Increasing Restaurant Efficiency: A Guide to Streamlining Operations

By Andreas Mettler|Dec 19, 2023|12:05 pm CST

In the highly competitive restaurant industry, efficiency is more than a buzzword; it’s the backbone of a successful operation. From streamlining the booking process to optimizing staff schedules, ensuring that each aspect of your restaurant operates like a well-oiled machine can be the difference between success and failure.

In this guide, we’ll dive deep into restaurant efficiency, exploring both why it’s so important and concrete ways you can improve your restaurant’s levels of efficiency.

What exactly is restaurant efficiency?

First, let’s make sure we’re on the same page regarding exactly what restaurant efficiency is.

Restaurant efficiency refers to a restaurant’s ability to optimize its resources and processes to achieve maximum output with minimal input.

In other words, it’s about how well a restaurant can operate to provide excellent service and quality food while minimizing waste, costs, and time. It’s about finding the perfect balance between providing the best customer experience and reducing costs.

How efficient is your restaurant?

The more efficient you are, the better your operations across multiple areas.

There are many different facets to efficiency, including:

• Operational Processes: Having well-defined processes and workflows can make day-to-day activities more efficient. This includes everything from how orders are taken and food is prepared to how tables are cleared and bills are paid. 
• Staffing: You need to have the right number of people working at the right time in order to operate at peak restaurant efficiency. This means avoiding overstaffing, which can lead to unnecessary labor costs, as well as understaffing, which can result in poor service and decreased efficiency. 
• Inventory Management: Restaurant efficiency and restaurant inventory management are closely related. A well-managed inventory leads to lower waste, higher profits, and better overall efficiency. 
• Customer Service: The most efficient restaurants provide superior customer service. They have well-trained staff who effectively handle customer questions, complaints, and special requests. 
• Technology and Automation: Technology and automation play a crucial role in efficiency. From restaurant inventory management software to online ordering to POS systems that track sales data, the right technology stack can empower your restaurant to operate at peak efficiency.  
• Scaling: The more efficient your operations, the more scalable your restaurant is. With streamlined processes, you can quickly scale up or down to meet changing demand, as well as scale more easily across multiple locations. 
• Financial Management: Restaurant efficiency also means staying on top of finances. This includes tracking sales and expenses, identifying areas for cost-cutting, and maintaining a healthy profit margin. 
• Menu Engineering: Menu engineering involves identifying your most profitable and popular dishes and then optimizing your menu for maximum profit. By eliminating unprofitable dishes, you significantly reduce waste and expenses and increase efficiency.

Why restaurant efficiency matters to your bottom line

Does restaurant efficiency REALLY matter that much?

Yes, it does.

Your efficiency impacts many different areas of your restaurant.

Labor costs

Efficient restaurant employee scheduling, training, and management saves you money in labor costs. When you optimize your scheduling, you ensure that you have enough staff to handle customer demand without overstaffing and wasting money on unnecessary labor hours.

Inventory costs

Effective restaurant inventory management reduces waste, spoilage, and overstocking. It also ensures your restaurant is using ingredients efficiently and minimizing unnecessary expenses. This, in turn, reduces your inventory costs.

Table turnover

A well-trained, efficient restaurant staff can improve your table turnover time, which directly impacts your revenue. Well-managed reservations, fast service, and effective communication among staff can contribute to faster table turnover.

Customer satisfaction

When your restaurant is operating efficiently, you have the staff you need to meet customer demand, keep wait times reasonable, and provide excellent service. You also have the necessary inventory to provide the menu items customers want. This leads to happier customers. Happy customers are more likely to return and recommend your restaurant to others.

Online reviews and ratings

With the rise of online review platforms, restaurant efficiency matters even more. Poor restaurant management with slow service and inefficient operations can quickly earn negative reviews and low ratings, deterring potential customers from dining at your establishment.

Revenue

Ultimately, all of the above reasons come together to impact what matters most: revenue. High labor and inventory costs equal lower revenue. Slower table turnover and lower customer satisfaction mean fewer sales. This is why efficiency matters so much. It’s not just about running a finely tuned machine, though that’s certainly part of it. 

It’s about running a restaurant business that’s actually profitable. 

By focusing on efficiency, you can increase your restaurant’s profitability and ensure the long-term success of your restaurant. You can build a restaurant that not only runs well but also:

• Attracts and retains customers
• Builds a strong brand image
• Earns positive reviews
• Generates profits
• Stands the test of time

Focus on the customer experience

Let’s start with what’s most important: your customers.

