Whether you are running a new restaurant or an older restaurant, it is critical that you understand how to control your costs. In fact, the biggest reason why restaurants fail is that the restaurants owners or managers don’t take the steps to keep their food costs under control.
In order to control your costs you need to pay attention to the 7 steps in the food cost control cycle. These steps are: forecasting, ordering, receiving, storing, handling, service, and payment. Failure in any of these areas can result in your food costs going up, which is why restaurants fail.
Before you place your food order, you need to know how much food you will need to order. Order too much food and you risk losing food because it has spoiled or expired. Order too little and you will run out of items and lose the sales.
One of the restaurants owners and managers responsibilities is to keep records of your operation. By looking at past sales records you will be able to predict how much food you will need. By looking at your sales for the week before Christmas last year, you will get a good idea of what to expect for the week before Christmas this year.
This step can be difficult for new restaurants, but over time you will build a database of past performance that can be used for your forecasting.
You should know who you order all of your stock items from, so when you do your ordering you will sit down and write up a purchase order for each supplier. Do this even if you are not submitting the purchase order to the vendor.
Many suppliers will take your order over the phone, or they will allow you to place the order online. The written purchase order can be used when you place that order.
One step that many restaurant owners miss is to have set times for deliveries. As the restaurants owner or manager you have the right to set an acceptable window for deliveries. This is important because if you know when your deliveries are expected, you can have a trained person available to accept those deliveries.
When the delivery comes the person that is accepting the delivery can use the purchase order that you prepared to compare what was ordered with what was delivered. It removes a lot of the guess work.
Make sure that the person that is receiving the items counts and weighs everything that comes off of the delivery truck. Make sure that you are actually receiving everything you are paying for.
First In – First Out. That is the cardinal rule for food storage. It means that the first thing into the storage area is the first thing to come out. That means that you need to rotate your stock when you get deliveries.
When you get that fresh case of steaks, you need to make sure that the steaks that are already in the walk-in get moved to the front of the shelf, and the newer items are placed behind it. Make sure that proper rotation is done every time.
You should also make sure to date everything that goes into storage. You need to pay attention to those dates so that your food does not expire before it gets used.
That step where most food cost gets out of control is in the handling step. That is where your cooks are preparing the food for service, or to be used later. This is where training is critical, but is all too often missed.
If your cooks do not know how to trim and cut the meat they are working on, too much will end up in the trash. If food is left out too long it will go bad more quickly. If menu items are not properly prepared they will not be able to be served, and will end up being thrown out.
Train your staff how to read and follow recipes and procedures, then inspect their work to make sure they are doing what they are supposed to do.
Set a policy that nothing leaves the kitchen unless it is first rung through the proper ordering procedure. If you are using a POS system, then nothing get prepared without the proper chit or receipt.
Do not allow your servers to get away with rushing into the kitchen claiming that they need the cooks to prepares something on the fly with the promise that they will ring it up when they get the chance. Those meals may end up at the table of a friend or family member, and you will not see a dime for it.
If you have a good meal ordering procedure in place, this step takes care of itself. It is still a good idea to periodically check random items to ensure the procedures are being followed.
Choose an item to track at the beginning of the day to track. Count that item, then recount at the end of the service period. Compare the number of items that are missing with the sales receipts for the day. If procedures are being followed, the numbers should match.
In order to avoid the biggest reasons why restaurants fail, learn to control your food costs. Whether you are the restaurants owners or managers, whether you are operating a new restaurant or an established restaurant, the steps to control your costs are the same.
Start controlling your costs today, and watch your profits rise.