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Inspecting your restaurant supply chain to help with rising costs

Dec 11, 2012

The meals you eat at your favorite restaurants may be costing you more these days. One of the largest droughts since the 1950’s is hitting our nation’s most valuable crops like corn and soybeans, hard. Since much livestock like cattle, pork and even chicken are corn fed, this is resulting in a more expensive animal to raise. And even going beyond that, according to this LA Times article, “The price of corn — a key component in livestock feed and an ingredient in powdered sugar, salad dressing, soda and more — catapulted 60% in early summer.”

 

So, how’s a restaurant to cope? The most obvious answer (raising menu prices across the board) is not necessarily the best or most efficient solution. After all, the economy is still slow and consumers are still conscious of how they spend. A restaurant must look into several facets of their supply chain:

 

1) Supply contracts: how well are negotiating your supply contracts? Are you locking in prices far in advance to hedge against future price volatility? Are there alternative suppliers you can look into?

2) Reducing waste: is your restaurant really doing all it can? Reducing waste allows for reduced costs!

3) Inspect and manage your menu: find areas of your menu that you may be able to reduce or altogether replace food items that are less costly in today’s economic environment. Also, take a look at controlling portion sizes.

4) And how do you do all of the above while still managing to deliver a perception of value to the consumer?

 

If you would like to take a closer look into your supply chain management, contact Synergy Restaurant Consultants; our experienced restaurant consultants can assess your supply management program and discover areas for operational efficiency and cost reduction.