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3 Business-Saving Tips For Restaurant Owners

Posted by Donald Burns on 8/7/17 8:00 PM in Restaurant Management

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tips for restaurant owners

Remember the movie "Moneyball" with Brad Pitt?

The film is based on the book by Michael L. Lewis and tells the story of how the Oakland A's Major League Baseball team built a world class troupe of players by looking at how they recruited and drafted.

Restaurants can also increase financial performance if they look outside the standard metrics to see their business from a new viewpoint. When you change the way you look at your restaurant, your restaurant will change.

Here are a few "Moneyball" ideas that can help you go past your normal restaurant KPIs (Key Performance Indicators) and into the land of more profits.

Tip #1: Turnover Comes From Disengagement 

Turnover costs your restaurant more than you realize.

But because it's hard to see some of the damage and expenses that occur, it's not always easy to connect those dots.

Let's start with an important question: do you track your turnover rate? You should. If you don't, you may not realize the severity of the problem until it's too late. And the root of the problem? Disengagement.

New Call-to-actionBack when you first hired a new employee, there was a certain level of excitement on both sides. You were excited to add someone who could be of value to your brand. He or she was looking for an opportunity to be a part of that.

Six months down the road and it seems the honeymoon is over. What happened? They became disengaged.

In order to stop this from happening, you'll need to become a team engagement detective! When you see these warning signs, you have two options:

  1. You can do something to turn it around.
  2. You can ignore it.

If you want to slow down your restaurant turnover rate, you'd better take action. Remember that if you don't make a decision, one often will be made for you. Below is a list of possible red flags.

Signs of Employee Disengagement

  • Late punches or clock-ins. 
  • Frequently calling in sick.
  • Asking others to cover their shift. 
  • Consistently making the same mistakes.
  • Not following the rules or standards.
  • Sloppy appearance.
  • Lack of personal hygiene.
  • Constantly asking to be the first to be cut (clock strikes 3 and they're out).
  • Decreased productivity. 
  • Social disconnect (they unfriended the restaurant or you on social media).
  • Increased negativity/complaining. 
  • Lack of initiative. 
  • Lack of focus. 

Now, don't freak out if - at times - members of your team show these warning signs. Everyone has moments where they will be disengaged at work. Everyone.

Detecting Disengagement

There will be times when people are late due to unforeseen circumstances or have a personal problem that spills over into work. Does that mean you should sit down and "have a talk" when the next person clocks in late? Of course not. What you want to start doing is tracking trends.

This is where a manager’s logbook or even keeping notes on your phone will help you become a bloodhound to sniff out those that seem to be stuck in disengagement mode for too long.

To avoid disengagement, talk to your team more often and be sincere. The key is to ask better quality questions besides the standard, "How's everything?" When you ask generic questions you get generic answers. Stop that. 

Deterring Disengagement

Create a Personal Development Plan for everyone on your team. This plan should be created side by side with the team member and the focus needs to be on them. It should at the least include:

  • Goals for the next 30 days
  • 6-month vision
  • 1-year vision 
  • 3-year vision

Your goal as the leader is to help them make an action plan and hold them to it. Your duty is to also be their coach, and coaching means holding people accountable to get the results they desire. 

Tip #2: Recipe Cards Are Great... If They're Real

You might have been meticulous about creating (and costing) out every menu item and recipe in your restaurant - as you should be! Not knowing your costs would be like driving across country with a broken gas gauge. Adventurous? Yes. Smart? Not so much. 

The problems come when the ideal world (recipe costing) collides with the real world (what the cooks actually do). When there are no checks and balances in place, things tend to get off track. That is why you want to adopt a philosophy of "inspect what you expect."

food-cost-calculator

Now, before you jump on the "I don't want to micromanage my team" bandwagon, understand this: your team wants to be acknowledged for the work they do. If you give them a checklist and just leave them to follow it, you are setting yourself up for disappointment.

So, you need to regularly spot check your team to ensure that what is on the recipe card is exactly what they are really doing in the kitchen (and the bar). People tend to abandon restrictions when they have no feedback and leadership. Cooks and bartenders like to tweak recipes for their personal tastes. That is a surefire way to see profits slip away. 

How to Conduct Spot Checks

When you are spot checking the team, ensure you:

  • Use a scale to measure the items that they are just "eyeballing."
    • One tablespoon of butter can quickly become 3 or 4 if the team is not kept in check.
    • A jigger of vodka become two when you measure out the "drag pour" the bartender has a tendency to do. 
  • Make sure the team has the proper cooking and measuring equipment. If they don't have the rightly-sized "disher or scoop," they tend to just grab the next size, and that could be a problem.
  • If they have checklists, make sure to spot check the lists and give training (feedback) when the standard is below par and always give praise when they have exceeded the standard.
  • Go over and retrain the standards if there are issues.
  • Do not give praise for just meeting the standard! That is setting your restaurant up to accept mediocrity. 

If your restaurant is struggling to get close to your theoretical food cost number, the likely food cost assassin that is roaming your kitchen and bar is inconsistency in the execution of recipes.

Tip #3: Track Guest Check Average

Your restaurant needs sales to be successful, so making sure your guest check average is where it needs to be is critical to monitor.

Many restaurants track Guest Check Average (GCA). However, they go about it like a normal stat and just look at the total. If you want to "Moneyball" this area, you'll have to dig deeper and look at the real areas that show what is going on between the lines. Then, make a plan to teach, train, and coach your team.

You also need to look at these sales categories as well. Guest check average and amount sold are two different things entirely, so it's time to put on your menu engineering boots and get to work. Analyze each of the following in detail:

  • Appetizers sold
  • Entrees sold
  • Desserts sold
  • Bottles of wine sold
  • Mixed or specialty drinks sold
  • Average table turn time 

Look for the areas where there is an opportunity for selling. You might notice a gap in wine by the bottle sales and then when you ask the server, you find out that they are not comfortable selling wine by the bottle because they are not comfortable opening wine at the table. Sometimes you have to look at things differently to get the real sense of what is going on. Find the gaps, and then train on how to fill those gaps.

Conclusion: Tips For Restaurant Owners

Saving money in your restaurant sometimes requires you to look at systems, process, and data a little differently than what you’re used to.

If you are not getting the results you want, then it’s time to rethink your approach to solutions to common problems. Remember that the true definition of insanity is doing the same thing over and over, while expecting different results.

You have the power to stop the insanity in your restaurant. You just need to take action.

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Written by: Donald Burns

Donald Burns, The Restaurant Coach™ is the leading authority, author and international coach on how restaurant owners, operators and culinary professionals go from just good to becoming exceptional. He helps independent operators create organizations that thrive and bring out their workers' natural strengths to reach their peak potential. A sought-after advisor in the areas of menu design & engineering, restaurant operations, rebranding, social media marketing, culinary consulting, team development, behavioral dynamics, productivity & peak performance.


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