Save Money as a Restaurant Owner: Top 101 Tips

Introduction

If you want to see the money saving tips for restaurant owners, then you’ll LOVE this (updated) guide.

I’ve personally talked to restaurant owners and gathered insights from communities to create a list of 101 easy ways to save money.

And you can filter through the list to find the best ways to save money for you.

Let’s dive right in!

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Staffing

1. Be Transparent with Employees

Being transparent with your employees about the fact that you’re trying to save money can be more effective than you think.

Asking your employees what they can do to save money can also boost their emotional investment in your business.

2. Hire a Robot

Hiring a robot can help you save money in multiple ways.

A bartending robot, like ours, can virtually eliminate over-pouring. Our serving robots can help you operate in a more lean capacity.

"A team of two robots from Richtech Robotics fills in for roughly three human workers.”

I break down all the benefits of hiring a robotic worker in my blog post: The Definitive Guide to Hiring a Robot Worker in the 2022 Labor Shortage

3. Train your Staff to Upsell

This is a common business tactic that many restaurants use to increase product margins.

You can start to plan for this in your hiring process, by asking potential employees about their experience with upselling.

4. Motivate your Staff

Motivating your staff on a consistent basis can strongly impact multiple aspects of your business.

Employees will be more willing to provide a higher level of customer service and be productive throughout the day.

5. Recruit Internally

Studies have shown that employees working at companies with a high internal hiring rate stay at their job 41% longer than employees working at companies with a low internal hiring rate.

Adopting this practice will lead to an increase in employee retention, which will save money on hiring costs.

6. Take the Time to Give Staff Thorough Training

Having a comprehensive training program for new employees is essential in today’s workforce.

According to the 2020 Linkedin Global Talent Trends Report, companies rated highly on employee training say 53% lower attrition.

7. Invest in Employee Retention

Most business owners know that retaining employees can help you save money over time, as hiring and training new employees can be quite expensive.

One strategy to help with employee retention is to encourage employees to give feedback.

A recent Tinypulse study on employee retention found that there was a 16% decrease in retention rates for employees who aren’t comfortable giving upward feedback.

8. Cross Train Your Staff

Unless your restaurant is entirely run by robots, call outs are unavoidable.

You can prepare for this by cross-training your restaurant staff to fill in as needed. This way, if you lose a vital part of your operation, it won’t end up costing you.

9. Come up with Documented Processes

Not having documented processes in place for various aspects of a restaurant's operations is a recipe for inconsistent and wasteful production.

Taking the time to establish well documented SOPs  will lead to a safer and more efficient workforce, and it will also make your staff's jobs easier to perform.

10. Post Jobs Locally and on Social Media

Posting job listings on websites like Indeed can be effective, but also cost money.

Posting your job openings on social media and free sites like craigslist can help you cut down on unnecessary expenditures.

11. Hire Part Time Staff

Hiring part time employees saves you the cost of paying out salaries and employee benefits.

It also allows for more flexibility when it comes to scheduling. Try not to schedule too inconsistently, however, or it may be hard to retain employees.

12. Hire Interns

A classic money-saving technique, hiring interns can help you accomplish your goals for less.

Whether it be hiring culinary interns, marketing interns, or business interns, there is a pool of talented and driven professionals looking to provide value through an internship.

13. Invest in Cameras

Did you know that 75% of employees have stolen at least once from their employers?

Installing cameras in your business can help you catch potential thievery, or at the very least, decrease the desire to steal from your establishment.

14. Cut Back Your Work Week

Do you have days or hours in the week where you’re not turning a profit? You might want to consider closing during those times to save money.

Doing this may even increase the profit margin of your new operation hours, as guests who used to visit during unprofitable hours will adjust to your new schedule.

15. Consider Moving from Tips to Hourly

Moving over from a minimum wage + tips based pay structure to a flat hourly rate structure has helped some restaurants save money in the long run.

This also created a more reliable source of income for employees, leading to less turnover.

16. Observe the First and Last 15-30min of Each Shift

Parkinson’s law states that “work expands so as to fill the time available for its completion.” To see if this applies to your business, take some time to observe the first and last 15-30 minutes of each shift.

If there’s a noticeable shift in tempo, it might be time to reduce the total length of an employee’s work shift.

