8 tips to keep your restaurant profitable

Welcome to restaurant managers who want to maximize the profitability of their establishment! In a sector as competitive as the restaurant business, it's essential to master the keys to financial success. That's why we've put together 7 essential tips to help you ensure your restaurant's prosperity. 

Whether you've been established for years or are just starting out, we'll guide you through innovative strategies, practical tips and fresh ideas for attracting more diners, optimizing your costs and boosting your profits. Don't let the financial stakes hold you back, be ready to propel your restaurant to new heights of profitability!

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Tip 1: Think carefully about your restaurant's concept

The first essential step to ensuring the profitability of your restaurant is to think carefully about its concept. The concept is the soul of your establishment, what sets it apart from others and attracts loyal customers. 

By developing a solid concept, you create a unique identity for your establishment. This means defining your culinary style, ambience, décor and even your service philosophy. Think about your target audience, their preferences and what motivates them to choose your restaurant over another.

To define your restaurant's concept, you need to consider several key elements.

Here are a few steps to guide you:

• Market research: Start by conducting an in-depth study of the foodservice market in your area. Analyze existing competition, identify emerging trends and understand consumer preferences. This will help you spot opportunities and untapped niches.
• Define your target audience: Identify the profile of your potential customers in terms of age, gender, income, food preferences, etc. Understand their needs, expectations and consumption habits. This will enable you to create a concept that specifically meets their needs.
• Find your unique positioning: Think about what differentiates you from other restaurants. What is your unique value proposition? What can you offer your customers that others can't? It could be your regional cuisine, an original theme, an ecological approach, a special ambiance, etc.
• Develop a coherent menu: Your menu must be in line with your concept. Think about the cuisine you want to offer, signature dishes, local or organic produce, vegetarian or vegan options, etc. Make sure your menu is attractive, balanced and in tune with the tastes of your target audience.
• Creating the right atmosphere and decor: Think about the atmosphere you want to create in your restaurant. Is it casual and friendly, upscale and refined, or something else? Choose a decor that matches your concept and will appeal to your customers. Colors, materials, lighting and furniture are all important elements to consider.
• Develop a visual identity: Create a logo, an attractive website, well-designed menus and other visual communication media that reflect the spirit of your restaurant. A strong visual identity helps reinforce brand recognition and attract the attention of your target audience.
• Test and adjust: Once your concept is in place, test it and gather feedback from your customers. Be open to suggestions and adjustments to constantly improve your offer.

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Tip 2: Evaluate and calculate your menu margin

Once you've given shape to your restaurant's vision, it's vital to evaluate and calculate your menu's profit margin. The profit margin is a key indicator of your establishment's profitability. Wise management of this margin will enable you to maximize profits and make sound pricing and cost decisions.

To evaluate the profit margin of your menu, several elements must be taken into account:

• Ingredient costs: It's essential to determine the cost of each ingredient used in your dishes. Take into account purchase prices, quantities required and any seasonal variations. Keep your supplier data up to date for accurate information.
• Indirect costs: Don't underestimate indirect costs such as rent, utilities, staff, kitchen supplies, marketing expenses, etc. These costs need to be spread evenly across your menu to get a complete picture of expenses incurred.
• Selling prices: Analyze the competition and assess market demand to set the selling prices of your dishes. It's essential to find the right balance between attracting diners with competitive prices and maintaining a satisfactory profit margin.

Once you've gathered this information, you can calculate the profit margin for each dish by subtracting the total costs of the dish from the selling price. Be sure to take into account any indirect costs that have been allocated appropriately.

👉 To go further: Margin and profitability in restaurants: understanding everything.

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Tip 3: Find the right suppliers

When it comes to guaranteeing a satisfactory profit margin, finding the right suppliers is of crucial importance. Suppliers play an essential role in the quality of the ingredients used in your dishes, as well as in controlling costs.

Here are a few tips to help you find the right suppliers and keep your profit margin at an optimum level:

• Go for quality: Choose suppliers with a reputation for quality. High-quality ingredients not only guarantee your customers' satisfaction, but also the creation of tasty, attractive dishes. 
• Negotiate prices: Don't underestimate the power of negotiation. When establishing relationships with suppliers, discuss prices and seek the best possible terms. 
• Consider reliability: Opt for reliable, punctual suppliers. It's essential to receive ingredients on time so you can prepare your dishes according to your schedule. Late deliveries or stock-outs can lead to disruptions in your operations, which can have a negative impact on your profit margin. Do your research, ask for references and choose suppliers you can rely on.
• Explore local options: Local suppliers can offer several advantages. Not only do you support the local economy, but you can also reduce transportation and logistics costs. 
• Stay on top of new trends: Innovative suppliers can offer you new ingredients and products that respond to current market trends. Staying on top of new food trends can help you attract customers and maintain your competitiveness. 

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Tip 4: Manage your stock

Effective inventory management is an essential element in maximizing your profitability. By adopting intelligent inventory management practices, you can reduce the costs associated with excess inventory or stock-outs, while optimizing your profit margin.

