Since the pandemic, there has been a lot of added pressure on the restaurant industry to switch gears and make accommodations for customers and employees. While we started to see more people choosing to dine-in in 2022, we also saw inflation raise the price of food, beverages and labor keeping restaurants on their toes and figuring out their next move. What will this mean for restaurants moving forward and how can they continue to bring in new employees and customers in the new year? We will help you answer these questions so your restaurant can navigate the projected inflation with insight and confidence.
At this point almost all restaurants have raised their prices. According to a study done by the National Restaurant Association, over 90% of restaurants have raised their menu prices. Not only have restaurants had to increase their prices, but they have also had to change their menu to accommodate the rising cost as well as the ingredient shortage. Restaurant owners have also had to increase pay for their employees, which means that profit margins are getting smaller. Let’s talk about where you can start and what can be done to help get your restaurant get back to a wider profit margin.
If you have not already invested in some type of technology software to help you manage your restaurant, this is going to be the first place you want to start. Having tech-based support is not only going to make your life easier, but you will find an increase in accuracy and efficiency, find holes in labor costs (which we will cover more next week), and get a birds eye view of your overall profit margins. With all of this information readily available for you at all times, you will be able to make educated decisions that will benefit your restaurant. Now, more than ever, you want to know where every penny is going, and this will allow you to do just that.
Buying from local markets can help keep costs down as well. When you know the people who you are buying from, you can build relationships and know when prices go down on certain items. You can offer menu specials based on what is in season and that can potentially help you save a significant amount of money.
When it comes to employees, you want to be sure they feel valued and appreciated. Many restaurants are now paying employees more money due to inflation as well as the labor shortage. If you can’t compete with pay in your area, you want to be sure you are offering other incentives that will encourage employees to stay. Having a fun and healthy work culture is a great start. You will also want to provide adequate training, a flexible work schedule and even a rewards system where you give a small bonus or gift card to a hard working employee each week or month. All of these are likely to assist in the decreased turnover, which is another expense you want to see go down.
Remember, customers are expecting to see higher prices when they go to a restaurant. For the most part, they will not be shocked or outraged, but they will expect good service and an overall good experience. Reinforce to your staff the importance of good customer service, invest in technology that can show you where your money is going to help alleviate some of the financial pinch you are likely feeling from inflation, and do what you can to make sure your employees feel appreciated.
