If you are working in the restaurant industry for some time, you might be well-versed with the fact that how slim the restaurant’s profit margins are. A restaurant’s profit margin is determined by two high-level components – sales and expenses. Increasing top-line sales is essential to increase bottom-line revenue, but at the same time controlling costs is also crucial. And this is now possible by leveraging the power of technology. The restaurants can track and analyze the aspects of their business with data that wasn’t previously available, simply with the help of technology. One can use technology to offset the rising cost of goods sold. Let us find out how?
- Tracking Cost Of Goods Sold Accurately and Frequently – The power of technology can be leveraged to track the cost of goods sold. This is something that captures the actual cost that is incurred to make food items, pulling from inventory data and up-to-date vendor prices in an inventory management system. Recording and reviewing the CoGS help in proactively staying ahead of the trends in inventory tracking and also optimizing the costs and adjusting the negative trends before they become persistent costly problems.
- Engaging in Tight Inventory Control – When you have proper control of the inventory, you have critical insights into the food costs, and this would further help in taking informed purchase decisions that would further affect the overall CoGS. Technology here works in the form of inventory management software, where the sales information can be immediately pulled to track the theoretical inventory, and processes like uploading invoices, updating item prices, and also tracking recipes can be automated.
- Tracking Usage and Yield on Each Food Item – Restaurant businesses can use technology to calculate recipe costs in a more accurate manner. The recipes are mapped to a POS system and combined with food cost information from invoices and current inventory. This data can be further used to cost out menu items down to the penny, understanding the exact price of each ingredient in a menu item.
- Leveraging Menu Engineering to Promote High-Margin Menu Items – Another way to cut on food costs is by making the most of menu engineering. This compares the data about the profitability and popularity of different menu items. Using technology makes it more reliable and can help in making smart decisions about price changes, ingredient substitutions, or promotional campaigns.
The advancement in technology has completely transformed the way businesses performed their daily activities, and when we talk about restaurant businesses, from ordering food online to cutting down operational costs, everything is backed by technology.
If you are a restaurant business owner looking for any assistance in running your restaurant or need professional guidance at any point in time, then the Enterprise Restaurant Consulting team can help you with all your restaurant-related worries. At ERC, we have a team of seasoned experts having complete knowledge of restaurant-related activities. For more details, visit our website today i.e., https://erestaurantconsulting.ca/, or speak to our team at 1-647-209-4153, and they will help you with the queries.