Many businesses are suffering now from rising costs and economic uncertainty. Restaurants' economic struggles are also visible due to the fuel and food costs increase.

External factors that affect restaurants are unavoidable but at the same time, their impact can be controlled. Restaurant operators need to be aware of these factors and brainstorm ways to control them.

Remaining competitive in economic inflation is not easy, especially when dealing with uncontrollable factors that directly affect your decision-making process and service delivery. The risks of an economic recession are increasing in 2023 as per a World Bank’s recent study with a global and lasting impact.

One thing you have to consider is that diners experience the same concerns as yours during economic uncertainty. They are worried about their income, the stability of their jobs, and their overall survival.

The first thing they do is to cut down on unnecessary spending such as dining outside.

Another point is that while revenues are more likely to shrink, restaurants still incur fixed costs that should be paid whether or not a restaurant is making profits.

So, how can you secure your profits during these times?

What strategies can you apply to keep making a profit during economic uncertainty?

Track and control your costs

Monitoring your costs is a task you should be performing already but when things get a bit absurd and when food prices go higher, you need to investigate further and look for different ways to control costs.

With a cost breakdown, it’s easier to detect costs that you can lower and control. Check your labor costs and cost of goods sold in the variable costs section. With a thorough analysis of all costs requires to run your restaurant, ways to control your costs will be clearer.

Dig deeper into supplier invoices and find ways to cut down prices by controlling certain purchasing habits. Relying on different suppliers pays well during economic struggles where you can always request different price lists for cheaper items.

Be particularly meticulous with controlling waste even with the littlest things. Check purchase orders related to cleaning detergents, napkins, and other expenditures.

Appreciate your inventory

Your inventory is your source of revenue. You should review everything in your stock and take care of your inventory items as if it’s the most precious of your assets.

Why should you focus on inventory management?

You can identify fast and slow-moving items with a thorough follow-up of your inventory. Once identified, you can use your menu to use the slow-moving items and in parallel, you should slow down on ordering these items as well while monitoring fast-moving items to ensure they never run out.

Monitoring your inventory allows you to reduce food waste by identifying items with a near-expiry date so you can use them in your recipes. It also detects any signs of employee theft when you keep missing items from your stock that are not explained or justified.

Optimize each menu item, its ingredients, and its price

Calculate plate cost by breaking down each ingredient cost depending on the portion size. A chicken platter cost should include all ingredients including the marinade, the sides, and the toppings. Do not omit any ingredient.

This cost breakdown enables you to check the contribution of each item to the profitability and to the cost at the same time.

Going from there, you can decide which item to use less and which to add more. Depending on the most profitable ingredient mix, you might alter the recipe or give it a twist.

You will also be able to check if you’re undercharging a certain item given its cost, especially with the rising costs of food.

Follow strategic staff scheduling

You cannot be overstaffed during economic uncertainty. Take control of your staffing and encourage multi-tasking so fewer people can do more.

Use technology to decrease the visits of waiters to the tables so they can use their time more efficiently. QR code menus are one example of how can customers rely on the digital menu instead of calling the waiter and asking him about the menu items.

Boost restaurant sales with fewer staff

One more time, rely on technology to serve more customers with less staff. A self-ordering kiosk is your way to encourage more orders with fewer staff. The SOK takes customers’ orders with any add-ons and even offers and at the same time it works on upselling by suggesting additional items to the customers.

Try promoting your slow-moving items

While you might be heading to increase your prices on your dishes, you shouldn’t completely ditch the idea of promotions that attract customers even in an economic crisis. You can still create promotions on slow-moving items that are laid in the warehouse or stock.

Even when you increase your prices, you can still create offers on certain combos or promote a happy hour with featured discounted drinks and meals.

In this case, combine non-popular items with popular ones especially if they have high profitability.

Surviving economic uncertainty and crisis is not easy for businesses and individuals. Nonetheless, you should gather your reports, do your analysis, and come up with solutions to stream revenues and control your costs.