Despite recent news of falling prices, controlling costs remains a top priority for foodservice operators. The fact is that wholesale food prices are still on pace for their highest growth in three decades, according to the National Restaurant Association.

With diners tightening their budgets in the face of mortgage struggles and job losses, the most obvious solution for offsetting costs—raising menu prices—is off the table for many operators trying to attract and keep as much business they can muster. So foodservice managers are finding other ways to trim expenses. By reducing waste, maximizing buying power, and yes, even reducing portion sizes (assuming there is still a perception of value for diners), operators are showing that they can remain true to their business goals and respect customers’ bottom lines at the same time.

College and university dining programs often have to be creative when it comes to cutting costs, given that revenues for the school year are essentially locked in when students sign up for their meal plans. The Okemos, Mich.-based National Association of College and University Food Services (NACUFS) reports that many schools are making menu substitutions, signing up for group-purchasing plans and scaling back operating hours in response to rising food prices. But one of the most popular and successful recent tactics has been going trayless.

Foodservice managers find that when trays are eliminated from all-you-can-eat dining halls, diners take less food and therefore waste less. In a study released this summer, Philadelphia-based Aramark Higher Education reported that schools saw a 25% to 30% drop in food waste per person when trays were removed.

In addition, the move cuts back on overhead, because there are no purchase or ongoing replacement costs for trays, says Tom Post, president of campus dining for Gaithersburg, Md.-based Sodexo, which manages foodservice programs on more than 600 campuses. Many Sodexo campus accounts already have retired their trays.

The practice has eco-friendly benefits as well. Besides helping cut food waste, not having to clean trays means water and energy savings and reduced use of chemicals.

Central to the success of any program is diner buy-in. Another Aramark survey found that 79% of students, staff and faculty would support trayless dining. And many student groups with an interest in sustainability are pushing for the trayless switch on their campuses. Noting this, Aramark estimates that half of its 500 campus partners will be trayless by spring 2009.

More and more, independent restaurants and multi-unit operators are exercising strength in numbers when it comes to purchasing food and supplies. By joining purchasing co-ops, they can leverage their buying power as a group, as hospitals, hotels and schools have done.

The Common Market Restaurants multiconcept facility in Quincy, Mass., is one of several Boston-area operations to recently join the Rochester, N.Y.-based Dining Alliance, which oversees buying groups in six East Coast markets. “In this economy, [even] when costs are going up on utilities, insurance, overhead and food, I don’t want to raise prices for my customers,” says Common Market owner Greg McDonald. And because it’s difficult to increase foot traffic now, McDonald says, two money-saving options remain: reducing labor or cutting purchasing costs.

Common Market Restaurants, which operates three restaurants and a food court, has been able to shave 10% to 20% off its coffee, produce, soft drink, paper and packaging costs in the year since the 200-unit Boston group launched.

McDonald also appreciates the level of control members retain. An advisory board of restaurant owners approves vendors, and each operator deals directly with suppliers with regard to deliveries and invoices. Dining Alliance also regularly audits vendors to ensure that prices remain competitive.

“Under the program, a lot of restaurants are able to upgrade to a better-quality product,” says John Davie, president of the Dining Alliance, which plans to launch a group in Phoenix next.

Paring down portion sizes without turning off diners is a tricky proposition. But quick-service chains, to which consumers tend to remain loyal in tough times, have a bit of wiggle room, and some are cautiously exploring portion trimming as a way to offset higher food costs.

Oak Brook, Ill.-based McDonald’s, recently altered its Dollar Menu—swapping the popular Double Cheeseburger (with two hamburger patties and two slices of cheese) for the new McDouble, which has two patties but only one slice of cheese. (The price of the Double Cheeseburger is expected to rise to around $1.19.) Larry Miller an analyst at New York City-based RBC Capital Markets has estimated that the McDouble would cost 6 cents less to make, helping McDonald’s lower its food costs and increase cash flow by $15,000 per year.

According to news reports, one of McDonald’s top competitors, Miami-based Burger King, also has experimented in several markets with offering a smaller-size burger patty in its $1 Whopper Junior.

Large chains aren’t the only ones scaling down portions. Ken Toong, dining-services director at the University of Massachusetts in Amherst, Mass., says his operation’s “Small Plate, Big Flavor” initiative has been surprisingly successful. The program serves up smaller (3- to 4-ounce instead of 6-ounce) helpings of center-of-the-plate proteins such as chicken breast (above) or Alaskan salmon but with bolder Mediterranean, Latin American and Southeast Asian flavors, as well as more high-quality vegetables. Since the program began, the cost per meal has dropped 10 cents to $2.33. “Students are looking for healthier options,” Toong says. “With the rising food costs and demand for world flavors, this turns out to be just want the doctor called for.”

“Restaurants aren’t just counting pennies at this point; they’re counting half-pennies,” says Jim Balis, president of The Restaurant Management Group, a New York City-based turnaround-management company that advises restaurants on cost-cutting strategies and coaches them out of financial trouble. Balis offers three broad strategies for operators in all sectors.

1. Train managers to be cost-conscious. Make sure they understand the concept of controllable expenses and the importance of talking with staff about preventing problems such as excessive napkin giveaways and the inadvertent disposal of silverware. The key, says Balis, is to “develop managers because that’s how [these practices] trickle down to ancillary staff.”

2. Tie bonuses to savings. Another tactic that Restaurant Management Group has found worthwhile is offering heavily weighted bonuses to managers. Discuss with managers in advance what the key indicators will be; for example, if china costs are high, decide that for the next two quarters, manager bonuses will be based on reducing the number of replacements.

3. Improve the guest experience. Balis notes that many chain restaurants are relying more on “eatertainment” to help improve the guest experience. This strategy, which could involve assembling ice-cream sundaes tableside rather than in the kitchen, engages customers (as well as servers) at no extra cost.

Contact writer at kelly.killian@reedbusiness.com