Successfully running a restaurant requires operators to keep tabs on many different areas of the business, but maintaining profitability is at the top of the list—and staying profitable requires a detailed food cost and inventory control strategy.
But optimizing food costs and inventory management doesn’t have to be a full-time job. For optimal cost management and organization, operators should consider these four tips.
1. Monitor high-cost ingredients
Engineering profitable menus is key when trying to manage food costs, and part of that involves making sure that food is going where it needs to be going. In other words, it’s important to keep track of loss—monitoring how much food is ordered, delivered and used/sold is paramount.
It’s also important to monitor inventory and output, particularly with high-cost ingredients, as well as track user-specific behavior to reduce any dishonest behavior. For instance, security cameras above bars can help ensure drinks aren’t being over-poured—a big loss-leader.
2. Employ demand-based production
Ensuring food costs are optimized is also reliant on waste reduction. Reducing waste can be as easy as forecasting your food production schedule based on demand. For instance, brewing a big pot of coffee in the afternoon might lead to a lot of wasted coffee, as demand is much higher in the mornings. Likewise, consumers might be more interested in certain dishes/foods on certain days.
Using back-of-house restaurant software can help operators keep tabs on these patterns and can help minimize waste. These reports can also help staff plan for what needs to be prepped going into different shifts and days.
3. Utilize technology to ensure everything is in its place
Continual inventory management goes hand in hand with demand-based production. Limiting waste means only purchasing what your restaurant needs at a given time, and that means always knowing what needs to be ordered—and, perhaps more importantly, what doesn’t. Maintaining optimal inventory levels means reducing excess inventory waste and avoiding “out of stock” incidents which can lead to on-the-fly menu readjustments and even worse—potentially unsatisfied customers who were looking forward to enjoying a certain menu item.
Monitoring inventory can be especially difficult if it’s all done manually or if some items are stored in more than one place, making software an easy way to streamline operations. Web-based solutions help maintain real-time tracking, which eliminates data entry errors and helps prevent running out of ingredients or supplies unexpectedly. Inventories can be scheduled to take place at any interval that’s best for a restaurant and can be coordinated by corporate offices, area managers or store managers, depending on user permissions in the software being used.
4. Control vendors, products and prices of items
Finally, operators should streamline the way they order their food and supplies. Particularly with franchises or chains, it can be helpful to ensure brand consistency by controlling which vendors are utilized, which products are purchased and what prices are deemed acceptable for the business. Negotiating the best prices can help manage food costs across locations, and using software to track where products are bought from and when can help with finding the best vendors and prices as well—operators will know at a glance when new product is needed and can order in advance for the best price, rather than having to quickly order from the first available vendor in the event of an emergency out-of-stock situation.
CrunchTime is the one and only BOH technology platform for the entire operation
- One daily playbook for the restaurant operator to run the entire business, including forecasting, ordering, receiving, inventory, payroll, and team scheduling.
- One cost analysis console for the procurement team to scrutinize spend, compare vendor bids, negotiate contracts, set up lot tracking, and manage vendor performance… and slash food costs in the process.
- One nutritional console for the culinary team to evaluate menu item nutritionals, perform recipe modeling, and manage one online recipe book.
- One operational analysis console for the leadership team with all key performance metrics aggregated onto one master scorecard, and drill-down to each region, restaurant, transaction, and manager.
- One standard to centralize and protect the brand by ensuring operational standards, from recipe prep to scheduling practices, are upheld throughout corporate, franchise and global locations.
Get the one and only CrunchTime! Request an online demonstration at CrunchTime.com.