From Chaos to Control: Smart and Easy Restaurant Management Tips 

Running a restaurant is a constant juggling act. You're not just serving up delicious meals but also managing a truckload of responsibilities. From keeping track of inventory and controlling food costs to dealing with staff turnover and staying ahead of changing customer preferences, the challenges can sometimes feel endless. And one misstep can quickly turn a good day into a chaotic one!

But here's the good news: with the right strategies and tools, you can turn these challenges into opportunities for growth. Whether you're a seasoned restaurateur or just starting, this blog post is packed with practical tips to help you streamline operations, boost profitability, and create memorable dining experiences. 

Some Common Challenges Restaurants Face

Before we discuss some of the key processes and strategies of restaurant management, let's examine the common hurdles. Here's what you need to watch out for!

1. Attracting and retaining quality staff

Behind every successful restaurant is a team of skilled and dedicated staff. However, finding and retaining good staff has become increasingly difficult. To tackle this, restaurateurs must create a supportive and collaborative work environment, offer competitive pay, and invest in growth-oriented training programs. 

2. Managing rising food costs and pricing menus

Rising food costs are one of the biggest hurdles. While cutting corners might seem like a quick fix, it can compromise food quality and your reputation. Instead, innovative menu pricing can help you stay profitable without sacrificing quality. 

3. Ensuring food safety and sanitation

Restaurant operations are often prone to storage, food preparation, or transportation accidents, leading to customer complaints and costly lawsuits. Cross-contamination risks and pest control issues add complexity. In addition, restaurant operators must adhere to local health codes, FDA guidelines, and HACCP principles.  

However, implementing innovative technologies like automated cleaning systems, AI-powered sensors, and even CASPR systems for sanitation can help maintain your kitchen's cleanliness and food quality. 

4. Adapting to customer preferences and market trends

The culinary industry constantly evolves, and restaurants that fail to adapt lose revenue. They can also face a declining customer base, reputational damage, and increased competition pressure. 

There's also a fine line between adapting and staying true to their brand identity without following trends. Tackling this starts with conducting market research on customer preferences, providing alternative menu options, incorporating new cooking techniques, and offering online ordering services. 

5. Optimal asset and inventory management 

Lack of proper inventory management and equipment can lead to food waste, increased costs, forced menu changes, and even theft. 

To maintain accuracy, use the FIFO method for perishables to minimize waste and regular inventory counts during off-peak hours. A centralized management system that tracks maintenance tasks and scheduled cleanings can also help. 

Here are a few key processes involved in quality restaurant management to clear these challenges. 

Key Processes Involved in Restaurant Management 

To understand more about how to manage a restaurant efficiently, let's start by understanding the key processes involved in restaurant operations: 

• Daily operations: Involves maintaining ambiance, handling kitchen equipment, food prep, managing deliveries, and ensuring employees follow health and safety standards. Supply chain management activities such as demand forecasting, procurement of ingredients, and supplier relationships are also key aspects.
• Staffing & scheduling: Involves core staffing activities like hiring, training, re-staffing employees, balancing their needs and schedules, and paying fair compensation
• Inventory management: Involves monitoring and maintaining food and beverage stock levels to ensure they are fresh and adequate.
• Customer service: Involves interacting with guests, solving customer complaints, ensuring service is on point, and performing customer retention practices.
• Accounting and Finance: This field involves key financial activities such as recording all transactions (sales, expenses, inventory, payroll) and preparing financial statements. It also includes monitoring metrics like food cost percentage, labor cost percentage, and average revenue per customer, developing budgets, and complying with relevant tax regulations.
• Marketing and advertising: This entails marketing efforts to achieve optimal restaurant capacity. Core marketing activities include social media marketing, review management, collaborations, event management, partnership building, loyalty programs, and search engine optimization. 

Each of these processes is interconnected, and any challenges faced might impact other aspects of restaurant management. However, there are many ways to solve them.

5 Best Practices for Restaurant Management 

Now that you know about the key processes in restaurant management and the challenges associated with them, it's time to dive into some of the best practices for restaurant management that can help tackle them:

1. Conduct Frequent Menu Engineering to Enhance Profitability

Menu engineering is a systematic process where you: 

• Identify the most popular items on your menu
• Determine how much each item contributes to revenue
• Optimize their prices based on their popularity and revenue generation 
• Position them strategically to attract customers 

If you're wondering how to go about this process, you can start categorizing menu items under the following categories:

• Stars: High profit, high popularity
• Plow-horses: Low profit, low popularity
• Puzzles: High profit, low popularity
• Dogs: Low profit, low popularity

When you classify menu items in this manner, you'll have a good idea of what dishes you wish to retain or eliminate and how to price them. 

