The cost of flour is set to skyrocket. According to the executive officer of the Baking Association of Australia (BAA), Tony Smith, major flour mills have reported a $220/tonne spike in the price of the bakery commodity. The cause? A flour shortage. The majority of our wheat is being exported overseas, forcing our market to dramatically increase the price of flour. Given this, now is the perfect time to start making cost savings for your bakery business and we've got a helpful few tips on how to do this:
1. Watch your waste. Wasting food is like throwing money directly into the bin. If you want to save costs in your bakery, start in your kitchen. Make sure that you have a preparation list that shows all the products you need to make for the day, including the raw ingredients and their exact measurements. This way, you can prevent your staff from overproducing goods - which could lead to waste when not sold.
2. Rethink your product offerings. Eliminate the products that aren't selling and focus on the ones that are popular and get repeat orders. This will help you prevent possible wastage and it will also free up staff time and significantly save on labor costs.
3. Cut down on staff. Do this especially if it’s slow or non-peak season. Having five staff members to fulfill orders when only three will do will be costing you time and money.
4. Trim supply costs. Consider sourcing your raw ingredients (e.g milk, eggs, butter) from low-priced suppliers or ask your current suppliers for discounts. A lot of businesses happily provide product discounts to their loyal customers. And it's just as important that you maintain a good relationship with them - communicate regularly and pay them on time to earn their trust.
5. Seek efficiency through digital hospitality systems. Tools like inventory software and order management systems can automate most of your repetitive admin tasks, such as order collection and invoice generation, saving you hours of work and giving you a little extra money in your pocket. As Tony Smith of BAA says, faxes are now a thing of the past so the next best idea is to incorporate automation to make order collection easier for bakeries.
In business, money is power and it's how we keep score, which is exactly why cost savings should be one of the first things you look at when external factors hit. Eliminating waste, decreasing your product offerings, cutting down on staff and supply costs, and using effective tech solutions will all help you ride out this price hike.
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