17. Cut your Pay and that of Highly Paid Employees

This is one of the easiest ways to save money on your business.

If you’re able to cut your own pay to help your struggling business, then you might want to do so. If you can’t consider cutting the paychecks employees with bloated salaries.

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Food

18. Use a Scale

If you aren’t already, you should definitely be using a scale in your food preparation process.

Not only will this help you save money by getting the most out of your inventory, you will also be ensuring a consistent product for your customers.

19. Reduce Portions

One way to save money during food preparation is to reduce the portion size that you are serving. Even the smallest change in portion size can have a massive effect on the profit margins of your menu.

Data resoundingly shows that Americans are being served overly-large portions anyways, so trimming down portions will benefit the health of your guests.

20. Use Smaller Plates

If you’re going to reduce portions, you may want to consider also reducing the size of the plates you’re serving food on.

This will help guests feel as if they are still getting a relatively large portion compared to the size of their plate, so they might not even notice that they’re being served less for the same menu price.

21. Reduce Free Offerings

Does your restaurant provide chips, bread, or other free items during service?

If so, an easy way to save money is to reduce the amount of these offerings, or completely eliminate them.

You can even take this a step further by asking guests if they would like a soda, wine, or other money-making beverage before you give them water.

22. Revisit Menu

Trimming the fat on your menu is something that must be considered on a regular basis.

Whether your menu is consistent year round or changes throughout the year, it’s important to be analyzing food and items for performance.

The last thing your business needs is food spoilage from a menu item that doesn’t sell.

23. Tweak Recipes Seasonally

Veggies and fruits tend to cost less when they’re in season, so tweaking your recipes to be in line with what ingredients are growing well can save you costs on ingredients.

24. Focus on Selling your Highest Gross Profit Menu Items

Most restaurants have a few items on their menu that are far more profitable than others.

You can focus on these items by upselling them, drawing attention to them with menu design, and marketing them. More purchases of higher profit items will lead to an overall higher profit margin.

25. Look into Ingredient Substitutions

The market for ingredients is always changing, so it’s a good idea to monitor it for potentially cheaper substitutions, when possible. Just make sure that your recipe modifications are received well b your guests!

26. Repurpose Food Trimmings

Food waste is a huge problem in America, with anywhere from 4% to 10% of the food purchased by restaurant leaders never reaching the customer.

Many food trimmings can be repurposed to supplement or replace ingredients in other foods. Salmon belly meat, which usually gets discarded, can be used for other dishes like salmon bowls, omelets, breakfast bowls, salad, or croquettes.

By repurposing food that normally gets discarded, you’re not only making the most of your food costs, you’re also helping to reduce food waste.

27. Reduce Garnish Sizes/Amounts

Garnishes are a great visual embellishment to any food dish, but are best when used sparingly.

Reducing the amount of garnish size you dress items with can save money on ingredients, as you won’t need to buy and replace your garnishes as frequently.

28. Switch to High-Oleic Cooking Oil

Switching to high-oleic cooking oil helps save money because it has a longer fry life than other cooking oils, meaning you wouldn’t have to switch the fry oil out as often, allowing you to buy oil less often.

29. Optimize your Beer Kegs to Reduce Waste

Improper amounts of foam in your beer pours can lead to wasted product while pouring and unhappy customers.

Making sure that your keg is kept at the right temperature, your beer lines are being cleaned, and your keg pressure is at the right pressure can prevent foam waste and save you money.

30. Limit Access to Inventory

Instead of allowing your entire kitchen staff access, limit the number to 2-3 trusted employees. You will have more control over your inventory, you can prevent theft, and you can reduce inventory errors.

31. Remove Garbage Cans from the Kitchen

Here’s a fact that might surprise you:

According to a recent report, a half a pound of food is wasted per meal in restaurants. When restaurants waste food, they waste money too.

You can address this problem during food prep, by replacing the garbage cans in the kitchen with clear plastic containers to dispose of prep waste in. This way, you can review the containers after the food prep shift, and monitor the amount of food that is unjustly wasted.

32. Bulk Dispensers

Instead of giving out individually wrapped condiments, consider accommodating your guests with bulk dispensers. Most often, buying items like ketchup, salt, etc in bulk is more cost effective than buying individually wrapped goods.

