I love the machinations of business, always have. The basic concept of buy low-sell high is the very cornerstone of making money in the retail sector. Sales price minus expenses equals profit. I worked in the retail sector for a short time and absolutely loved it. Great hours, excellent pay and bonus, and I lived 2 miles from work. Great job.
The differences between making money in a food service operation and the retail arena are many.
In retail, in management, you have shrink as your biggest enemy. Shrink represents any amount less than your purchases minus expenses. At the store level shrink can be attributed to mispricing, theft, or what I found most often were inaccurate inventories. This led to false numbers (low or high) on the P&L’s. The lower your shrink, the higher your profits. Sounds pretty simple.
In food service, your enemies are food cost, labor cost, gas/utilities, rent, theft, and waste. I worked for a short time as a restaurant consultant, reviewing physical operations for efficiency. I said the same thing over and over in my reviews: First and foremost keep accurate records. Keep daily running inventories of the walk-in and cooler, physically check EVERY SINGLE THING that comes in to the restaurant against the invoice, physically ensure the quality of the seafood, meats, and produce. Inventory high-cost items bi-monthly. Pay your staff fairly. KEEP YOUR PEOPLE HAPPY. The residual effects of having a HAPPY staff will pay off in terms of production equaling lower costs and higher profits (and less theft). Better training will help reduce waste, paying for itself in higher inventories, resulting in higher profits. And they paid me for this brilliant advice!
Sounds pretty simple.
There a few totally awesome feelings you can receive in our sphere of existence. One of them is the rush you get when you hand out the very first paychecks to your employees. Almost as big of a rush as you get as when you receive your first sale.
As an owner/operator you know the difficulties involved in trying to make money in food service are nowhere near as simple as I make them out to be. Believe me, brothers and sisters, I have felt the pains. The pains of a fully-trained staff impeccably outfitted and awaiting a big Friday night crowd. The best money-making night of the week for employer and employee (Win-Win). Sometimes you can do everything absolutely right and still not enjoy success. An unexpected ice storm blows in choking off all access to your restaurant. It is a tough way to make a living.
The pandemic has altered our business landscape forever, the retail sector is becoming less of a personal experience, so let’s keep the restaurant and food service industry alive and kickin’ ass. Patronize when able and tip when deserved.
Have fun and