Food Costs, Labor and Sales Research Paper

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At the same time, they could be giving customers greater amounts of free items than are necessary (i.e. napkins, paper cups and plastics utensils). This is problematic, because it means that the underlying costs for these items will begin to increase exponentially. At which point, the expenses for food and other items will skyrocket. Given the fact that they are up so much, this is a sign that this is what is occurring. As a result, managers need to be able to control the amount of food that is being thrown away and how condiments are dispersed to customers. If they can be able to achieve this objective, this will help to reduce these costs. This is when the underlying profit margins of the restaurant will begin to increase. (Brown, 2003, pp. C4-1 -- C4-16)

The lack of skilled labor is an indication that managers may not be paying enough for select positions on the staff. This is troubling, because it means that those individuals who have experience in working in the industry will more than likely find employment with competitors. Once this takes place, the overall quality of the food will begin to decline. This is when the attributes of the products and services will change, which will have an adverse impact on the organization. Over the course of time, this will affect the reputation of the establishment. To deal with these challenges, managers need to seek out those individual who are more skilled and offer them better forms of compensation. This will help the restaurant, to address issues surrounding the quality of food and the kinds of services that are being delivered.

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(Brown, 2003, pp. C4-1 -- C4-16)

The factors more than likely had a negative impact on sales. At the same time, the establishment could have prices in comparison with competitors. These elements are important, because they mean that many customers will begin going to other restaurants. To address this issue, management needs to focus on reducing prices. The best way that this can be achieved is by comparing what customers are spending on the same product with competitors and then coming in below them by at least 15%. This will help to bring in new customers based on the lowest costs they are paying. While at the same time, there must be an emphasis on offering quick service and ensuring that the establishment is clean. Once this occurs, it will help to improve sales and the image of the company. (Brown, 2003, pp. C4-1 -- C4-16)

Clearly, the restaurant that we are examining has the ability to deal with the above mentioned issues. This will require managers to: control food waste, have a better compensation structure for skilled employees and reduce prices on the menu. If they can focus on these different factors, they will be able to improve the overall quality of products and services that are being provided. This is the point that their profit margins will increase and their image will change for the better in the community......

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