9 Tips for Keeping Food Costs Down

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Making your restaurant profitable can be an extremely tricky prospect. It is incredibly difficult to price your dishes so that you can cover ever-fluctuating food and commodity prices in addition to paying the rent and compensating your employees.

With dining out at an all-time high, it’s more important than ever for restaurants to keep an eye on their bottom line: how much is being spent on the food, and is it cost effective? While you can’t change the constantly changing prices of food, you can do your best to keep track of where your money is going, and use this information to make educated purchasing choices in the future. This post details tips which will help you keep food costs down in your restaurant, regardless of the style of cuisine or your location. While each tip listed may not have a large impact alone, when put together, they can have a huge impact on your restaurant’s bottom line.

Track food prices. The prices of many foods will fluctuate based on availability and market value. For instance, eggs may decrease in value one day, where certain types of fruit will increase in price the next.

To a certain degree, small fluctuations will balance each other out. However, there are certain price increases that can’t be ignored. If you are tracking prices, you’ll notice things like when almonds go up $2.99 a pound. When things like this happen, you’ll be better positioned to make a choice about whether or not you’d like to make an alteration to your menu. For instance, if you’re buying almonds for your pastry chef to make a specific dessert, it’s possible that another nut which is cheaper right now could be substituted without a huge effect on the overall customer experience.

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Keep a close eye on inventory. Tracking inventory is probably one of the least glamorous jobs you can take on as restaurateur, but it’s one of the most effective in keeping food costs down. By keeping track of what you’re buying and where it’s going, you’ll be much better able to streamline costs. 

Conduct a weekly inventory of perishable and non-perishable goods and alcohol and non-alcoholic beverages, as well as serving-related supplies like glasses, silverware, and linens. As time goes on, this weekly check-in can help inform your ordering. For instance, if you notice that every week, you end up with ten pounds of lettuce that are being thrown out, you can probably order less; over weeks and months, this will save you money. Monitoring inventory will also allow you to keep note of sudden fluctuations, making it easier to detect if items are being stolen or used inefficiently.

Form a purchasing collective. If your restaurant is small, or if you have a single location, you may have trouble meeting some order minimums from food vendors. So, you could either eat the cost and order more than you need, or you could join forces with another local business to make collective purchases.

For instance, say you want to work with a strawberry vendor but their minimum is 30 pounds of strawberries. You might not need that amount, but if you join forces with a local smoothie shop and split the order, you can both get a good price and not be left with more fruit than you need. Many vendors are open to this type of situation, which leaves all parties satisfied.

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Encourage mise en place. One of the hallmarks of a well-trained chef is that they have a good grip on mise en place. Mise en place refers to having the kitchen set up and prepped for the day of cooking ahead. Depending on the format of your restaurant, this could mean having vegetables pre-chopped, meat soaking in a brining liquid, or seasoning mixes pre-made.

Having the prep work done in advance can make it easier for the kitchen to keep track of when they need new ingredients, so that there are no emergency orders or rush trips to the grocery store, which cost more than buying ingredients wholesale. Completing prep work in advance also has the added benefit of streamlining service to your customers!

Buy seasonally. Using seasonal produce isn’t just a way to capitalize on the “eat local” trend; it’s also a smart way to keep costs down. For instance, apples are cheaper when they are in season in early fall. They are also at a higher quality. It makes sense to incorporate them into your menu then. But when spring rolls around and they are more expensive and the quality is not as good, it’s probably time to switch to strawberries. Using seasonal produce will not only bolster your bottom line but will make your cuisine taste better.

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Keep track of waste. This is related to tracking inventory, but involves taking it a step further. In addition to keeping track of what inventory you have, keep an eye on what is consistently being thrown out. For instance, if you notice that your sandwich platters, heaped high with fries, are constantly being cleared with half of the fries still on the plate, you might consider reducing the portion you offer. Or if you notice that every week you’re throwing out gallons and gallons of milk, it may be time to alter your order or find other ways to make use of the ingredient.

Be consistent with portioning food. For inventory tracking and waste tracking to be effective, you’ve got to be consistent with portioning your food. This means that when a burger comes out of the kitchen, it should have a consistent amount of meat used to make the patty, and the amount of french fries should be constant.

While some natural variation will of course exist, keeping your portions as consistent as possible will help you reliably maintain inventory and track food costs. As a bonus, consistency in dishes is also attractive to repeat customers.

Price items appropriately. Do you price your dishes arbitrarily? This isn’t the way to do it. You have to consider all that goes into the food to really make an educated and appropriate pricing decision Here are some of the key things to consider:

Direct costs: How much do the ingredients for a given dish cost?
Perceived value: How much is a dish “worth”? For instance, people are willing to pay more for fish or a premium cut of beef than they are for grilled chicken.
Prep time and labor: How long and how much labor is required to make the food?
Overhead costs: In addition to paying for the food and the time, the dish should be contributing to your rent.
Market value: How much will people pay for such a dish in your neighborhood? In a busy urban area, fetching $17 for a burger might not be a big deal; it might be a harder sell in a more out of the way or smaller-town locale.

Have backup plans. If costs change, or a supplier suddenly goes out of business, don’t be left in the lurch (or having to pay expensive prices to maintain your stock while you scramble for a new vendor). Always have a backup plan for your most important suppliers, so that if things run amiss, you’re not left with unexpected expenses.


Conclusion: Running a restaurant can be tricky and costly. But by taking the time to consider the details of your food use and purchasing, you can cut food costs in various small ways that together have a huge impact. Details matter when it comes to keeping your restaurant successful, and investing the time to look at how you are using your food can help you remain profitable in the long term.
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