Tips To Combat Rising Restaurant Food Costs

As the cost of goods continues to rise, the foodservice industry works to combat restaurant food costs. And while inflation can’t be controlled, there are things that restaurant owners and managers can do – from editing the menu and closely maintaining inventory – to help.

The Impact of Rising Food Costs

The cost of ingredients is one of the top expenses for a restaurant. But ingredients aren’t the only thing that impacts food costs. Portion sizes, food waste, and other factors account for rising food costs per month. And with menu price inflation hitting 40-year highs, restaurants need any tools available to offset costs and avoid severely impacting profits.

Using a food cost formula is a great place to start. By determining the cost of each ingredient per dish and dividing the cost for each batch by how many sales can be generated, the food cost per unit is determined. Using this formula, operators can help ensure it doesn’t cost more to make the dish than sell it. Also, take into account ingredients that may go bad and if prices may increase due to seasonality. These factors also play into food costs.

Another important step is to find out the restaurant food cost percentage, which is calculated by dividing the food cost by total revenue. Food costs should land between 25 and 35 percent to make things profitable. But what if the price of ingredients continues to rise? How can foodservice businesses control both food costs and percentages? Menu engineering can help.

What Is Menu Engineering?

While restaurant food costs aren’t controllable, the design of the restaurant menu is. Known as menu engineering, the design of menus can help direct customers to items that help increase profits.

By taking the results of the food cost formula, management can decide which items they want to highlight on restaurant menus. Some ways to engineer a menu to help draw the eye to specific menu items include:

    • Increasing font sizes
    • Highlighting higher profit choices
    • Put eye-catching photos on the menu
    • Rearrange the layout of items so the most profitable are the most noticeable

Another tip to consider is to create a QR code for customers to use that takes them to an online menu. Not only does this help with sanitation, but it also eliminates the need to re-print menus whenever there are menu changes.

Alongside using a food cost formula, restaurant food cost percentage, and menu engineering, what else can be done to help control restaurant food costs?

Help Reduce Food Costs

Restaurant food costs may seem ungovernable, but there are some things that can help. By monitoring food and ingredient waste, restaurants can keep foods fresh as long as possible. This extends the life of the ingredients and lowers shopping costs. A food preservation system is a cost-effective way to greatly extend the life of produce. Also, buying local foods when in season may mean lower prices than if food is bought that’s shipped from far away and is out of season.

And if restaurant food costs continue to rise, consider equipment that has automation features. While they won’t assist with food prices, they complete repetitive tasks that allow staff to concentrate on other things and lower labor costs.

It’s easy to help combat food waste with the Bluezone Food Preservation System.

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Topics: Restaurants