One of our first clients was a restaurant that had been open for little over a year. The restaurant had some capitalization issues and needed to find innovative ways to reduce its expenses while maintaining or, even better, growing sales. Compounding the situation was that it was also facing a seasonal downturn in business which brought enormous concern that it would not be able to remain cash flow positive until warmer months and increased sales arrived.
Our number one goal was to stabilize cash flow by significantly reducing overhead without compromising the quality of the restaurant. We attacked the usual suspects by analyzing food purchasing and staffing costs. In both instances, we introduced simple financial tracking tools which allowed management to purchase and schedule in real time with total insight into their current expenditure to budget percentages. We also looked for inefficiencies in opening and closing processes as well as legacy software systems that were being utilized. Lastly, we met with current vendors and in some cases established new vendor relations in order to negotiate better terms for the restaurant.
The introduction of financial tools allowing for more informative decision making quickly led to cost savings both in terms of expenditure and staff scheduling. Cost savings were also significant when opening and closing processes were analyzed for inefficiencies. By replacing the existing reservation system with a new, modernized platform, the restaurant experienced greater marketing reach, enhanced customer communication, and less expensive hosting fees. Finally, re-negotiating existing vendor contracts for improved terms made an enormous bottom-line impact almost immediately.