Okay folks, Brexit is upon us. Regardless of where you stand on the nation’s great existential question, it is going to impact your business, my business and everyone else’s business. So we’d all better be ready!
But we entrepreneurs are made of strong stuff. We’re not going to cry. We are used to it. Every single day brings uncertainty. Every tomorrow brings even more!
So, the 1st November 2019 will be a day like any other. We’ll roll up our sleeves and get to work. But we will be clever. We will protect and grow our profits.
However, if you ask the café owners, sandwich shop proprietors and owner operators of the UK how they are going to go about this task you’ll likely hear them say, ‘New improved marketing and promotions, prime the social media pump and stuff the neighbourhood’s letter boxes with flyers’. In other words: GET MORE SALES!
It’s a solid strategy. More customers = more repeat business = more money in the till. However, often the fastest way to increase profit quickly is to lower your costs. John Richardson, of The Coffee Boys, said something along these lines that stuck with me: “It’s easier to save a pound than make a pound.”
Stop your staff throwing cutlery in the bin and you’ll stop having to buy teaspoons all the time – simples!
Here’s some suggestions for reducing your costs:
• Reduce staff head count
• Train your staff to be competent in more areas of the business
• Get your kitchen porter trained to work the pans and the pass
• Change your buildings and contents insurance policy
• Change your utility suppliers
• Look into your waste collection costs
• Card processing fees – c’mon!
• Look at your profit and loss carefully. Forensically find and get rid of unnecessary expenditure
• Look carefully at wastage. Under prep dishes to avoid waste
• Eliminate products and menu items that don’t sell
• Close on slow days/evenings
• Stop serving breakfast Monday to Friday
• No print ads
• Do your own Instagram
• Motivate your managers with performance management tied to food, labour and profit
• Reduce stock holding;
• Portion control. Portion control. Portion control!
All these suggestions work to reduce costs in your business, but be careful. Never take a slash and burn approach. Proceed with caution. Always think about how a proposed cut will impact on your guest experience and also on your employee morale.
A change that makes your guests have a worse time at your establishment is probably not worth any potential savings. A change that affects your employees negatively can also create big problems for you. If you identify a saving, make sure you explain clearly why cutting costs is essential to the health of the business.
There are times when a business has to take a hard look at where the money goes. If you’re going to stay profitable, now is the time. Cutting costs is a necessary part of business management and can be the quickest route to increased profitability when you need it.
Good luck, everybody!