Nothing is more important than the customer experience. It doesn’t matter how efficient you’re restaurant is – if you provide a subpar customer experience your restaurant will suffer. You’ll experience complaints, poor reviews, and a dwindling audience. All of this will ultimately lead to lower sales and less revenue.

So yes, you should focus your efforts on improving your restaurant efficiency.

But always, always, always keep the customer experience at the forefront. Your pursuit of efficiency should be so that you can provide your customers with a fantastic experience. It does you no good to improve efficiency at the expense of the customer.

As you consider the following recommendations and strategies, think about how they can help you better serve your customers.

Streamline kitchen operations

When it comes to efficiency, look to the kitchen. Improving efficiency in the kitchen sends positive ripples into other areas of restaurant operations, from food quality to customer satisfaction.

Consider the following ways to streamline kitchen operations:

• Optimize Layout: Is your kitchen laid out to facilitate smooth operations? Is equipment placed strategically to minimize unnecessary movements? Do you have stations dedicated to specific tasks? Implementing these types of practices can significantly improve kitchen efficiency. 
• Standardize Recipes and Procedures: Every item on the menu should have a standardized menu and procedure for creating it. This is where recipe and menu engineering software can be a significant asset. It can help you determine the most efficient way to create each menu item, from prep work to plating. 
• Utilize Dynamic Prep and Thaw: By organizing food preparation work and thawing schedules around peak times, you can reduce waste and ensure ingredients are always fresh. Software like MacromatiX makes it possible to predict demand and then update production plans dynamically in real time. 
• Train and Cross-Train Staff: Well-trained staff is essential for efficient kitchen operations. Make sure your team is trained not only on their specific roles but also in other areas of the kitchen so they can step in when needed.  
• Utilize Technology: Investing in technology such as kitchen display systems and online ordering can significantly improve efficiency in the kitchen. These tools can automate processes, reduce errors, and improve communication between front-of-house and back-of-house staff.
  
  The right technology also helps you automate non-value-added work for managers. Rather than spending hours on repetitive tasks, you can focus on what you do best – providing great customer experiences. 

Practice effective staff scheduling

You’re only as efficient as your staff, and restaurant staff scheduling plays a significant role in restaurant efficiency. If you have too many employees scheduled, your labor costs go through the roof and you become massively inefficient. On the other hand, too few employees make it hard to meet customer demand.

You need to walk the fine line of having enough staff to meet demand while also keeping labor costs in check.

This is where restaurant employee scheduling software like HotSchedules can be a game changer. Utilizing AI forecasting, HotSchedules allows you to accurately predict customer demand and then schedule employees to meet that demand. This precise employee scheduling can save you between 3 – 5% in labor costs and greatly improve your efficiency.

 Focus on inventory and supply chain management

Keeping track of inventory levels and managing your supply chain is crucial for running an efficient restaurant. With food spoilage, over-ordering, and supply shortages being major sources of waste, it’s essential to have a solid restaurant inventory management system in place to manage these areas.

Restaurant inventory management software like MacromatiX can transform the way you manage your inventory and supply chain. Key benefits include:

• Manage all your suppliers from a single, centralized platform
• Automate key processes and reduce time spent on administrative tasks
• Track inventory levels in real-time and respond quickly to changes in demand
• Accurately forecast demand levels and then order inventory accordingly. Going from manual calculations to AI forecasting using Fourth’s technology, for example, increases your accuracy by up to 75%.
• Grant local teams autonomy while ensuring your central management team maintains budget control and visibility into operations across the brand
• Create a central library of recipes cost precisely by ingredient and nutritional value, with portion size and plating guidelines

Robust inventory management software also makes things easier for your employees, who have to regularly count inventory. 

“If you can reduce the amount of time that it takes to do inventory at the end of the night, you improve your employees’ quality of life.”

–  Andreas Mettler, Senior Director Solution Center, Fourth

 Incentivize staff

Whenever possible, incentivize your staff to prioritize efficiency without compromising the customer experience.

What do these incentives look like practically?

First, consider performance-based bonuses tied to efficiency KPIs, like table turnover, customer satisfaction scores, and sales targets. Money often speaks louder than words, and doing this directly links individual and team efforts to financial rewards.

Also, look for ways to recognize and appreciate staff achievements and efforts. This can include formal programs, like employee of the month, as well as less formal things, like publicly encouraging a specific employee during team meetings.

Another way to incentivize your staff toward efficiency is by creating a culture of continuous improvement. Encourage and reward ideas from your team on how to improve processes, reduce food waste, or increase productivity. By involving them in the process and recognizing their contributions, you are showing that their input is valued and can lead to tangible results.

