Just how important is it to monitor and control restaurant costs in a multi-site casual dining environment? At Venners, we say it’s hugely important. But it’s not our favoured starting point.


Restaurants are in the unenviable position of having positive cash flow. Controlling the costs of a restaurant business is all about taking advantage of this. It is as important to forecast the cash flowing in and out of the business as it is the costs themselves. There a number of simple steps to ensure that the tide of the bank balance doesn’t drift too far out.



1. Get Your Stockholding Right


Reviewing each of your site’s stock on hold levels is a good place to start. Each site may get three or more deliveries a week so we always advise clients to judge the holding to match (you’d rather have the money in the account than on the shelves). You’d be amazed to know how much a good stocktaker can help you achieve the right level of stockholding. Recently our stocktaking division helped this customer reduce their stockholding for their restaurant area by a whopping 45%!



2. Choose Your VAT Periods Wisely


Scheduling Restaurant CostsWhen first registering the business, it helps that the VAT periods are out of sync with the rental quarter days. Paying rents and VAT can hit hard. But did you know an application can be made to HMRC to adjust your cycle so that it’s out of step with rents? That can avoid sinking into the overdraft that many businesses use at quarter end, cutting bank fees.


So to controlling costs (yes, we all push for the best prices) but keeping control and monitoring costs helps to forecast cash flow, avoiding nasty surprises that can trip a business up.



3. Pay Suppliers Systematically


It’s a good idea to ensure that payment to suppliers is regular. A missed month can catch up with you when the cash is at a low ebb.



4. Forecast Payroll Costs


Forecasting payroll costs to ensure that holiday cover is factored in is equally important!

Consultant advising on how to control restaurant costs



5. Record Your Meter Readings Regularly


When it comes to heat, light and power, have sites record the metre weekly. You want to reach a point where you can predict bills. And a warning. Do not be tempted with fixed price billing, unless you can keep a meticulous eye on usage to ensure it is set correctly.



6. Frequently Check Prices and Push for the Best Deals


So yes, this too is a key point in controlling your restaurant costs and probably the most obvious way!



7. Monitor Your Spendings and Goings Out Closely


Restaurant owner monitors Restaurant Costs

But controlling your restaurant costs shouldn’t stop at checking prices. Controlling your spending is key and planning the cash flow allows you to predict bills and foresee any issues before they bite.



Did you find this article helpful, or have you got any further questions that you need our consultants’ help with? Book a free 30 minute consultation with one of our consultants by filling in the form on this page!


By Duncan Colvin, Senior Operations Consultant