Reduce Food Cost 2-3% Overnight
How would you like to reduce food cost 2-3 points overnight? How would you like to overcome rising food prices in seconds? Watch this video to learn how to reduce your food cost virtually overnight.
“How do I overcome my rising prices?” That’s a question I get all the time. But before I answer that, I want you to know that this solution I’m offering you here is not the only way to overcome rising prices and lower restaurant food cost.
Beating up your sales person on price is a small piece to what really costs you thousands of dollars mismanaging your product through waste.
But for the purposes of this restaurant management tip, let’s look at how in your restaurant to reduce food cost by 2-3 with one simple system based on pricing.
The first step in this process is to go to your restaurant food distributor and request a descending dollar report. It could also be called a descending case report. It’s all the products you’ve purchased form that vendor in the last three to six months. Unless you’ve had a menu change in that time – then adjust the request to match the time you introduced your new menu. You don’t need everything you’ve purchased, just what you have done in the last six months.
Your top 10 items represent 50 percent or more of every dollar you spend on food. That’s amazing because it means if you can reduce the amount you’re spending on these top items, you can reduce your food cost by 2-3 points.
Have you ever gone to a food show and had a vendor offer you a special deal on an item if you signed up right then and there? They can do that all year long! There are ways to save money on even the most popular products – especially the most popular products because it’s likely there is marketing money tied to these items that you can circumvent.
So, to move toward this 2-3 percent savings on your food cost, use your descending dollar report to try to find like or better products at cheaper prices, which can have a huge impact on your business. For example, you can take something you usually spend $3,000 a month on and get it down to $2,500. I’ve had members cut their spending by 5, 7, even 10 percent.
Don’t beat up your distributor and demand lower prices. (That’s a prime vendor agreement – covered in another video tip!) Instead, take a look at what you’re purchasing.
Go to your broad line distributor, or all of them, and request a descending dollar report, showing you what you spend the most money on to what I spend the least amount of money on.
And please note – we never suggest that you buy cheaper product – you want like or better quality for less money. Don’t go against your core values or risk your menu’s consistency.
If you would like to learn more ways to reduce food cost, read our free special report, Breaking Away from the Insanity: How to easily take control of your restaurant and make more money. Download it here. Be sure to visit our YouTube channel for more helpful restaurant management video tips.