33. Innovative To-Go Items

Across the US, restaurants are turning to creative ways to serve their customers. One unique way that restaurants are serving customers is by offering DIY to-go kits. These kits are made of to-go ingredients that can be used to make your fan favorite items at home.

As more people are working from home, this is a fantastic way to increase your offering. Plus, you can use custom paper bags for these items to help spread awareness for your brand!

34. Start a Waste Log

Starting a waste log can help you keep track of exactly where inventory waste is occurring in the day-to-day operation of your restaurant.

You can evaluate the log to find any potential unnecessary waste, and adjust accordingly.

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Marketing

35. Encourage Customers to Spread the Word

Simply asking your customers to spread the word about your restaurant can be more impactful than you think.

Most customers would spread the word about your business if they thought about it, so putting it in their mind through signage or simply asking them to spread the word is definitely worth it.

36. Post on Social Media

Posting on social media to spread your brand awareness and gain new customers isn’t just a good idea anymore, it’s a necessity.

36 percent of U.S. diners follow restaurants on social media, and 39% of that group mainly do so to help determine if they want to dine in or order food from the restaurant.

If you’re not reaching your audience on social media, your competitors are.

37. Set up your Yelp, Google MyBusiness, etc.

As a restaurant owner, you can set up your Yelp profile, Google MyBusiness profile, and any other online directory to increase your presence on Google Maps, search engines, and more!

A survey by Toast found Google reviews (46%) was the most popular place for diners to check restaurant ratings online, more popular than Yelp (23%), TripAdvisor (9%) and OpenTable (6%).

Most of the big directories offer this service for free, so you should definitely take advantage of it.

38. Start Working on SEO

SEO (Search Engine Optimization) is another proven marketing strategy that is completely free to execute.

Many free SEO tools exist online and can help your business rank higher on Google.

The key to winning at SEO is to have a blog that knocks your competitor’s blog out of the water. So if you’re a decent writer, you should definitely look into SEO. If you’re not, try it out anyways!

39. Free Advertising Credits

Advertisers such as Google ads, Facebook, Bing, etc. offer free advertising credits your restaurant can take advantage of.

Utilizing these ad credits is a great way to expand your brand reach without investing a ton of money up front.

40. Build your Email List

Using email marketing is cost-effective and one of the best ways to reach customers.

Providing an opt-in form on your website, giving customers a link to refer friends, and reaching out to your family and friends are some great ways to build your email list.

Once you’ve built your list, you can promote to your audience daily, weekly, or however often you choose.

41. Set up a Loyalty Program

Loyalty programs are great for customer retention.

One study found that 75% of customers said they would switch brands for a better loyalty program.

In the long-term, loyal customers will bring their family and friends to your restaurant and reduce your cost on acquisition marketing.

42. Free Marketing Softwares

Marketing is a vital part of attracting customers in the restaurant business. The more customers restaurants can attract, the more likely they are to raise their profits.

Too many restaurant owners don’t prioritize marketing as a channel to put their energy into, and if they aren’t, their competitors are.

Here are some free marketing softwares that you can use to attract more customers to your small business.

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Restaurant Operation

43. Lights Out Policy

Training your workers to turn off lights when they’re not using them can save you money on your utility bill.

Additionally, you can put a sign in the bathroom asking customers to turn off the light once they’re done to save more money.

44. Only Run a Full Dishwasher

If you run your dishwasher when it’s half full or mostly full, you’re wasting water and risking breaking dishes as they can move around more.

Only running the dishwasher when it’s completely full will reduce your water costs, saving you money.

45. Soak Dishes

Soaking your dishes in the sink before scrubbing them down is a simple but effective way to lower your water usage. Most people know about this tip, but are you implementing it?

46. Take Inventory Daily

Taking inventory of high-cost items everyday can help save money, as you know exactly what’s left in your kitchen, what’s gone to waste, and what’s leftover.

By monitoring all of this information, you can make sure no unnecessary food is going to waste and ensure the food you’re choosing is being used and generating revenue.

47. No Deliveries During Rush Hour Policy

Deliveries during rush hour are a recipe for disaster.

When your mind is focused on other things, it can easily be taken advantage of.

Putting a policy in place that will not allow for deliveries during rush hour will help you ensure that all deliveries are accurate and consistent.

