Sales declined by 2.4%, costs decreased, yet the gross profit fell by 3.2%. To improve, analyze sales decline reasons, optimize costs further, and focus on strategies to boost gross profit margins like pricing adjustments and menu optimization.
The operational analysis reveals a decline in sales by 2.4%, accompanied by reduced F&B and labor costs, yet resulting in a 3.2% drop in gross profit. To enhance profitability, the restaurant should probe the sales decline's root causes, conduct market research.
While cost reductions are positive, exploring further efficiency avenues like supplier negotiations or staffing optimization can fortify savings. Additionally, focusing on enhancing the gross profit margin through strategic pricing, upselling.
Regular monitoring, balancing cost-efficiency measures with maintaining quality, and strategic adjustments in sales and pricing strategies will bolster the restaurant's profitability and long-term sustainability.
the complete question:
Restaurant manager Sam has just presented the operational results of the restaurant to the owner John. The results are presented in the table below.
| Particulars | Aug 19 - Jul 20 | Aug 18 - July 19 | Change |
| Sales | 3560770 | 3650230 | -2.4% |
| F & B Cost | 1103838 | 1168073 | -5.9% |
| Labour Cost | 1175054 | 1241078 | -5.6% |
| Gross Profit | 1281877 | 1241078 | -3.2% |
Analyze the operational results of the restaurant and provide recommendations to the restaurant manager to improve profitability.