People love eating fine foods, and this country is full of fantastic restaurants which strive to fulfill the palettes of these culinary aficionados. However, the high-end restaurant industry is finding that with the current economic conditions, customers are eating out less – especially in the fine-dining business. There has been a noticeable decline in check averages and sale, yet prices for commodities are still high along with minimum wage and benefits costs. How does a restaurateur balance their desire to serve the best cuisine while also maintaining a tightly run restaurant?  

First and foremost, restaurateurs must not forget that they are a business in need of strong financial management. Focus must be put on gaining timely financial information in order to make smart operational decisions. John Priest, VP of Operations at Vine Solutions, Inc. says, “Focus must be put on curbing excess spending and re-evaluating current operations. Food and beverage costs have to be adjusted to be financially sound.”

Although every restaurant strives to have creative dishes, menu planning must focus on the cost of the ingredients. Each recipe placed on a menu must be individually costed out beforehand. Chefs should also try to include using all parts of the ingredients in their dishes. Waste management should be focused on not only for environmental purposes but also to eliminate unnecessary spending.  Special focus needs to be spent on labor costs – especially back of house costs. Weekly schedules also need to be costed out and significant overtime must be eliminated.

Through the next few years, some restaurants will not survive and others will. Old favorites will close, and new endeavors will open. Great food and great restaurants can be inspirational to everyone, and because of this, the culinary world is a resilient world. “Restaurants need to understand that it is going to be a tough road, with many hard decisions to be made,” Priest states, “however, those who come out on the other side of this will be stronger, more confident, and more prosperous than ever.”

Vine Solutions, Inc. was incorporated in 1996 and has offices in Corte Madera and Santa Monica, California.  Vine Solutions, Inc., provides accounting and financial advisory services to a variety of high volume independent restaurants and regional chains.  For more information, e-mail Vine  Solutions at info@vinesolutions.com, follow us on twitter at twitter.com/VineSolutions or read our blog at restaurantaccountingblog.com.