How Top Chefs Break Down Food and Labor Costs

When you’re running a business, you surely keep tabs on costs to get an idea of the profit that your company takes in from its work. While there are many areas in which to save, the two primary expense categories in catering are labor and food.

Let’s take a look at some ways you can save in both of these categories. 

Labor Costs

While you can’t always sacrifice the quality (and, therefore, cost) of ingredients, you can be more efficient with labor so that you can make the most out of your workforce without breaking the bank.

Meryl Snow of SnowStorm Solutions agrees: “In 2008, when the economy crashed we had to brainstorm on how to keep costs down. As labor is the largest cost we'll start there.”

 In most cases, you don’t need to fire anyone in order to save on labor costs — it’s simply a matter of being more prudent. Start by being more strategic with your team’s schedule. Analyze their pay rates alongside your upcoming events to see you can schedule them accordingly.

“We stagger staff on large events so lower paid staff work more hours vs higher paid staff,” explains Lon Lane of Lon Lane’s Inspired Occasions. “For example: Chefs get the food out, clean up and leave....lower paid staff stay, breakdown, load vans and return to commissary to unload vans, clean and put away items for the next day.”

In that, you should have a good idea of how your events typically flow. When do you need the most help? For the times that it feels like all hands on deck, consider scheduling a full team’s effort and scaling back as the day goes on and responsibilities become less strenuous.

“One thing we found is that we throw a bunch of extra staff at larger events at the beginning of the event,” says Adam Gooch of Common Plea Catering. “Big motivation on getting things set and ready in a much timelier fashion. Then we start either moving staff back to commissary, other events, and or finished for the day. I feel that guests’ experiences is what makes you better so having a full team to get things served quickly and correctly does make a difference.” 

Food Costs

In terms of food costs, you want to start by looking at your menu and the price points that go along with your dishes. Ensure that all of your meals bring in a profit — breaking even isn’t enough to pay your employees, so you might need to consider scaling up on prices.

If your pricing is in line with your market and you still need to slash costs to increase your bottom line, start looking at the sources for your ingredients. Shopping for food locally can be a cost-effective alternative, as you don’t need to accommodate the overhead of shipping and storage. Better yet, take it up a notch by getting to know your local farmers and butchers — having a personal relationship with your food suppliers can go a long way in saving costs.

It can also help to review your menus and separate your star dishes from your backup dishes. Those meals that are popular and most requested deserve the highest quality ingredients because people notice them; supporting dishes, like sides, salads, or sauces, can likely pass without top-of-the-line ingredients.

Whether you’re seeing a decline in revenue or simply want to streamline your company further, look to your labor and food costs for the most significant opportunities for saving money. As you find more efficiency in your company, you’ll create additional room in the budget that can be invested back in the business for continued growth and improvement.