This week we've been looking at the food industry for some small business lessons.
One of the main lessons I was reminded of from my viewing of Kitchen Nightmares and The Chopping Block was how easy it is to lose profit margins. 
In essence, profit margins are about lowering costs and increasing profits. Visiting chef, Gordon Ramsay illustrated this with his tough business approach.
Ramsay changed the menu at Rococo to a set menu, but still with some choices. He changed the food from a high class overpriced menu to good wholesome seasonal, local food.
He cut down on time consuming work processes such as decorative touches. This meant diners didn't wait so long for meals. They were happier with value for money, service and the food.
The restaurant got more return custom. Word of mouth worked in their favor rather than against them. They could pay their bills, manage their budget and turned a profit.... a win win for all.
As shown in the little bakery that drove McDonalds out of town, good business is about being savvy and offering a good product and value for money.
Looking at how to structure realistic profit margins and productivity is a big part of this.
- Any tips for managing profit margins in small business?
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Tracked on: March 19, 2008 9:08 AM | Permalink to Trackback