. It is a human error which is only possible. In such cases, the prepared dish cannot be reused, and the chef has to only discard it, which increases the overall cost. Such situations impact heavily on your inventory and increase your food cost. Hence, a recipe management feature in your restaurant pos system software is a handy solution and will help you control your rising food cost.
Reduce the Labour Cost
Labor cost is another area which contributes to increasing restaurant and operational costs.
The restaurant industry is a very unstable industry when it comes to staff hiring and retaining, not many restaurants have been able to master it. This is not only a time-consuming affair.
One of the easiest ways to control the rising labor cost is by installing a robust restaurant pos software. This will automate your entire restaurant operations, and significantly reduce your dependency on manual labor.
(i) Automating Manual Processes
- There’s a huge scope of mistakes when billing is done manually. Considering the fact that it deals with money, you must not compromise in this section. Therefore, a restaurant point of sale software automates the entire billing procedures without errors. Also, it is easy to implement and train the staff to effectively use the same.
- Having a pos management software, with a kitchen display system will reduce your dependency on manual labor. A KDS ensures that orders which are punched in the pos immediately reflect on the kitchen screen. Also, if the customer changes or adds anything in his order, that too will be reflected in the KDS instantly. This technology will nullify the to and fro run of a server from the table to the kitchen.
- Managing inventory manually is a very tedious task which increases the chances of manual mistakes. If you want to manage your inventory effectively and efficiently, install a smart restaurant management system which can streamline your inventory operations.
(ii) Regularly Evaluate Your Staff Performance
It requires regular practice to monitor and measure your restaurant staff performance to identify the areas where they could improve. You may want to work on the Key Performance Indicators for your staff to see if they are delivering their assigned duties. As a result, you can enhance their efficiency at work and in turn, improve your revenue and justify the labor costs.
Here a restaurant management system comes handy, it allows you to measure your staff performance to control your labor costs –
- Number of Tables Covered in a month
- Monthly sales and upselling achieved by each one of them
- Tracking the discounts offered by the server
Hence, we understand that it is imperative to control unnecessary food and the labor costs in your restaurant business. In conclusion, implementing a smart restaurant management system enables you to effectively control such restaurant expenses. Therefore, install a cloud-based restaurant pos right now!