Areas to Save versus Splurge in a Restaurant Business

restaurant business

One of the biggest challenges of running a restaurant is maintaining good cash flow. Hence, to keep the business on top of its finances, here are the best aspects to save and splurge.

Knowing when to save versus when to splurge is rarely an innate skill for restaurateurs. Nevertheless, it should come with experience, regardless of the size or type of restaurant you own. To get a head start on optimising your finances, here are the best ways to save money, as well as the best areas to splurge on.

When to save


Reducing your food waste is one of the best and most efficient ways to tighten your cash flow. There are several ways to go about it:

  • Avoid overbuying ingredients
  • Be strict with the FIFO method
  • Train staff to minimise food waste and maximise the edible portion of ingredients
  • Use “unusable” ingredients in other recipes (e.g. turn stale bread into croutons, overripe fruits into jams, mushy tomatoes into pasta sauce, etc.)
  • Tweak your menu to ensure maximisation of ingredients
  • Use digital inventory software to aid forecasting and minimise wastage
  • Store food properly to avoid spoilage
  • Buy from local suppliers

Restaurant design

With the right guidance and resources, restaurateurs will be able to achieve a well-designed establishment without breaking the bank. While using high-quality material is the golden standard, it doesn’t have to be expensive. Instead, hit the right balance between quality and price. More importantly, negotiate with suppliers and look for secondhand sources until you can score a good deal.


Usually, it’s the low-cost items that often get thrown out without a second thought, such as reusable plastic zip bags, plastic food gloves, and other types of disposables. However, even if a single piece barely costs anything, it can still add up. Save money and reduce waste by minimising your use of disposables. Moreover, train staff to maximise the use of every disposable item that they take out of the package.

When to splurge

restaurant cooking

Energy-efficient equipment

Outdated kitchen equipment uses more energy than necessary to operate, which can raise your overhead significantly. If your kitchen appliances are no longer as efficient as it should be, invest in newer, more energy-efficient models to reduce both utility and maintenance expenses.


Your business depends on your people, so it is only natural that they are one of the best aspects to splurge on. Here are some of the best ways to invest in your staff:

  • Pay for training and cross-training
  • Increase the pay scale to keep and motivate staff
  • Use bonuses to incentivise top performers
  • Hire new people to avoid short-staffing
  • Offer higher salaries to take on better talent

Digital devices

Displays, signage, table tents, and menus are expensive to produce. With digital devices, you can not only appeal to tech-savvy diners, but you can also save money on collateral expenses and help reduce your establishment’s waste.

Saving and splurging go hand in hand. When you save money on certain aspects of the business, you can put more funds into a worthy investment. And when you splurge on the right things, you can increase your profits and save more money at the same time. That said, saving and splurging should be planned together—not separately—to better reap the rewards.

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