The Best Way to Cut Costs

You know the celery and carrots that usually come with a typical order of chicken wings?

I recently visited a restaurant that charged extra for them.

And I loved that.

You see, I happen to dislike both celery and carrots.*

When asked if he wanted a salad, a friend of mine once said, "I don't eat what food eats."

I'm not quite that extreme, but when I order a plate of wings, what I want are the wings.

In fact, when I order wings at a restaurant, I'll usually tell the server that the restaurant can save themselves the cost of the veggies and just bring me the meat; when I forget to let them know, the veggies are still there when the server clears my plate.

Restaurants build the cost of the celery and carrots into the price they charge whenever customers order a plate of wings.

But costs have continued to increase over the past few years, and most businesses have had to pass along those increased costs in the form of higher prices.

This restaurant I visited did something smart. Rather than increasing the total price of the wings on the menu, they kept the price the same but lowered their food costs.

And they lowered their food costs by eliminating the celery and carrots, which I'm willing to bet most people won't miss very much.

The people who do enjoy the traditional veggie accompaniment when they order their wings have the option of adding them back to their plate for a nominal incremental charge.

But those people have helped the restaurant turn an expense into a profitable upcharge.

The best way to cut costs is to eliminate the things that most of your customers won't miss.

The worst way, of course, is to make cuts that negatively impact your customer's experience with your brand.

That would include cutting travel budgets for your sales teams when it impacts their relationships with your clients, laying off call-center staff when it means your customers have to wait longer to get their issues addressed, using noticeably lower quality materials in the products you sell so your consumers think less of your brand...

... and I'm sure you could think of many more examples if you tried.

* Strangely, though, carrot cake is my very favourite cake. Yes, I'm a complicated man.