48. Recycle and Reuse

From ink cartridges to hand towels and everything in between, there are so many opportunities to recycle and reuse items that are vital to a restaurant’s operation.

Conducting an in depth of every item in your restaurant to determine the viability of switching to reusable/recyclable items will save you money and help save the environment over time.

49. Use Scratch Paper

Did you know that Approximately 1 billion trees worth of paper are thrown away every year in the U.S?

Wasting paper isn’t just bad for the environment, it also negatively impacts your bottom line.

Simply repurposing documents as scratch paper to take notes on can make a bigger impact than you would imagine!

50. Invest in Glassware and Silverware

Are you buying disposable plates and plate wear on a consistent basis?

By choosing to invest in silverware, you are eliminating that expense, as well as reducing your impact on the environment.

Just make sure to put in measures to ensure that silverware isn’t accidentally disposed of.

51. Use Flatware Retrievers on Trash Cans

Investing in silverware can be a great way to save money, but can backfire quickly if silverware is accidentally ending up in the garbage.

Luckily, devices like flatware retrievers exist to help bussers separate food waste from tableware. If you use silverware, you should definitely consider these devices to help save you money.

52. Ask Customers if they Need To-Go Ware

Instead of automatically handing out to-go ware with every order, try asking customers if they would like utensils when they place their order.

Many to-go orders are consumed at home, where customers don't have a need for to-go ware.

53. Ditch the Landline

In 2022, having a landline is an unnecessary expense.

You can easily use a VOIP or Google Voice to lower your overhead costs, while still providing your customers with a way to call you.

54. Go for Digital Receipts

If you haven’t already made the switch, consider switching to digital receipts only.

You’ll be hard pressed to find a customer without an email or phone number, and you can attribute this change to helping lower your impact on the environment.

55. Revisit your Restaurant Layout

Many restaurant owners ignore the importance of a restaurant layout.

Designing the most efficient layout possible is incredibly important, and something that shouldn’t be overlooked.

Optimizing your layout can decrease ticket times, accidents, and promote customer satisfaction, which will all raise your bottom line.

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Appliances & Equipment

56. Energy Efficient Light Bulbs

Using energy-efficient light bulbs can save you as much as $22 per bulb. These kinds of saving strategies really matter when the budget is tight, so I highly recommend making the switch.

57. Low Flow Faucets and Toilets

Low flow faucets restrict the amount of water that comes out, allowing you to not use more than needed, ultimately saving you money on water costs. Low flow toilets act the same way, letting you use less water per flush, and less water overall.

Lower that water bill & enjoy savings!

58. Install Hand Dryers

Hand dryers are a more environmentally friendly, hygienic, and cost effective alternative to paper towel dispensers.

Although installing them requires an up front investment, the savings from not ordering anymore paper towels will return your investment and more!

59. Use Programmable Thermostats

Switching to a programmable can help keep your energy bills low, or at the very least keep them consistent.

60. Install Motion Sensor Lights

In many cases, installing motion activated lights in your restaurant can help lower your overall energy usage. This will help lower your overhead, while also lessening your impact on the environment.

61. Use Powerstrips to Unplug Appliances

Did you know that up to 75% percent of electricity consumption by appliances occurs while the item is turned off?

One easy way to fix this, according to business owner Steve Hatmaker, is to plug your appliances into power strips that are easily accessible and turn them off when you leave for the day.

62. Invest in Quality Appliances

Although quality restaurant equipment is usually more expensive, it can end up saving you money over the long term.

Investing in reliable, highly rated, and well constructed restaurant equipment is essential for a smooth operation.

63. Monitor for Leaks

Monitoring for leaks in your restaurant is essential to protect your customers, staff, and even your wallet. If it’s been a while since you checked for leaks, you might want to start including it into your routine.

64. Energy Efficient Appliances

Did you know that food service venues consume energy at more than twice the rate of other commercial businesses?

Replacing your appliances with their energy efficient counterparts will not only pay for itself, it will help you save money and reduce your impact on the environment.

65. Buy Second Hand Equipment

If you’re strapped for funds and trying to get your restaurant operation started, you might want to look into buying second hand equipment.

Make sure to check Craigslist, Facebook Marketplace, Ebay, and Google.

