How to Identify Needless Costs in Your Hospitality Business

Management 8 minute read 05 October 2020

It’s thought that the median cost to open a restaurant stands at just over $3,000 per seat in the US. A hotel? Well, that’ll set you back a mere $115,000 per room for a midscale property.

But what about the on-going costs? Back in 2016, research suggested that hotel operating costs in the UK had risen by a staggering 53%.

average hotel operating costs

This is why keeping tabs on your overheads is critical. Whether it’s business as normal or you’ve encountered a challenge (big or small) that means you need to drastically cut your expenditure, knowing where to make those cuts is vital.

This is a business skill every cafe owner, restaurateur and hotelier needs to know, and we’ve got the low-down on cutting operating costs - sensibly - for two of the hospitality industry’s biggest players.

How to reduce hotel operating costs

how to reduce hotel costs

Good news. If you’re a hotelier, it is possible to reduce overheads without denting the guest experience, upsetting the team or - worse - having to lay any of them off.

How to reduce restaurant operating costs

how to reduce restaurant costs

Did you know that the average restaurant wastes nearly 75,000 pound of food each year?

That statistic really does hit you between the eyes, given how much poverty there is in the world. But, if you run a restaurant, you could be contributing to it - significantly.

Food waste is just one area in which restaurants struggle to keep a hold on their expenditure. Here are some of the best tips we found for reducing the operating costs in a restaurant:

I’m a restaurateur: should we join the delivery movement?


No, really - this is rapidly becoming a question to which there is only one answer. World-wide pandemics, industry disruption and an ever more expectant customer base means home delivery is something every restaurant should get involved in.

As you’d guess, this is a big yet fascinating topic in its own right. Thankfully, we’ve already put together two brilliant guides for restaurateurs who are considering joining the delivery revolution.


Cutting costs isn’t always fun; there’ll be suppliers you realise you no longer need and, consequently, a few noses out of joint by the end of it, but, sometimes, your hand is forced.

Equally, cost cutting can be an enjoyable experience. Once you identify those overheads that are completely needless, you’ll discover how much additional cash you’ll have in the bank account each month. And cash remains king - never forget that.

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