Restaurant Operations – Cost Control Tips

A restaurant is not a thing. It is not a structure. It is not a group of people. It is not a recipe, concept, or a brand. It is a process that brings product and people together to create a pleasant experience for your guests and profits for the owners. To deliver that pleasant experience and at the same time ring in profits for the company, basic controls need to be in place. Few such controls are discussed below:

1. Inferior Yields – Inferior yields can result when detailed product specification haven’t been developed or aren’t used consistently. If you don’t tell your vendors exactly the grade, type, size or brand of each product ordered, you might get products of inferior quality, which affect your food taste and consistency, and can also result in higher waste and shrinkage.

2. Appropriate quality – Its is also important to choose the appropriate quality and grade of each product considering its intended use. For example, you spend the extra money to purchase the high quality, large sized, name branded lemons that are squeezed in the kitchen for batch recipes, when a lower-quality, no-name lemon would work just as well and save money too.

3. Padded orders – The staff or manager responsible for receiving the goods at a restaurant must always tally the received goods with the purchase order and not accept a padded order. For example, if 2 cases of lettuce were ordered and 4 are being delivered, the 2 cases extra should be returned. If you however accept, it is possible that you have over-purchased. Chances are good that at least a portion of tat excess lettuce will be lost because of poor portion control (because there is more lettuce on hand to use), spoilage and/or waste.

4. Over- portioning – Prep or line cooks can become overly generous or careless and put too much on the plate. While consistent over portioning is bad enough and leads to excess food costs, what’s worse is to portion in an inconsistent manner. It is the surest way to turn off even your faithful regulars.

5. Inventory Levels – The amount of money a restaurant will make depends to a sizable degree on how well it manages inventory. The strategy is to reduce the inventory and maintain a lower, yet adequate amount, employees have less product at their disposal, and they tend to do a better job of handling and portioning what they have. This results in less waste, less spoilage and it often leads to fewer losses due to theft, which causes food cost to go down. Obviously, there’s a limit to how far you can reduce food inventory but getting rid of as much of the excess as possible is the goal. For full-menu operators, the food inventory generally optimizes at six to seven days of food on hand. For Limited menu and QSRs, three to five days of food on hand usually is considered adequate but not excessive. Where feasible, lowering inventory levels by two or three days can result in food cost reductions equal to 2-3 percentage points and sometimes even more. Sometimes, operators track their inventory levels by category. Sometimes, operators track inventory of key products on daily basis. Think of inventory in the same way you think of CASH.

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