66. Complete Warranty Cards

When you buy new equipment, you should complete and return the manufacturer’s warranty card as soon as possible.

In most cases, parts and labor for equipment repairs are likely available, but the warranty will be nullified if you do not complete the registration.

67. Keep Extra Parts in Stock

If your equipment breaks in the middle or beginning of the day, how much money do you lose over the course of the day?

You can prevent yourself from losing money by keeping commonly replaced parts in stock for on the fly repairs.

Just make sure you aren't voiding any warranties!

68. Clean your Refrigerator and Freezer Coils

Blow out your refrigerator and freezer coils and filters & clean them every 2 months. This preventative maintenance is worth the 5 minutes it takes, and it will surely save you on future repairs.

69. Boil Out and Deep Clean Your Fryer

Regularly clean your deep fryers, especially if your restaurant serves a large amount of fried food.

Cleaning out your fryers consistently will help you get the most lifetime out of them.

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Business Strategies

70. Become Mobile

If your business needs to make a drastic pivot to reduce costs, consider switching from a brick and mortar concept to a food truck concept.

Food trucks don’t have to worry about budgeting for cutlery expenses, furniture expenses, or rent expenses. If traditional isn’t working out for you, consider joining the food truck revolution!

71. Streamline your Suppliers

Restaurantowner.com states that they’ve “noticed that the practice of buying a large portion of products from one broadline supplier is much more common in more highly profitable restaurants than it is in marginally successful ones.”

Streamlining your shopping through one supplier has been shown to help restaurants cut costs on their purchasing. This is definitely something that you should look into.

72. Ask your Food Suppliers to Email you Weekly Pricing Updates

Supplier pricing changes from time-to-time and if you aren’t aware of these changes, you aren’t making the most of your budget.

Your supplier will happily provide you with these updates so that you can make the most informed decisions.

73. Chef Store by US Foods

If you didn’t already know, US Foods offers a Chef Store for professional chefs and home chefs alike. This is a great resource to check out, especially if you’re a small scale operation.

Memberships aren't required and the public is welcome, so check it out!

74. Negotiate with Local Vendors

If you haven’t yet, start looking into the pricing of inventory that local suppliers can provide to you. Oftentimes, local vendors can be a more affordable partner than big brand suppliers.

75. Revisit Packaging

Packaging, especially unique packaging, is an expense that can most often be reduced or optimized.

Depending on your situation, you might want to consider packaging that is more cost effective than your current packaging.

76. Take Advantage of Discount Towel Services

Did you know that you can join the National Federation of Independent Business (also known as “NFIB”) and use their discount to set up towel services with Unifirst?

Joining this organization is easy to do and provides numerous other benefits.

77. Consider Switching to a Seasonal Business

61% of restaurants notice a decline in patrons during a seasonal holiday or major event.

These seasonal declines in business can be as much as 20%, and for some restaurants, it just doesn’t make financial sense to stay open year round.

Switching to a seasonal business model is an avenue that you might want to think about, especially if you’re never considered it before.

78. Offer a Cash Discount on Menu Items

Implementing a cash discount could look like reducing the bill of cash payers, or it could look like introducing a fee on card users.

One restaurant owner added 4% to the prices if customers use credit cards and saved $30,000 per location in one year.

79. Shop Around for Energy and Gas

You may not know this, but prices on energy and gas services can vary widely across service providers.

Make sure to shop around on a regular basis to ensure that you’re getting the best price possible.

80. Hire a Cash Flow Management Professional

If you’re responsible for the books and you know you’re not up to snuff, hire someone else to be responsible for cash flow management.

Hiring someone will require them to be on payroll, but sometimes, they will be able to save you more than enough money to cover their expenses by managing the books properly.

81. Establish a Budget

Too many try to save money without using a budget.

This should be the first step you take to save more money. Being accountable for your cashflow is the best way to responsibly cut back.

82. Consider Promoting Merchandise

Do you own a brand that is loved by many?

It might be worthwhile to consider selling merchandise as another revenue stream.

You can sell shirts, hats, salt and pepper shakers, or anything you can think of. If your fanbase is loyal enough, you will see income from this venture.

83. Consolidate Credit Card Debt

Consolidating all of your debt onto your lowest APR card possible can be a viable way to reduce interest costs and make your payments more manageable.

