5 Effective Ways to Reduce Restaurant Business Operation Costs


By now, you’ve probably heard that running a restaurant can be difficult. Well, those people aren’t lying. The restaurant industry is a make it or break it environment that leaves many restaurateurs running for the hills with their tails between their legs. One of the biggest financial stressors, of course, is operational cost. Not only do you have to pay for overhead, but you also have a slew of permits and licenses. If you intend on having a full bar operation, you will need a liquor license, which is another expenditure that could drain your capital reserves dry. Here are five effective ways to reduce restaurant business operation costs.


  1. Start small. If you are a new restaurant, you probably don’t want to rent out the biggest space on the block – try going for the corner spot and then see if business picks up. Before you rent out the big space, you want to make sure you can fill at least one table. Once you have a line around the block and a full reservation book – and the phone is ringing off the hook – you can probably start thinking about upgrading. During the startup phase, starting small is the best way to reduce operation costs.
  2. Limit construction. One of the biggest expenses for new restaurants is construction. Every restaurateur thinks that his or her restaurant needs to look the most fancy or authentic. However, this can often be a pitfall for new restaurants. In the beginning, you should be focusing on the food – not the architectural layout. If you take money away from the kitchen and the ability to make incredible dishes, the interior design won’t matter at all. So, stick to a rougher, more industrial look in the beginning and once the restaurant is really chugging along, you can start remodeling.
  3. Research the best retailers for kitchen supplies. As a restaurant – a startup restaurant – you will need a lot of supplies and appliances for the kitchen. These appliances include freezers, ovens, stovetops, grills, range hoods and more. Down to the filters you put in your range hoods, you want to find a great deal on all these appliances. For instance, you can visit HoodFilters.com for some incredible bargains on range hoods and other essential kitchen supplies.
  4. Limit the amount of food you have in your freezer. You may think that you need to stock up on food and other items, but a lot of these items will end up going bad anyways and you will have to throw them out. So, you may simply want to reduce inventory to begin with. Not only will this save you money, it will also save on food waste – millions of tons of food are wasted each year because restaurants over stock.
  5. Install cameras around your restaurant premises. It is a grim statistic, but a lot of restaurants lose money from employee theft – these items can often be too small to notice at first, like food items, but it could start to become a serious problem if you let it get out of control. In the end, by installing cameras, you can cut down employee theft and save your business a lot of money.



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