Cost Control Strategies in a Restaurant Business Essay
Every business has a lot of operational consideration. In order to survive, a business must be able to generate revenues enough to cover its operational costs and to deliver quality products and services to its customers. It is true sometimes that in order to deliver quality, the costs will be at times high. However, there cost controlling measures that will still keep the business financially stable as they deliver products and services to their consumer.
Restaurant businesses face the most rigid cost control measures. Aside from cooking good food, a restaurant manager must make sure that almost, if not, all of the dishes in the menu are available, have sufficient supply of ingredients and have good kitchen practices to avoid spoilage. Good food also means good ingredients, making sure that it is not expensive so that projected revenues will still be retained.
The game of cost control is a push and pull situation (Taylor, 2007). In order to achieve a certain objective, for example, to add more manpower in order to address customer needs, one must face the fact the additional salaries are going to be added on the operational expenses of the business. On the other hand, if a
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The initial situation given in the case is that sales have decreased due to the unemployment problem in the community. Here, the problem lies on the external part of the business which includes its customers. It can be assumed that the customers do not prefer to dine at the restaurant because of budget constraint. However, it is not the option of the restaurant to sub-standardize its main service, which is food, in order to accommodate the customers. One thing that the restaurant can do in order to respond to the challenge faced by its market is to offer affordable yet delicious food that can fit a customer’s budget. A way on how to know it is to have a survey on how much they would be willing to spend in dining at a particular restaurant. Having the numbers in mind, the restaurant can adjust to the needs of the market and as well as keeping the business earning.
However, once a business or organization is facing changes, it is inevitable that the whole structure should also adjust (Newstrom and Davis, 2002). A change in objectives and targets must also be trickled down to other factors that will have to adjust. First, if the restaurant would like to have this strategy on gearing to a more affordable service, the restaurant manager must restructure the operational guidelines and means so this objective will be achieved. Not only that, the operational guidelines on the restaurant business must also be followed diligently by the staff.
Spoilage is one of the problems being faced by most restaurants (Pavesic, 1999). It can be caused by a mistake while doing the food or the servings are too much for the customers. For every food wasted, it costs the restaurant and the customer as well. What needs to be achieved in the restaurant is standardization of operational guidelines from the recipe to the serving patterns of food. These guidelines will help ensure the quality and delivery of food in a restaurant.
Equally important is how to implement the guidelines to staff. There are employees who are averse of changes; however, organizational change can be overcome by reviewing to them the business objectives and their role to achieve those objectives (Robbins, 2002). If possible, a training program can be facilitated to the employees in order to advance their awareness and to make sure that they have the know-how in doing the guidelines.
Businesses face unfavorable situations and challenges. However, there are available measures for business to tackle these. If cost control and quality of work starts well within the business organization, it can withstand changes and issues and continue to have strong financial health to stay in business.
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Pavesic, David V. Cost Controls: Restaurant Manager’s Pocket Handbook Series. New York: Lebhar-Friedman Books, 1999.
Robbins, Stephen P.. Organizational Behavior (10th Edition). Alexandria, VA: Prentice Hall, 2002.
Taylor, James. Project Scheduling and Cost Control: Planning, Monitoring and Controlling the Baseline. 2004: J. Ross Publishing, 2007.