Question

There is a large number of benefits for restaurants who regularly monitor the cost of their menu items. To do this, You have to invest in the right tools and encourage your staff to understand this process. What is your take on this subject? Do you know of any restaurants who do poorly in this area or others who base their success in this principle? If so, can you share what these restaurants or corporations are and the reason you believe that?

Answer 1

This is completely true that for successful restaurant operations, it is important that the management must keep a close eye on the price or cost of the menu items as ultimately these are the cost of the menu items that will determine the profitability of the organization. If the cost is increased, the management might be forced to increase the price of the menu items and it can result in the diversion of the customs to the other restaurants. Therefore the management must try to control the cost of the menu items by having greater productivity and fewer wastages.

McDonald's is the best example of this philosophy. McDonald's offer a variety of menu items to its customers at a reasonable price. In order to make sure that there is no frequent change in the menu item prices, and to ensure the profitability of the company, the management keeps on implementing the various methods and technology so that the cost of the items can be reduced and at the same time the company also uses the latest technology to reduce the operational expenses. The typical example of this can be seen as the use of robots and AI for the operations and order placing and processing.