Furthermore, make sure to regularly communicate with your staff about the importance of efficiency and how it positively impacts both the restaurant and their own job satisfaction. This will help foster a sense of ownership and accountability among your staff, leading to a more proactive approach towards efficiency.

Make training and staff development a priority

Staff training is essential for increasing the efficiency of your restaurant. By investing in your staff’s development, you are equipping them with the necessary skills and knowledge to perform their job efficiently and effectively.

What areas should you focus your training on? Consider:

• Efficient Table Turnover: Your staff should have a solid understanding of how to maximize table turnover without compromising the customer experience.  This includes efficient cleaning and resetting of tables, as well as timely and attentive service.
• Time Management: This is especially important when your restaurant is busy. Your team members should know how to prioritize tasks, juggle multiple responsibilities, and fulfill their responsibilities in an efficient manner.
• Waste Reduction: Food waste is a big contributor to inefficiency in restaurants. Your restaurant staff must be trained on how to minimize waste through proper portion control, storage techniques, and utilizing leftover ingredients creatively.
• Technology Utilization: You are undoubtedly using various technologies in your restaurant. But are your employees using it to the fullest? One way to improve the efficiency of your restaurant is to provide training on the different technologies you use.
• Teamwork and Collaboration: Teamwork and collaboration may be buzzwords, but they’re essential for running an efficient restaurant. They help streamline processes, decrease conflict, and ultimately lead to more efficient operations. Consider how you might implement communication training and team-building exercises.
• Customer Service: Efficient restaurants deliver excellent customer service. Over and over, without fail. Are your staff trained in the art of superior customer service? Will your customers rave over the way they’re treated at your restaurant? 

Obviously, you can’t train your staff on all of these things at once. Focus on one area where you think you’re restaurant is weak and start there. From there, you can branch into other areas. 

Regularly analyze data

As an efficient restaurant owner, you should track your restaurant’s performance through data analysis. This data can be used to identify areas of improvement and make necessary changes in your operations.

What sort of data should you look at? There are many different angles you can take, but here are a few KPIs and key metrics you should be familiar with:

• Sales
• Top menu items
• Restaurant prime costs
• Labor costs
• Food and beverage costs
• Inventory levels
• Customer feedback

By regularly analyzing this data, you can identify trends and patterns that may help you make important decisions. For example, if your labor cost is consistently high, it might be time to reevaluate your staffing levels or shift schedules. Or if a particular menu item is consistently selling well, consider promoting it more or adding variations to capitalize on its popularity.

Advanced analytics like business intelligence and AI forecasting can help take the guesswork out of decision-making. It can remove siloes and bring all your data together into a single dashboard, providing you with insights you wouldn’t have access to otherwise.

Motivate your staff

Some elements of restaurant efficiency are caught more than taught. One of these elements is motivation.

Motivated employees tend to be more efficient, productive, and overall happier in their jobs. They strive to do things at a higher level than unmotivated employees. They care about delivering the best possible experience to customers.

But how can you motivate your restaurant employees?

Here are a few ideas:

First, work to create a positive work environment with open communication. Respect your employees and communicate openly with them about their work, listen to their ideas and feedback, and recognize their efforts and accomplishments. This will create a sense of ownership and belonging among your staff, leading to increased motivation.

Also, provide opportunities for growth and development. Few things are more demotivating than feeling like there is no room for career growth. Offer training, skill-building, and promotion opportunities to your employees. This will not only motivate them but also lead to a more skilled and versatile team.

Additionally, provide competitive pay and benefits. The reality is that money motivates. If you pay your employees poorly, you should expect to get poor results and unmotivated employees. On the flip side, when you compensate your employees well they will be motivated to give their best.

Finally, regularly show appreciation and gratitude to your employees for their hard work. This is one of those small things that goes a long way. Even a simple “thank you” can show employees that you notice the effort they put in. You shouldn’t be stingy with your pay OR your gratitude.

Remember, a happy and engaged staff translates to better customer service, which in turn leads to increased sales and overall efficiency.

An efficient restaurant is a successful one

It’s not an overstatement to say that the success of your restaurant hinges on your efficiency. If you can consistently deliver an outstanding customer experience while also maximizing profits and minimizing costs, then you are well on your way to running a successful restaurant.

Restaurant efficiency shouldn’t be thought of as a one-time thing. Rather, it’s a process of continuous improvement over time. It’s an upward cycle of ever-increasing efficiency.

Don’t be discouraged if your restaurant is not as efficient as it could be. With concerted effort and commitment, you can improve your operations and increase your restaurant’s efficiency. Choose one of the areas specified in this guide and focus on it alone. Once you’re seeing success in that area, move on to another.

Before you know it, your restaurant will be a finely-tuned, highly efficient operation.