Have you raised restaurant or banquet prices over the last six months? Have you changed your food cost target? Have you spoken to your GM about higher food prices? Have you spoken to your board and food committee about inflation and price fluctuations?
You are late to the party if you have not done this for the last six months.
I have received several calls over the last few weeks from chefs asking me how to deal with this. They’ve said that their managers are questioning their food costs and that they cannot meet the budget. My answer to them? Give them the numbers.
Over the last six months, I have diligently shared this information with my GM and catering director. We speak weekly, if not daily, about the cost of goods and the pricing of events and menus.
I am providing a combination of all the items listed below consistently:
Top 40 items: I ran a report on the total purchase price of the top 20 items by dollar value and top 20 items by case volume. I used the average of 3 months in 2022, 2021, 2020 and 2019. These reports allow me to see price increases in the most expensive items, such as beef, fish, and chicken, as well as the price changes in items not so expensive as mesclun, eggs, cream, and milk, but due to volume have a significant impact on my food cost.
Sales mix: What is your true sales mix? We all have loss leaders. These are the items we cannot change. However, I was able to prove that I could raise the price on two of my five best sellers without ruffling any feathers.
Do not lock prices: We provide estimates for banquets. We do not commit a price until 30 days before the event. Members are aware of the market conditions. They are dealing with the same issues, and if framed correctly, they understand. We price some events higher, giving us the buffer to cover last-minute changes. We also are honest about this, and when possible, we drop the final price as soon as we place the order, making sure the member is notified.
Revisit pricing strategies: We have a semi-static menu and decided to absorb the price increases for our in-house a la carte dining until August. Instead, we increased all the club event pricing by as much as 20%. We have eight seasonal culinary creations and three daily features priced according to current market conditions and local competition. It also helped that we were lucky enough that we had our sales mix altered by a large influx of banquets during the spring. This allowed us to maintain a la carte pricing, helping us with our overall food cost target.
Check your orders: We have become more diligent about receiving and ordering, keeping par levels tight, checking every item that comes in, box by box and item by item, and ensuring there is no damaged or spoiled product being put away by untrained staff.
Keep storage organized: The team is focused on rotation and cross-utilizing items, reducing waste, utilizing byproducts for sellable items, and being more proactive about our soup schedule, lunch features, and dinner features. (Salmon belly makes amazing tartare and salmon cakes!)
Look at price history: After the summer doldrums, we felt the impact of no banquets and decided to look at pricing for the restaurant finally. We looked at the price history, targeting the items that have not been adjusted because of fear of member backlash. Since our members receive copies of all of their chits with their statements, we changed prices on the first of the month, so there is no easy comparison or red flags. Some items changed as much as 20%, yet these items have had the same price for the last 3 to 4 years (believe it or not).
Inform your leaders: Every week, I receive the market reports. Those pamphlets with red, yellow, and green next to all the produce items, availability, price, and the alerts for lettuce wilt, hail, and drought will affect our future pricing. I selectively forward some of them to my General Manager, Clubhouse Manager, and Food Committee Chair, making sure I ask for feedback to ensure they are reading it and are aware of the struggle.
Explore your Sources: We continuously look at different vendors, evaluate the specs and ensure we are getting the best possible quality for the price we pay. We ask if there is something else they can offer to substitute or better-priced alternatives to what we have. All these vendors have burn lists, and we create our features from them, focusing on our craft and skill level to elevate items where we can make more money.
Portion Control: We revisited portions not only for proteins but for salads, appetizers and side items. A ¼ oz. of lettuce is not noticeable, yet it can make a difference when you make 300 salads three times per week.
The bottom line is to be proactive, talk to your manager, keep them informed, and show them the invoices, the damaged product, the lower quality fish, the lower yield lettuce with brown spots, or the twice as expensive butter that you need for the hollandaise every day. Give them the information to go to the board, to educate them so they can think beyond the end of the month report and the food cost percentages.
You must ensure your members get the best product available and your leaders are comfortable explaining the food cost changes to support your price changes. They can’t protect and help you if they don’t have the information.