How To Ensure Your Venue Makes A Profit This Event Season

Event season is in full swing and for Australian venues, the successful delivery of hospitality and events through November and December can make or break the budget. Perfectly Paired Principal Hospitality Consultant Mark Wright knows what it takes to keep venue costs in check.  Read on for Mark’s quick tips to ensure your venue is profitable for this event season and beyond.  

“Failing to prepare only amounts to preparing to fail. The catering operation involves all business facets, from planning, purchasing, recruitment, IT, Finance, but above all it is about the product and the people. Get these two areas right, the rest of the business will look after itself“. – Mark Wright

Staffing

This is one of the largest costs within the operation and it is completely in your control, therefore it is imperative to forecast labour against forecasted revenue. The keys to success are in the area of recruitment and retention.

The best way to structure your resources are to divide them into 3 distinct areas, whether front of house or back of house.

  • Managers
  • Supervisors/ Team Leaders
  • General Staff (wait staff, bar staff, runners, cooks, kitchen hands etc.)

10 % of your workforce will be management and supervisors, these are your key personal and as such you should focus 80% of your training and development on them. These people will make up the cornerstone of your operation and should be confirmed well in advance of each event/ shift. They will lead, organise and train the rest of the team on the day, especially if they have had quality training and detailed briefings on what is expected of them.

Remember variable labour is in your control and should be treated as importantly as food and beverage pricing. There are many effective software management tools on the market that will allow you to stay on top of this.

Menu Planning

A key component to a successful catering operation is in the planning of the menu, ensuring that that product mix is correct with a clear and defined pricing strategy.

Your business can sustain some high COG’s items if they are on the lower end of the scale regarding sales, with your high yielding items to have the best cost of goods sold.

The importance of balance of styles of service in each area that is operated are critical to ensure that you can stay within your agreed margins.

COGS and labour ratios can vary depending on how much product is being made in house, as this will increase the labour cost, but conversely reduce the food cost. If when one goes up the other comes down, your venue or catering business will run soundly.

Suppliers & Produce

Cost of goods are variable and for your venue’s success, ensure that you arm yourself with the knowledge of what quality of product you require and find the best price for that product.

Always double check the price that you are paying is the price that you have been quoted, many mistakes can happen without you noticing, unavailable items not credited correctly, or substituted items incorrectly charged. This can amount to many thousands of dollars per annum.

Ensure that you have a robust check and balance system in place as most of the time the person receiving the order is not the same as the person ordering.

Point of Sale Systems

Your POS can be your best friend, it will help track and manage all items that have been sold in your business, then supply you with a raft of information especially when you are working on new menus and have information at hand as to which products sell when and in what sells in volumes. This can help identify future pricing and promotional strategies.

To grow your retail and commercial event venue sales, increase your profits and manage partnerships in a way that’s smart, streamlined and strategic, it’s time to be Perfectly Paired.

Contact our experienced hospitality consultants today.

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