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The Fastest Way To Drop Those Unwanted Food Cost Percentages

Lower your food cost today, without changing how you do anything and maybe even put some of that savings in your bank account!  [Pause for cheesy infomercial music]

We work in a world of percentages: Food Cost Percentage, Labor Cost Percentage, Profit Percentage. The list goes on and on and we face tremendous pressure and often depend on achieving our percentage goals so that we can make our bonuses or even keep our jobs.

There are hundreds of articles floating around the web on how to lower food costs, usually all great guidelines and industry standards, however, one of the simplest ways to lower food cost is almost never mentioned.

“You can’t put percentages in the bank!”… or can you?

The fastest way to drop your food cost is to manage your margin percentages with your vendors.  If your account is set up with a cost-plus-% type pricing structure, you can negotiate with your vendors to give you higher mark up percentages on non-food items (paper goods, cleaning supplies, etc.) and lower your mark up percentages on your food items. For your vendor, it should be a wash and you’ll see a drop in your food costs.  Additionally, by setting up your price margins to have lower percentages on your more volatile products, such as meat and dairy, you’ll take less of a hit during market swings, and add to your savings.

Of course you are not going to see a dramatic drop, if your costs are off by 5-10 points this won’t fix your problems. And yes, your bottom line would still end up at about the same place, but if you just need that point or two to hit your goals and make that bonus, this may be just the ticket!

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7 Responses to "The Fastest Way To Drop Those Unwanted Food Cost Percentages"

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