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Restaurateurs: It pays to consider costs

“Everyone thinks it’s a novel idea to open a restaurant,” says Mary Nhin, owner of Nhinja Sushi and Wok, a multi-location, fresh casual concept in Oklahoma City. “And it is romantic, but success takes perseverance.” When Mary and Kang Nhin opened Nhinja, they were already experienced restaurant owners. “We knew to be prepared to spend more than our estimates, and we knew that controlling costs would be vital.” 

In the narrow-margin world of food service, how can you cut costs without clipping your customers? Here are a few questions to keep you on course. 

Who are you?

Know thyself. “The best thing we did was to define our mission and set specific goals,” says Nhin. “Then every decision in the future has a compass point.” At Nhinja, the focus is on making sushi more accessible to a mainstream audience. At other concepts, the focus should be similarly easy to define. Famous American chef Bobby Flay, speaking with Newsweek’s Jessica Ramriez, concurs. “If you can describe your cuisine in one word, like French, you’re on the right track,” Flay says.

Having a narrow focus keeps a restaurant from making the costly error of having an overly complex menu. It also makes decisions about inventory, staff and location easier, saving money in the long run.

What could happen?

In a word, anything. Day-to-day restaurant operation involves a lot of problem solving, so preplan and be ready to act. A restaurantengine.com article mentions the untimely problem of food delivery interruptions and the value of having a plan in place that involves multiple vendors. This way you’ll “have a person you can reach out to in a pinch if you need something quick when one vendor falls through.” This always-be-prepared mindset can also help when the ice machine breaks and two dozen bags are needed pronto, or if you offer delivery and there’s a sudden problem with the vehicle. It’s vital to have immediate funds handy, as well as a system for controlling and tracking those funds, like PEX.

How can your team help?

Inviting your team to take an active role in expense management can result in valuable, cost-cutting insights. In an Inc.com slideshow targeting restaurant owners, readers can note how Union Square Hospitality CEO Danny Meyer oversees a culture of “bottom-up leadership.” This includes allowing his chefs to make their own decisions and discoveries with regard to purchasing. Eventually, the whole organization can take advantage of savings.

Having an involved staff has been key to Nhinja’s success in cutting costs and keeping customers. At Nhinja, each location manages its own costs and expenses independently. “We oversee things, but allow for a degree of autonomy,” says Nhin. “It keeps our team responsible and focused on providing great service. And, in our niche…business is booming!”

When it comes to cutting costs, it’s wise to explore options that don’t include an immediate rush to trim portion sizes or raise prices. You need tools that provide for greater operational flexibility and efficiency. PEX can play a valuable role in your restaurant’s success when you need to give certain team members the ability to spend freely within specific expense categories, and you need a timesaving way to manage the process.

Schedule a one-on-one demo of the PEX platform today to learn about your options.

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