3 tips for Increasing Restaurant Profitability

Increasing profitability is always a challenging task for every business owner, especially those in the restaurant industry. Restaurateurs and operators already deal with a number of daily tasks, and worrying about revenue growth just adds to all of the madness.

The key drivers of restaurant profitability are smooth, seamless operations and exceptional customer service but oftentimes, these factors are overlooked. High sales do not automatically translate to being profitable, as costs will continue to increase. The two main risks in the industry are rising wages and food costs. The answer to all of this is to become more efficient. Listed below are a few helpful tips for restaurant owners to increase profits.

Hiring and Incentivizing 

The turnover rate in the restaurant industry is known for being incredibly high. Employees are constantly cycling through and very few seem to stick. The key is to hire the right people and to incorporate incentives. First, you need to find passionate, motivated, and hard-working employees – not just anyone who shows up to an interview. Once you hire the right people, you can then implement some profitability incentives.  These rewards can be bonuses for the team, for example. This will help align focus within your staff and crew and boost the team’s morale.

Evaluate Cost

No matter how high your sales are, costs will continue to rise with them. Customers are becoming more health and environmentally conscious. The demand for healthier ingredients are on the rise, and that comes with a higher price tag. In order to increase profitability, you must keep track of all of your food and product costs as well as continually update your menu pricing to reflect this.

Restaurant Technologies

The use of IoT and automation in restaurants is becoming an industry standard. The implementation of this technology increases efficiency, reduces risk, and ensures smooth sailing operations. By adapting to these technological advancements, you will gain access to valuable insights to make critical business decisions. Be in the know of your operations at all times. Keep track and monitor equipment status. Be alerted of any downtime or failures. Adding smart technologies to your business will give you both an advantage over competitors, as well as improve overall restaurant efficiency.

Owning a restaurant is not an easy job, and ensuring that your business is not just “getting by” but is successful, is even more difficult. Implementing these tips at your restaurant(s) will help to pave the way to a fruitful and profitable business.


  1. Crawford, Rory. “Restaurant Profitability and Failure Rates: What You Need to Know: Modern Restaurant Management: The Business of Eating & Restaurant Management News.” Modern Restaurant Management, 11 Apr. 2019, www.modernrestaurantmanagement.com/restaurant-profitability-and-failure-rates-what-you-need-to-know/.

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