For example, to attract customers' attention, you can strategically place your star items in certain menu areas, like the Golden Triangle (top-center, top-right, and middle sections). You can also popularize puzzle dishes by lowering their prices. 

Some best menu design techniques: 

• Choose a timeframe to redesign and shuffle items in your menu
• To measure dish profitability and popularity, estimate metrics such as food cost percentage, contribution margin, sales, etc..
• Classify them under each menu engineering category
• Get feedback from trusted customers 

But RestoLabs takes this process a step further. It offers a simple-to-use menu configuration dashboard that lets you quickly add, modify, and delete menu items in real time, enabling easy menu and combo creation.

2. Implement the Right Food Cost Controls.

Food costs are one of the most important costs you need to track, as they help you price your menu accordingly and remain profitable. Here are a few actionable tips you can follow:

Track your food costs. This involves calculating the cost of ingredients and inventory and comparing it to your revenue. 

Your food cost percentage helps you measure efficiency. It shows how much of your revenue goes toward buying the food you serve. 

To calculate it, you first need to figure out your Cost of Goods Sold (COGS).

Is 55% Good? Not really. Most restaurants aim for a food cost percentage between 25% and 35%.

A higher percentage could mean:

• You’re overspending on ingredients

• There's waste or spoilage happening

• Portion sizes might be too large

• Your menu pricing needs a review.

Track prices of seasonal ingredients: The cost of ingredients keeps changing, so you must keep track of them and update your menu items to factor in these changes. This way, you control costs effectively and do not lose money in the process. 

Use an inventory management tool: You can consistently implement tools to optimize stock levels. They can help track inventory, maximize menu items and stock levels in real time. It gives you control over costs, increases profitability and minimizes waste.

3. Implement Labor Cost Controls

Like food, labor costs also represent a significant portion of your overall restaurant costs, including wages, salaries, taxes, and other monetary benefits your employees receive. Here are essential tips for managing this:

Tracking your labor cost percentage: This is directly linked to your profitability, so by tracking this metric, you can ensure efficient staffing levels, control payroll expenses, and maintain the financial health of your restaurant. Here's how you do it:

• Step 1: Calculate total sales
• Step 2: Calculate total labor costs
• Step 3: Divide total labor costs by total sales and multiply the result by 100 to get your labor cost percentage

‍Pro Tip💡: Most restaurants aim for labor costs between 25%–35% of sales. Going beyond this range could indicate overstaffing or inefficiencies

Invest in the right employee scheduling tool: Employee scheduling tools like Deputy, Homebase, and Planday help you create optimal shift schedules within short periods that can save you about 1-3% in labor costs. 

Cut operating hours: Reducing employees' work hours during days with minimal business is advisable. This can be done by analyzing peak hours, implementing streamlined menus with faster prep times, and even training staff on quick service techniques.  

4. Build Strong Customer Relationship Management Techniques

Building strong customer relationships can enhance loyalty and drive repeat business, making it one of the best restaurant operations tips. And this begins when you cultivate a welcoming environment for all your customers. Following that, your next steps are to:

• Personalize experiences by recognizing regular customers and remembering their preferences 
• Actively engaging with customers through surveys and social media. Using customer feedback to make improvements also shows that you value their input
• Resolve customer complaints quickly to boost satisfaction and maintain a positive reputation

Pro tip💡: Implement a robust CRM tool like RestoLabs with features like reward programs, coupon builders, and real-time push notifications that keep you connected with your customers, driving repeat business and helping you build lasting relationships.  

5. Provide Comprehensive Staff Training

Did you know 59% of staff have improved job performance after proper training? A well-trained staff can lead to smoother operations when workflows are coordinated and customers are better served. Here are some useful insights:

• Start by creating a well-structured training program that covers all aspects of restaurant operations.
• Use hands-on training protocols for recruits to show them how to handle ingredients, prepare dishes, and maintain kitchen equipment.
• Incorporate role-playing when practicing serving customers.
• Cross-training employees can also reduce disruptions and enhance workplace collaboration. Examples include training kitchen staff to handle customer service or training wait staff to bartend.

Elevate Restaurant Management with RestoLabs

To cap it off, mastering restaurant management is about achieving efficiency in restaurant operations and taking customer engagement to new heights. From frequent menu engineering and tracking your food and labor costs to comprehensive employee training, these restaurant management tips can help you take your business to the next level. But why not make it easier with advanced tools like RestoLabs?

With RestoLabs' online ordering system, you can streamline ordering processes, reduce wait times, and enhance customer convenience. With easy-to-use integrations and a comprehensive dashboard to manage orders, menu, and delivery, restaurant management has never been simpler. It can also help with order management, staffing, and marketing oversight—all of which scream restaurant success!

Furthermore, you can incentivize your customers to be your #1 fan with reward programs and coupons. Curious to know more about these? Book a demo with us today!