Whether your restaurant has been around for decades and serves thousands of people each day, or is a brand new establishment that serves hundreds of people, the common ground of all restaurants are their similar monthly expenses. Here are some common monthly expenses that should be considered when opening a restaurant, and if you have been in business for years, it’s a good idea to evaluate these expenses to be sure you’re not losing money.
- Food and Beverage
This one is the most obvious since it’s your business. Thankfully, there are software tools that help you order the correct amount of product each week, eliminating over or under ordering that can be very costly. Having access to data that shows you how much product you need to order and even alert you to vendor price changes is invaluable and will help you make informed business decisions. Having detailed recipes will also help with product usage, ordering and keeping accurate inventory counts.
- Equipment
Restaurants typically require large machinery in order to operate efficiently, and this equipment can be rather expensive, and will require regular maintenance. Restaurants can rent equipment, which comes with monthly costs, but even if you own the equipment, it is smart to set aside money each month for equipment maintenance.
- Labor
The size of your restaurant and amount of product you sell determine how many employees you need. Although labor is a primary controllable cost, It is an area where many restaurants lose money. Having a labor percent goal can help you stay on track, and with the help of labor scheduling software, you can be sure to hit that goal. Having the right amount of staff to support projected sales will keep your restaurant efficient. Alerts of employees clocking in early or clocking out late and notifications of employees who are getting close to overtime can save a lot of money. Labor reports can be checked anytime, anywhere, keeping you informed and always prepared to make the best moves for your business.
- Building and Utilities
Whether you rent a building or own a building, restaurant owners will typically have monthly rent or a mortgage payment. Along with having a building, you have utilities, electricity, insurance and maintenance costs. It is also important to have some rainy day money for unexpected expenses that can occur, like plumbing issues or a hole in a wall. Down the road you may want to make some larger updates such as new flooring or a new roof, so putting some money aside each month is a good way to help your future self when something is in need of repair or for updates.
There are a lot of monthly expenses, and every restaurant is different, so it is important to evaluate your expenses and decide for yourself what expenses you will need to make monthly. Technology might be a monthly expense, however in the long run, it is an expense that can save your restaurant money and time. Be sure to look at what you are spending and how it affects your restaurant!
