How a food business can cut costs without compromising quality

Dear Nanay,

I read your article a few weeks ago about Sara, who owns a laundry and wanted to raise prices or change their detergent.  We have a similar problem.  We own a small restaurant and are deciding whether to raise prices or change our ingredients.  Our other option is to make the size of the dishes a little smaller.  What do you think we should do?

May

Dear May,

As in Sara’s situation, I would be very careful about changing your ingredients.  Pareho iyan doon sa pagpalit nila ng detergent.  (That’s the same as them changing their detergent.) Your ingredients are such a vital part of your final product that changing them might result in an inferior final product.  In your case, baka mag-iba yung lasa o baka naman maging matigas yung karne (the taste of your food might change or the meat might become tough).  That is a big risk to take because it might dissatisfy your customers.

As you said, a better option might be to make the dishes a little smaller.  And to make up for the smaller portions, maybe you can add something else to the dish that costs less than the main dish — like soup or a small salad. 

Or you can make a “meal of the day” where you can bundle the entrée, some rice, soup or salad, dessert and a drink and charge a discounted price versus if the customer orders all the items separately.  Customers will like it because they get a discount.  But for you, even if it is discounted, you might be able to actually make more money because the total purchase of the customer will be a bigger amount than if he just ordered rice and the entrée.  Tumaas yung binili ng customer kaya kahit na mas maliit yung pursyento na kinita mo, mas malaki naman yung peso value.  At siyempre, mas malaki yung pera na napaikot mo. (He purchased more so even if the percentage of your profit is small, it’s higher in peso value. And of course, you have more money to turn over.)

It is very difficult for me to make specific suggestions because I do not know the way you operate your business.  Look at your entire operations and see where you can save some money and cut costs.  And then balance that out with raising prices a little bit.  You know your business and your customers best and you will have to do some pencil-pushing to figure out which options are best for you and most acceptable to your customers.

Sincerely,

Nanay

* * *

Editing The Lengthening Christmas List

Dear Nanay,

Every year my Christmas list of people to give gifts to gets longer and longer.  That means I have to stretch my budget more and more each year.  But when I think about it, there are some people on my list who I am not that close to anymore and don’t even send me gifts anyway.  Can I take them off my list already so that I can spend more on the people I care most about?  Or should I keep them on my list?

Michelle

Dear Michelle,

First of all, I think we need to look at the spirit behind gift giving.  Bakit ba talaga tayo nagreregalo? (Why do we really give gifts?)

To show your love and appreciation for someone?  To say thank you for a year of friendship?  To share your blessings with someone less fortunate?  Any of these could be a good reason.  But I hope it is not so that you can get a gift in return also!  Hindi naman tama iyon! (That’s not right!)

So when you are asking if you should remove someone from your list, why don’t you ask yourself why you are giving them a gift in the first place.  Bakit mo nga ba rineregaluhan yung isang tao?

Look at your reason, then you can decide if you are giving a gift for the right reasons.  If you can’t find a good reason to give a gift to that person, then maybe it is time for you to take him off your list. 

Or better yet, maybe you can just lessen your budget for those people instead of taking them off your list completely.  Send them a greeting card instead.  Give them a phone call to personally greet them.  Who knows?  That simple phone call might lead to lunch or dinner and a rekindled friendship.  And then you will remember why you were sending them Christmas gifts in the first place.

Sincerely,

Nanay

* * *

If you have a question, e-mail us at asknanay@nationalbookstore.com.ph or just drop your letter at drop boxes in all National Book Store branches nationwide.