84. Ask Suppliers for Discount

You will never receive a discount on your inventory orders if you never ask.

Next time you’re speaking with your supplier, ask them if there are any upcoming discounts that you can plan your shipments around.

85. Consider Switching Banks

Although it can sometimes be inconvenient, switching banks might be able to improve your financial situation over the long term. Changing banks can lower your fees and raise interest rates.

86. Go Direct Deposit

If you’re still paying your employees via physical check, it’s time to make the switch.

Not only is it more convenient for employees, it helps you save by not purchasing blank checks and pay stubs.

87. Amend Recent Tax Filings

If you’re really strapped for cash, you might want to look over your previous tax filings for any mistakes made on your part.

If you do find that you have made a mistake and overpaid, you can fill out a form 1040-X and receive that money back in the form of a return.

88. Split Bulk Costs with Another Business

If you’re a small operation that would benefit from buying supplies in bulk, but can’t quite justify purchasing in such large quantities, you might want to consider forming a partnership with another business to split costs on bulk loads. This is generally a win-win situation, and forming that partnership can lead you to new avenues in the future.

89. Join a Trade Association

There are numerous benefits to joining a trade association. The largest trade association in the restaurant industry is the National Restaurant Association.

Benefits to joining the NRA include education, insights. for financial decisions, and discounts on services and products, including health care.

90. Use Price Comparison Websites

Price comparison websites exist for almost any product or service now. It might be a good idea to make a habit of checking these websites periodically for ways to save money.

91. Sub-lease your Space

Getting creative is the name of the game when trying to save money as a restaurant owner.

Sub-leasing your space is a viable option for some business owners who are in the market for some extra money in their pocket. Make sure you inform yourself on all of the pros and cons of subleasing your space before jumping into it.

92. Look into Investing in Solar

Most business owners know that one of the highest overhead costs they have to account for is the cost of electricity. But what if your business was able to be reliant on its own electricity?

Installing solar panels for your business may require an initial investment, but it usually pays itself back in a short amount of time.

93. Be Aware of all Deductions

Meeting with a tax professional or researching on your own for a few hours to discover all of the deductions that you qualify for can pay off immensely at tax time.

Here are 25 deductions that you can check out to start off your research.

94. Pay Wages to your Children

This one might seem crazy, but paying wages to your children can actually help you save money.

As David L. Scott, author of The Guide to Saving Money puts it, “you can essentially transfer income from your business to them [to save money]”.

95. Sponsor Local Events and Organizations

Sponsoring events and organizations can help you generate customers, boost brand visibility, and form strategic partnerships.

Although these sponsorships usually do require a financial commitment, the benefits can outweigh the investment. Before you enter into a sponsorship agreement, it’s a good idea to set a KPI to measure your success with.

96. Refinance Debt

If your business is maturing and you’ve successfully received financing, a natural next step should be planning for refinancing.

The needs of your business are always changing, so you might as well make your debt work best for you.

97. Choose a Space with Natural Light

If you’re in the process of choosing a location for your restaurant, you might want to consider how much natural light is emitted into the environment.

By having a restaurant with natural light, you don’t need to use artificial lighting, therefore cutting down costs on your utility bill.

98. Negotiate with your Landlord

Some landlords value having a tenant in their space over more money, so negotiating your rate for a longer lease might be a good option.

The worst thing they can do is decline your offer.

99. Track all Expenses

Tracking expenses works hand in hand with having a budget.

So many business owners do one or the other, or worse, neither.

You should be tracking your expenses on a consistent basis to ensure you’re sticking to your budget.

100. Create Strategic Partnerships

Creating the right strategic partnerships can open the door for new expertise, resources, and revenue for your business. You don’t have to act as a lone wolf in the business world.

101. Pay Invoices Early

Some of your suppliers may offer an early payment discount, also known as a prompt payment discount.

If you find out that one of your suppliers offers this discount, do your best to try and pay the invoices before their maturity date.

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Conclusion

Well that's it! 101 different ways to maximize your dollars as a restaurant owner. We hope you were able to walk away from reading this with at least a few tips that you can apply to your business. If you would like to learn more about hiring a robot, please click the contact us button and a business representative will speak with you shortly.