How to Increase Restaurant Sales While Slashing Costs Internally
In normal times, restaurant owners are always looking for ways to increase sales, but today, with all the COVID-19 business restrictions, the search for ideas is more frantic. While the instinct is there to be looking to increase restaurant sales, I want to point you toward the second strategy to also be working on, which is slashing costs internally. That’s what will make any extra sales you do bring in worth it. Click below to watch the video or keep scrolling to read how to increase restaurant sales while slashing costs internally.
You might be one of the few restaurants whose sales have actually increased, or you might be a typical restaurant who's seen a 25–75 percent drop in sales. And every time you feel like things are getting back to normal, your state has reimplemented tight business restrictions to keep people safe. Add to the drop in sales, food prices have skyrocketed, labor cost is out of control and your rent feels like cement shoes when you're trying to tread water in the middle of the ocean with no life preserver.
So how do you cut costs at the same time?
Look, I know you're tired of hearing the phrase “pivot your business.” That was so eight months ago.
- You added to-go ordering, third-party apps, outdoor dining.
- You raised prices.
- You added prepared foods for people to walk in, grab, take home and make at home.
- You reduced your menu items.
- You replaced ingredients to find savings.
- You started going to Costco and Sam's Club just to save a penny.
- You laid off team members which crushed your heart.
The truth is, what you really need to focus on now are the basics starting with making Restaurant 101 your priority.
Restaurant 101 has kind of changed. Yes, we know it's hot food hot, cold food cold, a clean, safe work environment for the guests and employees, wow customer service and an incredible product. It's basically great hospitality. But now because of third-party delivery apps, because people are picking up items and taking them home, you have to also find a way to make sure the food from your restaurant arrives at the home in a way you can be proud of. You want the guest to say, “Wow, that's an incredible product.”
Then you have all these restrictions to make sure that you keep people safe with gloves and sanitation restrictions and making sure you’re visually cleaning and putting partitions between tables. We're doing everything possible to make sure the guest has not only the best experience, but they feel safe. In these ways, Restaurant 101 has truly evolved. But the basic or major part of Restaurant 101 is still great hospitality. That hasn't changed.
Once you’re certain you have Restaurant 101 perfected (as perfect as it can be, anyway), consider two other ideas for maximizing your sales and a more efficient approach to labor to cut some expenses.
There's a book I want you to read by author John R. DeJulius the Third. In it he writes in his book "Secret Service: Hidden Systems that Deliver Unforgettable Customer Service." He says, "When you deliver wow customer service, you make price irrelevant." See, I don't want you to compete on price. I don't want you to sit there and say, “Well, the restaurant next to me sells a burger for $10, and I sell one $12. I need to reduce my price to compete.” Instead, John says, you go out there and you train great hospitality. You make sure that you are anticipating your guests’ needs and meeting them for them, that you're taking the extra steps to make them feel special. Because the idea is this. When I go through your restaurant, it's not all about jazz hands. It's about not breaking the connection between your guests. In hospitality, we make sure that all the needs are met for the guest. At any point in their conversation, they should have to go, wait, hold on, I still I need something to drink.”
It's those little things, the little things that we know more about our guests. When you start to know their names, when you know what their favorite bottle of wine is, when you can start to say, hey, how are your children? Now it may start with bonding at the table. Instead of saying a corporate restaurant, "Hi, my name is," say "Hey, that's a great hat. Where did you find that? Oh, that's one of my favorite teams, too."
Develop a bond with the guests, not just hi, what can I get you, and serving as a walking vending machine. These are all things that can be trained.
Cutting labor dollars
Also, what if I told you what you've been taught about staffing for great hospitality has been all wrong? Think about it. Think about what your restaurant looks like when you have more employees than you have customers. What are your employees doing? They're playing grab ass at the time clock, right? They're back in server alley and they're talking about their conquests. They're snapping towels. They're screwing around. And that's when you have the worst Yelp reviews you could possibly ever have because the guest is being ignored.
Now, if you were able to trim your labor to a point where you still have your seven servers on a Friday night, but staggering their start times a bit to limit that lag time, you can save on labor. Consider bringing in two servers at 4 p.m. and two at 5 p.m. and the rest at 6 p.m. because that's when your rush starts. You still have seven servers during the rush, but you’re not bleeding at the time clock. This uses your labor more efficiently.
If you want to increase your sales and decrease your costs at the same time, you need to focus on training, managing and executing great hospitality. This is still the number one way to separate yourself from the competition and ensure your restaurant will be around for decades to come.
I cover Restaurant 101, putting systems in place and more in my book. Order your copy of Restaurant Prosperity Formula: What Successful Restaurateurs Do here.
You can also complete a free restaurant evaluation. It's a great way to identify immediate opportunities where you can make things better in your restaurant.
Be sure to visit my YouTube channel for more helpful restaurant management video tips.