Cost-cutting strategies for the hospitality industry during the cost-of-living crisis

The current cost-of-living crisis is a huge challenge for the hospitality industry: energy bills and the price of ingredients are soaring, and budget-conscious consumers are cutting back on eating out. But fear not, there are clever ways to navigate these challenging times without compromising the quality of your service or the experience of your valued customers.

Become a Waste Warrior

• Leftovers with a Twist: Save money by embracing the “waste not, want not” spirit and creating a special “leftovers menu” featuring dishes made from surplus ingredients. This can attract budget-conscious and environmentally-aware customers seeking delicious deals.
• Portion Control is Key: If you find customers are often unable to finish the food on their plate, your portion sizes could be too big. Review this and, if necessary, adjust portion sizes to ensure you’re not unnecessarily wasting food. You could also consider offering ‘small plates’ or appetisers at lower price points for those on a budget.
• Get Crafty with Compost: Instead of throwing away food scraps, explore composting options. This reduces waste disposal costs and creates nutrient-rich fertiliser for potential in-house gardens or partnerships with local growers

Sharpen Your Procurement Pencil

• Embrace ‘Wonky’ Ingredients: Buy and use ‘wonky’ fruit and veg where you can - it usually works out cheaper. And instead of discarding slightly imperfect produce, get creative! Feature these ‘ugly ducklings’ on a budget-friendly ‘seconds menu’ or use them in staff meals.
• Renegotiate with Suppliers: Loyalty deserves a reward. Reach out to your suppliers and discuss potential price adjustments or extended payment terms based on your long standing partnership.
• Explore Local and Seasonal Options: Locally sourced ingredients often work out cheaper. As well as being better for the planet due to low transportation costs, it’s a good way to add a unique touch to your menu and entice the customers in.

Energy Efficiency - Small Changes, Big Impact

• Empower your staff: Train staff to turn off unnecessary equipment like lights, ovens, and displays when the business is closed.
• Embrace Natural Light: Make the most of daylight by strategically placing tables and maximising window usage. This can significantly reduce your reliance on artificial lighting during peak hours.
• Go romantic with candlelit dinners! Candles are not just for Valentine’s Day! You could consider switching off some lights once a week and using candles instead. The cosy atmosphere is certain to pull in the punters!
• Minimise Heat Loss: Unfortunately, many buildings in the UK have single-glazed windows. Whilst double-glazing is the gold-standard, it is a costly investment. Budget-friendly alternatives for keeping heat in include using blinds and curtains, having two sets of doors at the entrance and using draught-excluders. All of these methods really up the cosy factor, too!
• Smart Scheduling: Adjust heating and cooling schedules to align with peak business hours. There’s no point in heating an empty space!
• Invest Wisely: Consider upgrading to energy-efficient appliances over time. While there’s an initial cost, the long-term savings on energy bills can be substantial.

Technology: Your Cost-Saving Ally

• Scheduling Optimisation: Time is money! Using our rota scheduling software, AceRota, to quickly and efficiently create your rota, optimise wage costs and deal with payroll will allow you to use your precious time to get on with other things.
• Inventory Management Systems: Implement inventory management software to track stock levels, predict demand, and avoid over-ordering. This can significantly reduce food waste and free up cash flow that was previously tied up in unnecessary stock.
• Promote your business online: Use free social media platforms to reach out to local customers with targeted promotions and deals. This can be a cost-effective way to attract new customers and boost sales.

Building a Loyal Team

Remember, your staff is the heart of your hospitality business. During challenging times, employee morale and retention are critical. Hiring, inducting and training new staff is time-consuming and expensive. Consider some of the following to help create a positive work environment, improve morale and reduce employee turnover.

• Cross-Training Opportunities: Empower your team by providing cross-training, allowing them to fill in for different roles and reducing your reliance on hiring additional staff for specific tasks.
• Flexible Working Opportunities: Consider offering flexible working or work-sharing arrangements to support employees with caring responsibilities, or those with a second job.
• Staff Discounts: Think about offering reduced price, or even free, meals to staff. It won’t cost you much, but will go a long way to keeping your employees happy.

Implementing these cost-saving strategies, you can help ensure your business remains profitable while continuing to offer your customers exceptional service.