5 Quick Steps To Control Your Fresh Food Costs

Controlling of fresh food is vital for ensuring profitability and avoiding a loss of margin through wastage or poor internal practices.  Consider this, by having €10/day of food waste is equal to €3,650/year at cost value. This means that you have to make an additional €12,166 (at 30% food cost) in top-line net revenue to compensate for this loss. Ouch!

Follow these steps which will ensure that your business is avoiding some common mistakes;

Over ordering – Common practice when those that are ordering are not signing the cheques, or they are not aware of the usage of how often that particular item is sold. Know what you need to order and ensure that you do not stray above that optimal stock level. Ensure that it is communicated to those that order the food items.

Are you wasting food? – Is food being disposed of, or spoiled, before its getting onto the customers plates? Or, are plates coming back with excess food on them? Portions too big? A particular item that customers don’t like? Quantify the amount of waste that is occurring and then multiple it by the amount of days/weeks in the year to get an extent of your real problem.

Know your days stock on hand – This simple metric will tell you if your over-stocked or not. See this previous post on how to calculate it. If you are over-stocked then your business is far more likely to be wasting food.

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Know your margin – Conduct frequent counts of your inventory. This way, you will know your exact food cost. Calculating your margin by dividing purchases by sales and assuming a standard opening/closing inventory value, is simply disguising the truth of poor internal practices. Don’t be lazy!
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Get your team involved – Don’t keep the numbers a secret, make your employees aware of the problem you are trying to solve, this way you are far more likely to solve it and curtail it reoccurring and damaging your margin. Place it in a prominent position in your kitchen/staff canteen.