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    14 Ways to Reduce Overhead Expenses and Increase Profit Potential

    [fa icon="calendar"] Mar 28, 2018 9:06:00 AM / by Dan Pecha

    Restaurant Staff.jpg

    In an industry plagued by labor shortages and relentless competition, restaurant and foodservice operators often find themselves with shrinking margins and, as a result, profits. Protecting margins by doing more with less has gone from a smart business strategy to an everyday best practice, leaving many to consider how — or if — they can reverse course on this erosion of profitability.

    While certain industry challenges won’t be easily overcome, there are steps you can take in key areas to lessen the impact on your operation, staff and bottom line — including adding pre-made dough balls and pizza dough to your lineup. Use these practical solutions to maximize your resources and reduce overhead expenses:

    Labor and Training

    1. Cross-train. Most team members are willing to “pitch in” where needed, especially when they feel confident in their contributions. Empower them by investing in ongoing training. Staff members — particularly those who are part of the back-of-the-house crew — who have the tools necessary to work in multiple roles reduce the need to hire dedicated employees for recurrent tasks like dishwashing, prep, stocking, etc.

    2. Implement Standard Operating Procedures (SOPs). Defining SOPs provides uniformity and improves quality across shifts and locations — a boon for delivering a stellar customer experience. It also gives your team a singular focus that ultimately saves money, streamlines the training process and reduces waste.

    Click here for a list of 20 SOPs every pizzeria needs

    Download our guide to creating SOPs here

    3. Use pre-made dough balls and pre-made pizza crusts. Working with your distributor to get pre-made dough balls and pizza crusts is more than a function of convenience. You have access to a variety of products from experts like Alive & Kickin’ Pizza Crust that add depth and profit potential to your menu without ratcheting up preparation or ingredient costs.

    Learn what products are right for your operation in our Product Overview guide

    Ingredients Ordering and Food Waste

    4. Rethink preparation. Weighing and measuring toppings ensures per-pie consistency and eliminates costly waste caused by “guesstimating.” Here’s where pre-made dough balls are particularly beneficial. Your distributor delivers them in scheduled numbers and perfect portions, virtually eliminating excess dough waste and the expense associated with scratch-making dough like dedicated labor, tools and large quantities of flour and yeast.

    5. Control portions. It’s estimated that 11.3% of the total amount of food purchased in a full-service restaurant is wasted. Given that food costs are the second largest expense behind personnel, that’s a lot of potential profit going in the trash bin. Paying strict attention to serving sizes and plating accordingly is an easy way to manage both cost and waste, as well as using any leftover ingredients like dough, sauce and toppings to create existing menu items.

    6. Limit your menu. Trying to anticipate every customer’s favorite dish or special request makes for an unwieldy menu, an undue amount of necessary on-hand ingredients, and near-impossible back-of-the-house management. Limiting your menu to signature, popular and the most profitable dishes eliminates cost on several levels: fewer ingredients, no dedicated labor for ordering and/or managing ingredients, and even reduced printing costs as you’ll likely have to upgrade your menu less often.

    Technology

    7. Update your Point of Sale (POS) system. From a technological standpoint, few things can drain restaurant profits like a legacy POS system. Ditch the expensive and quickly obsolete hardware for cloud-based POS options that provide current software, solutions and user support to help you work efficiently and make purchase and staffing decisions based on real time, relevant data. Another value-add of POS systems is that they instantly cut the number of employees required to manage inventory and cost tracking.

    8. Give your servers some techie assistance. It’s no secret that hiring times are tough. Take the pressure off of your short-staffed team with tabletop tablets and touchscreens for order-taking and payments. Sound impersonal? Don’t give it another thought. Tablets and touch screens are ubiquitous, and people are coming to expect that devices are available to speed up transactions, including in restaurants.

    Utilities

    9. Don’t wash money down the drain. There are several easy ways to get your water bill under control. Letting frozen pre-made dough balls run their proofing course instead of running them under water, using water-saving pre-rinse spray valves and faucet aerators at dishwashing stations and providing customers with water only upon request are but a few.

    Get our quick-reference guide to properly proofing pizza dough here

    10. Lighten up on electricity. This is easy advice that can be difficult to remember. Turn off lights in areas that aren’t being used, and replace bulbs in constantly used fixtures with energy-efficient lighting options like LEDs.

    11. Don’t overburden your cooler and refrigerator. Overstocking these appliances is asking them to work harder, which costs you more every month compared to fridges and freezers that are allowed to properly circulate cool air. Organizing your cooler for maximum efficiency keeps costs down, too, as employees aren’t milling around looking for ingredients while the door is left open and cool air escapes.

    12. Get the dish on your dishwasher. Find out if your dishwasher is a high-temp model equipped with a water tank with heating elements. If so, turn it off at night. There’s no need to expend the energy on heating water that won’t be needed for an extended period of time. Also, regardless of dishwasher type and provided it’s feasible for your operation, consider running one large load at night rather than several smaller loads throughout the day. It will save water, energy and money.

    Advertising

    13. Be selective. Nixing your advertising budget to save money will cost you in the end. While a few cuts may be in order, you can still leverage no- and low-cost social media options to stay connected with prospective and existing customers. With platforms like Facebook, Twitter and Instagram, you can post enticing pictures and videos of your delicious food, and inform customers in real time about new menu items, daily specials, available coupons, upcoming events, etc., at your restaurant.

    Learn the basics of social media marketing for pizzerias

    14. Keep it local. Customers support restaurants that support their communities. Tap into this trend and gain some free word-of-mouth advertising by putting your brand behind activities that appeal to the neighborhood like a trivia night, or opening your space to local music talent. Community engagement serves as smart double-duty for your restaurant: lower marketing costs and higher traffic totals — both of which translate to higher profit potential.

    Over time, practicing these steps will take your operation and your margins to a good place. So will the advice you’ll find in our eBook, The Efficient Kitchen: Doing More With Fewer Employees. Click the button below to access your copy now!

    Efficient Kitchen eBook

    Categories: General Operations, Kitchen Operations

    Dan Pecha

    Written by Dan Pecha

    Pizzeria Consultant