Home / PEOPLE / Hospitality Trends / Cost Management's: Many faces

The secret to cost management is to train all your employees to be cost conscious.

Cost management is nowhere more critical than in F&B. Five chefs share their experiences in managing the fine line between profitability and quality.

What is your interpretation of the term ‘cost management’?
Abhijit Saha: For me, money saved is money earned. Managing costs is one of the most important factors that leads to success. It is most relevant today where we are expected to provide value to customers and is best done when we keep costs under control.

Sudhakar N Rao: Cost management should be an interpretation of the number purely based on facts that may or might affect the results of an organisation. However assumptions, estimates and forecasting cannot be ruled out, but a cautious realistic approach will always go a long way.

Story continues below

Advertisement

COMMENT Comment on this article

Sudhir Pai: For me it is a process of constantly monitoring and measuring costs of running the business in order to effectively plan and control decisions that increase value for customers and lower costs of products and services.

Gregory Lobo: It means saving costs everywhere without disturbing quality and safety, be it rooms, food production, service, buffets, maintenance, fuel, manpower and so on.

How have you addressed cost management in this economic environment? What are your biggest cost heads?
AS: Our biggest cost heads are F&B, manpower and rental.

We have started giving more value to our customers rather than going in for big marketing activities which are also being restructured to make them more cost effective. We are also trying to renegotiate prices with our vendors.

On the team front, we are promoting multi-tasking rather than hiring new employees. In the wine list we are also featuring a number of low cost wines of good quality from the new world besides the expensive ones.

SNR: By using effective cost cutting tools such as meeting the necessities and avoiding luxury without shifting the focus on quality of the end product. Priority is in ‘continuing’ rather than in the ‘returns’, at least for a year. Proper and optimum use of all available resources has helped in reducing the running cost.

Our biggest cost heads are real estate rent, salaries, raw material and maintaining the brand.

SP: In these times, every cost has to be dealt with seriously and monitored closely. The big cost heads are energy, payroll and food.