Effectively managing inventory can mean the difference between success and struggle
In the restaurant business, where every percentage point of profit margin counts, effectively managing inventory can mean the difference between success and struggle. Typically, food costs alone account for 25-30% of total expenses, and when combined with labour costs, they can consume a significant chunk, up to 50-70% of your total sales. To maintain profitability, you need to master the art of cost control.
The Challenge of Managing Food Costs
Managing food costs involves several critical steps, such as standardising recipes, evaluating purchasing practices, and minimising wastage. While these are essential components of cost control, one major challenge often hampers many establishments: the inability to effectively track inventory.
The Core Problems: Inventory Checks, Recipe Complexity, and Variance
Do you dread inventory checks? Is recipe management a complex puzzle? Are you struggling to reflect changes and fix errors? Can you clearly distinguish between theoretical and actual costs?
These are the core issues that can eat into your restaurant’s profits and hinder efficient cost control. And here’s where modern tech can be a game-changer.
1. Inventory Checks: From Chore to Asset
For many, inventory checks have become a burdensome chore. However, they are crucial for evaluating factors that significantly impact your restaurant’s profitability, such as ingredient costs, food preparation efficiency, dish cost, sales volume, and wastage. The challenge lies in ensuring that counts are easy-to-conduct, accurate, consistent with policies, and devoid of errors.
2. Recipe Management Simplified
Calculating the plate cost for any recipe is fundamental to understanding your restaurant’s profitability. But this process can be quite a challenge. It involves not only calculating the cost of recipes, accounting for portions, serving sizes, units of measure, yield percentages, and ingredient quantities, but also managing items, ingredients, and addressing variances.
3. Conquering Inventory Variance
Minimising variance is critical for running a successful food and beverage operation. Variance can result from losses, shrinkage, recipe errors, discrepancies in consignments, theft, and other factors. Achieving precision in your numbers and enabling quick fixes and adjustments is essential.
4. Zeroing Food Cost Control
The ultimate goal in food cost control is to reduce the variance between actual and theoretical costs to as close to zero as possible. This difference serves as a true measure of operational efficiency, indicating how well you manage portioning, breakage, wastage, and shrinkage. However, accurately measuring this metric and identifying trends can be a formidable task.
Embrace Modern Technology
The good news is that modern technology, like Syrve, can help you conquer these challenges. By implementing the right tools and software solution, you can gain greater control over your inventory, simplify recipe management, reduce variance, and enhance food cost control.
In today’s competitive restaurant industry, mastering these aspects is essential to ensuring profitability and long-term success. Don’t let inventory challenges eat into your profits. It’s time to act and embrace the power of modern tech to revolutionise your restaurant operations.
