Everyone Eats The Guide To Making Club Food And Beverage Profitable

EVERYONE EATS
MAKING F&B PROFITABLE

A common sentiment we remind our clients is, “Everyone eats!”

Customers and club members may not use all the amenities at their club, but all of them will frequent the dining room, grille, or halfway house, arguably making this the most utilized amenity at every club.

However, managing a successful and profitable food and beverage operation at any club can be extremely challenging and complex. High staff turnover, runaway costs of sales, and increased labor expenses can lead to significant financial losses. Except for a very few high-end properties, Bobby Jones Links successfully generates profits in food and beverage at our clubs, with some achieving profit margins as high as 25% after other supplies and costs are considered.

HOW TO MANAGE COST OF SALES

Rounds and participation continued to outpace pre-Covid levels, Effectively managing cost of sales is essential to maintain a balanced ratio of 28% to 40% of revenue, depending on the type of operation. Here are the key strategies we recommend and employ to achieve this goal:

Establish Standardized Recipes

Develop and document standardized recipes for all menu items to ensure consistency in portion sizes and ingredient quantities. This reduces food waste and controls costs.

Continually Manage Your Inventory

Implement a robust inventory management system to track ingredient usage, monitor stock levels, and identify discrepancies. Regular physical inventory counts maintain accuracy, prevent theft, and minimize spoilage. When a club’s cost of sales is too high, do daily inventory counts until it is corrected.

Build Supplier Relationships and Negotiate

Build strong relationships with suppliers and negotiate favorable pricing terms. Our procurement program and buying power enable us to explore bulk purchasing, seasonal specials, and sourcing directly from local producers to secure the best possible prices for ingredients.

Analyze the Menus

Analyze the menus to identify high-profit and low-profit items. You can increase profitability by promoting high-profit items and reworking low-profit ones. Popularity, ingredient costs, and pricing should be carefully considered when making menu adjustments.

Offer one high-priced item (anchoring) to make the others seem more reasonably priced.

Use common ingredients in dishes to reduce inventories and spoilage.

Regularly Update the Menus

Periodically review and update menus to reflect changing food costs and market trends. Removing underperforming items and introducing new, profitable options keep the menu fresh and appealing to customers.

Minimize Food Waste

Strategies such as proper storage techniques, utilizing trimmings in other dishes, and tracking and analyzing waste patterns help us minimize food waste.

Provide thorough training to kitchen staff to handle and store ingredients properly, preventing spoilage.

Offer Menu Specials and Limited-Time Offers

Introducing specials or limited-time offers helps us utilize ingredients nearing expiration and promote slow-moving inventory. This reduces waste and boosts sales.

Train for Portion Control

Train kitchen staff on portion control to prevent over-portioning and excessive waste. Consistency in portion sizes ensures cost control and reduces unnecessary food expenses.

Implement Ongoing Cost Analysis

Regularly review food costs and monitor key performance indicators (KPIs) such as food cost percentage, gross profit margin, and menu item profitability allows us to identify trends and areas of concern. This enables you to take proactive measures to address them. Bobby Jones Links employs a proprietary cost of sales tracking software to monitor this.

Train Staff To Upsell More Profitable Items

Reward staff for selling higher margin items such as certain desserts, specials, a special cocktail or afternoon mimosa, etc.

HOW TO MANAGE LABOR COSTS

Acceptable labor costs should range from 30% to 42% of sales, depending on the type of establishment and mix of a la carte and catered events. What follows are the key strategies you should use to reach this goal:

Optimize Staff Scheduling

Optimize the staff scheduling by aligning labor hours with anticipated customer demand.

Use historical sales data, trends, and seasonal variations to forecast busy and slow periods.

Ensure adequate coverage while minimizing unnecessary labor costs by avoiding overstaffing during slow times and understaffing during peak hours.

Cross-Train To Multitask

Cross-train the staff to handle multiple roles and tasks, allowing for efficient deployment of employees and avoiding excessive labor costs. For example, servers can also assist with hosting, or line cooks can handle prep tasks during slower periods.

Forecast Labor Costs

Develop labor forecasting models based on historical data and anticipated business trends.

Analyze point-of-sale system data, monitor tee sheets and activity tools, and closely watch the weather to estimate required staff levels and prevent overstaffing or understaffing accurately.

Streamline The Processes

Identify opportunities to streamline operational processes and eliminate inefficiencies. This includes optimizing kitchen workflows, reorganizing workstations, and implementing technology solutions like POS systems or self-ordering kiosks to expedite service and reduce labor time.

Train and Develop The Staff

Invest in staff training and development programs to enhance skills and productivity. Well-trained employees are more efficient, reducing the need for additional labor. Training should focus on service standards, time management, and efficient work practices.

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Monitor The Staff’s Performance

Regularly monitoring and evaluating staff performance, setting clear expectations, and providing feedback help improve efficiency and productivity.

Recognize and reward high-performing employees to boost morale and encourage excellence.

Track Labor Costs Religiously

Implement a robust system to track and analyze labor costs.

Develop key performance indicators (KPIs) such as labor cost percentage, sales per labor hour, and labor cost per customer are regularly reviewed to identify deviations, trends, or areas for improvement.

Bobby Jones Links has proprietary labor tracking software we use to monitor this.

Limit A La Carte and Fine Dining

Whenever possible, limit a la carte and fine dining options and replace them with themed events and parties, which are more profitable and enjoyable for club members.

Everyone eats!

But not every club has to suffer losses in food and beverage.