It’s no secret—food costs are on the rise, and it’s hitting restaurants hard.
In the last year alone, U.S. food prices for restaurants and food-away-from-home businesses have increased by over 5%, with items like eggs, beef, and dairy seeing double-digit increases in some areas. Meanwhile, margins in the industry remain razor thin—typically between 3–6%, according to the National Restaurant Association.
For independent restaurant owners, this means less room for error, tighter budgets, and the need to make every dollar stretch further.
5 Smart Ways to Lower Food Costs in Your Restaurant
Before you raise prices or trim your menu, try implementing these strategies:
1️⃣ Track Food Cost Percentage Weekly
Know your numbers. A healthy food cost percentage is usually between 28–35%. Tracking this weekly (instead of monthly) gives you time to course-correct before it’s too late.
2️⃣ Optimize Your Menu
Use your sales data to identify high-margin items and spotlight them. Consider removing or adjusting low-performing, high-cost dishes that eat up your profit.
3️⃣ Control Portion Sizes
Inconsistent portioning leads to waste—and wasted money. Use scales and standardize recipes to keep things tight and predictable.
4️⃣ Build Strong Vendor Relationships
Negotiate bulk pricing, stay informed about upcoming cost increases, and consider switching suppliers when necessary. Loyal relationships can mean better deals.
5️⃣ Reduce Food Waste
Track spoilage, use FIFO inventory methods, and train staff on smart prep techniques. Wasted food = wasted profit.
How CFO Services Help You Navigate Rising Costs
While these tips help in the kitchen, the real magic happens behind the scenes—with your numbers.
That’s where The Active Ledger’s Restaurant CFO Services come in.
As your financial partner, I help you:
- Identify cost leaks using detailed financial analysis
- Create custom dashboards to monitor food + labor costs in real-time
- Forecast and plan for seasonal or economic shifts
- Improve your cash flow so you’re not stuck in survival mode
Most restaurant owners are running on gut feelings—I help you run on data. Together, we build a roadmap that helps you stay profitable, even when the cost of doing business goes up.
About Me
I’m Kellie Crain, a dedicated bookkeeper and CFO for small businesses and restaurants. I combine financial strategy with hands-on industry experience to help you make smarter decisions, stay profitable, and reduce financial stress. If your restaurant feels like it’s constantly fighting to keep up, you don’t have to do it alone.