5 Ways to Decrease Your Restaurant's Overhead Costs | Transaction Services

If you run or manage a restaurant, then you might be wondering what steps you can take so that you can reduce your overhead. Although running a restaurant can be rewarding, it’s also a challenging process that can cause anyone to experience stress. Getting the most from your effort requires you to find creative ways to reduce your expenses without harming your guests’ enjoyment.

At first, reaching this goal might seem impossible, but you can easily get your budget under control when you follow the right steps, and you will be happy with the outcome. If you don’t know where to turn, the following information will point you in the right direction.


Buying the equipment that you need to keep your restaurant at its best is likely one of your biggest expenses. Commercial stoves and dishwashers are not cheap, and if you need to replace your old equipment, your budget could be impacted in a negative way. Rather than purchasing new equipment from conventional sources, take a look at local auctions that might have the things for which you are looking, and doing so can help you save more money than you might suspect. In addition to stoves and dishwashers, you can also find knives, spoons and plates when you attend auctions that are in your market.

Email Marketing

Getting people to walk through your doors is no easy task, and you probably spend a lot of money on advertising campaigns if your goal is to keep attracting new customers. If you are overlooking the power of email marketing when it comes to managing your expenses, then you are leaving money on the table. Email marketing allows you to stay in touch with your past and potential customers to encourage them to come to your restaurant. If you treat your guests well, many of them will be happy to return for another meal, but you can’t expect them to remember you.

You can email people to keep your restaurant at the front of their minds, and this tactic will work wonders for your profitability. However, you must remember that many of your guests will be reluctant to give you their contact information, and you will need a strategy. Offering special discounts and exclusive offers will allow you to get past their resistance, and your customers will gladly enter their email address when you give them something valuable in return. After people start signing up for your list, ensure that you stay in contact with them on a regular basis.

Encourage Referrals

Consumers are more likely to trust their friends than they are to trust what they hear in an advertisement, and using this fact to your advantage will help you bring in more customers than ever before. But asking your customers to refer their friends will also serve to reduce your marketing expenses. The key to getting people to participate in your referral program is to provide outstanding service at all times.

Your guests will be that much more likely to tell their friends and family about you if you impress them, but you need to take it a step further if you want this method to work for you. Always offer referral rewards and bonuses to anyone who helps you get customers, which is easy. You can give a free meal to those who send a certain number of people into your establishment, but you will need a way to track the referrals.

Protect Your Data

If you want your business to remain successful, then it’s essential you proactively protect your guests’ personal information. Identity theft is a growing issue, and allowing the personal information of your customers to get compromised is enough to destroy your reputation. One incident is all that it takes to make people hesitant to buy from you, and your restaurant might not be able to recover. Because people want to know that their sensitive information is safe, you need to show them that you care about digital security. Even if you don’t store valuable information on your server, you are still at risk if you accept credit card payments.

Criminals can compromise your network and read any credit card number that you process, but you can protect yourself and your guests by using secure restaurant credit card processing. Businesses that provide that service will encrypt the information that you send, and criminals will not be able to access the credit card numbers as a result. Many people ignore cyber threats because they don’t feel as though their business will ever be compromised. But anyone could be targeted, and being prepared in advance is better than trying to clean up the mess after a security breach takes place.

Develop Leadership Skills

Although taking care of your customers is an important part of running a restaurant, treating your employees well is also a critical piece of the puzzle. Retaining your team members is less costly than consistently recruiting and training new people. So putting in the effort to develop leadership skills and to improve your employee retention rate will go a long way when it comes to getting the most from your budget.

If you want to earn the trust of your team, then speak with them in a positive tone, but inspiring each person who works for you to improve will enhance your productivity. Rather than hiring managers from other companies, promote from within your team when possible. When you do so, they will have even more motivation because they will know that they have the opportunity to increase their pay rate.

Final Thoughts

Using those tactics will help you cut your spending, but some restaurant owners believe that they only need to focus on optimizing their budget once, which is a mistake. If you want to stay ahead of the competition, then you must always balance your income and spending when your wish is to achieve long-term profitability. You can also change some of the methods to make them fit your individual needs because each restaurant is different.

Although it might take some time, finding the right combination will be worth the wait, and you can use the money that you save to grow your restaurant and to build your brand.