Here are a few tips to help you manage your stock:

• Analyze demand: Understand your guests' consumption habits and analyze sales data to anticipate demand. By knowing which dishes are the most popular and when they are the busiest, you'll be able to adjust your stock levels accordingly. This will help you avoid the costs associated with unsold perishables and the losses associated with missed sales.
• Adopt the just-in-time principle: The just-in-time principle consists of maintaining minimum stock levels while obtaining regular supplies from suppliers. This reduces storage costs and optimizes product rotation.
• Use an inventory management system: Invest in an inventory management software or system that will enable you to effectively monitor and control your stock levels. These tools will help you automate processes, forecast future needs and minimize ordering errors.
• Practice first-in, first-out (FIFO): For perishable products, use the first-in, first-out method to avoid losses due to expiry. Ensure that the oldest products are used first, to maintain the freshness and quality of ingredients.
• Establish relationships with reliable suppliers: Working closely with reliable suppliers can help you guarantee fast, regular delivery times. Good communication with your suppliers can enable you to adjust your orders quickly to variations in demand.
• Carry out regular inventories: Carry out frequent inventories to accurately assess your stock levels. This will help you identify any management errors, theft or losses, and take the necessary corrective action.

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Tip 5: Ensure a constant fill rate

Maintaining a constant occupancy rate is essential to maximize your revenues and ensure sustainable profitability for your establishment.

Here are a few tips to help you achieve this goal:

• Analyze booking trends: Study booking trends in your establishment to better understand peak and off-peak periods. This will enable you to adjust your capacity accordingly, increasing or reducing availability to maximize fill rates.
• Offer strategic promotions: Offer special deals or promotions to attract more customers during off-peak periods. For example, discounted menus, happy hours or special offers for groups can boost footfall and optimize your fill rate.
• Build customer loyalty: Set up an attractive loyalty program to keep your customers coming back for more. Offer special rewards, exclusive benefits or personalized offers to reinforce their attachment to your establishment.
• Use online booking platforms: Register your restaurant on popular online booking platforms to increase your visibility and facilitate bookings. This will enable you to optimize your online capacity with customer requests, avoiding empty tables or overbooking.
• Care for the guest experience: Offer your customers quality service and a memorable experience. Tasty food, attentive service and a pleasant atmosphere will keep your customers coming back and recommending your restaurant to others.
• Optimize the layout of your establishment: Make sure you use the space available in your restaurant efficiently. Analyze table layout, circulation areas and general layout to maximize your capacity without impacting guest comfort.

👉 To find out more: 7 tips for quality customer service in the restaurant business

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Tip 6: Train your staff

Training your staff is an essential part of delivering an exceptional customer experience and maintaining your restaurant's reputation.

Here are a few tips to help you train your staff effectively:

• Set high standards: Define high service standards and communicate them clearly to your team. These should include aspects such as friendliness, speed, product knowledge and problem-solving. Ensure that every member of your staff understands the importance of providing superior service to every customer.
• Organize regular training sessions: Plan regular training sessions to improve your team's skills. This can include hands-on demonstrations, updates on new dishes or training sessions on communicating with guests. 
• Train your team to handle tricky situations: Difficult situations can arise in a restaurant, whether it's disgruntled customers, service problems or ordering errors. Train your staff to deal with these situations calmly, professionally and courteously. 
• Promote product knowledge: Train your team on the details of the dishes, beverages and ingredients on offer. The more they know about the products, the better they'll be able to advise customers, answer their questions and create a pleasant dining experience. Set up recipe cards too.
• Cultivate a team spirit: Encourage collaboration and mutual support among your team members. A positive work environment fosters staff motivation and commitment, which translates into better customer service.

👉 Further information: Restaurant training and everything you need to know

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Tip 7: Setting up a dashboard

Setting up a dashboard is essential to effectively monitor your restaurant's performance and make informed decisions. Here's how to create an effective dashboard:

• Identify key performance indicators (KPIs ): Determine the main indicators that measure your restaurant's success. This can include figures such as sales, reservation rates, raw material costs, customer satisfaction rates, etc.
• Use the right tracking tools: Use digital tools such as restaurant management software or spreadsheets to create your dashboard. These tools will enable you to easily compile and analyze data, making it easier to track your performance.
• Update your data regularly: Be sure to update your data on a regular basis for accurate, up-to-date information. 
• Visualize your data clearly: Use graphs, tables and other visual elements to make your data easy to understand and interpret.
• Analyze your results: Take the time to analyze the data on your dashboard to identify areas where improvements can be made. For example, if you see a drop in the reservation rate, you can adjust your marketing strategies to attract more guests.
• Set goals and track your progress: Set clear goals for your restaurant and track your progress against them regularly. 
• Share information with your team: Involve your team in performance monitoring by sharing relevant information from your dashboard. This will enable everyone to understand the objectives and contribute to continuous improvement.

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Tip 8: Put digital to work for you

To increase your restaurant's profitability, it's essential to put digital technology to work for you. 

One key strategy is to multiply the ordering channels available to your customers. By offering an online ordering option, for example, you benefit from increased visibility and business, which translates into higher revenues. And collaborating with popular delivery services such as Uber Eats and Deliveroo enables you to reach a wider audience and meet the growing demand for home delivery.

"I make €15,000 a month in sales on average simply with delivery." Damien Pugeault, BCHEF franchisee in Vannes

KDS play a crucial role in improving your restaurant's productivity. These digital tools enable you to efficiently manage order flow, minimize errors and speed up the meal preparation process. Thanks to better coordination and optimized communication, you can reduce waiting times, increase customer satisfaction and, consequently, boost your revenues.

And last but not least, to optimize your restaurant's operation, you can install ordering kiosks. These interactive devices allow customers to place their orders directly, reducing queues and freeing up time for your teams. As a result, your staff can concentrate on other essential tasks, such as food preparation and customer service, improving the overall efficiency of your establishment. What's more, order kiosks can also increase the average basket by 25-30% compared with taking orders at the cash register.

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Are you a restaurant owner? Do you want to increase your profitability? Contact an expert and find out how to boost your sales, increase your profitability and improve your productivity.