Whether you’re running a new restaurant or an older one, it’s critical that you understand how to control your costs. In fact, the biggest reason restaurants fail is because restaurant owners or managers don’t take the necessary steps to keep food costs in check.
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, storage, handling, service, and payment. Failure in any of these areas can result in rising food costs, which is why restaurants fail.
Forecast
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 gone bad or expired. Order too little and you will run out of items and lose sales.
One of the responsibilities of restaurant owners and managers is to keep records of their 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’ll 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 it will create a database of past performance that can be used for your forecasts.
tidy
You need to know who you order all of your stock items from, so when you place your order, you’ll sit down and write a purchase order for each supplier. Do this even if you are not submitting the purchase order to the supplier.
Many vendors will take your order over the phone or allow you to order online. The written purchase order can be used when you place that order.
reception
One step that many restaurant owners overlook is having set times for deliveries. As a restaurant 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 arrives, the person accepting the delivery can use the purchase order they prepared to compare what was ordered with what was delivered. Eliminates a lot of guesswork.
Make sure the person receiving the items counts and weighs everything that comes out of the delivery truck. Make sure he is really getting what he is paying for.
Storage
First in first out. That is the cardinal rule for food storage. It means that the first thing in the storage area is the first thing out. That means you need to rotate your stock when you receive deliveries.
When you get that fresh case of steaks, you want to make sure the steaks already on the walk-in are moved to the front of the shelf and the newer items are placed behind. Make sure the proper rotation is done each time.
You should also make sure that you date everything that is stored. You need to pay attention to those dates so your food doesn’t expire before it’s used.
Driving
That step where most of the cost of food gets out of control is in the handling step. That’s where your cooks prepare food for service or for later use. This is where training is critical, but too often overlooked.
If your cooks don’t know how to trim and cut the meat they’re working on, too much will end up in the trash. If food is left out too long, it will spoil more quickly. If menu items are not prepared properly, they will not be served and will end up being thrown away.
Train your staff on how to read and follow recipes and procedures, then inspect their work to make sure they’re doing what they’re supposed to.
Service
Make it a policy that nothing leaves the kitchen unless you go through the proper ordering procedure first. If you are using a POS system then nothing ever gets ready without the proper voucher or receipt.
Don’t let your servers get away with running to the kitchen claiming they need the cooks to make something on the fly with the promise they’ll call you when they get the chance. Those meals may end up at a friend or family member’s table, and you won’t see a penny for it.
receive payment
If you have a good meal ordering procedure, this step takes care of itself. It’s still a good idea to periodically check random items to make sure procedures are being followed.
Pick an item to track at the beginning of the day to track. Count that item, then count again at the end of the service period. Compare the number of missing items to the sales receipts for the day. If the procedures are followed, the numbers should match.
To avoid the top reasons restaurants fail, learn how to control your food costs. Whether you are a restaurant owner or manager, 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 grow.
