Inventory control is the cornerstone of your restaurant’s operation, mismanagement of inventory can result in more than lost revenue on just one particular product, but a complete inability to fulfill multiple menu items, as a lack of one ingredient could hinder your staff’s ability to produce several dishes. Ensuring proper inventory control will prevent this dilemma and help maintain a smooth-running operation. Contrarily, overstock of perishable items may lead to spoilage and waste, resulting in unwanted financial loss. Food industry leaders understand that high costs and low margins mean that every dollar must be spent wisely, rendering inventory control the most vital aspect of the management of your clubhouse restaurant.
What Is Food Inventory Management?
It’s tedious, cumbersome and challenging, but food inventory management can be the most important responsibility on the long list of a restaurant manager’s duties. It directly affects every other aspect of the business. It’s about the items you have on hand, the inventory levels on your shelves, organized in your pantries, and the storage within your refrigerators and freezers. Too much could be wasteful – too little is restrictive and will affect customer service.
Why is it Important?
Despite the fact that almost one billion people go to bed hungry every night, improvements in food management in some parts of the world are being diminished by an equally ineffective effort in other parts. The United States, for instance, wastes just under half of its food, much of which is still edible. There are several causes attributable to this loss, including weather, instability in the markets, and ineffective buying practices. Unfortunately, restaurants play a great role in this waste, with up to of 33 billion pounds of food misused, squandered, and thrown away. This is a direct result of overordering and mismanagement of dishes and the ingredients that comprise them.
As in other businesses, your restaurant buying practices directly impact your profits and bottom line. Adequate tracking systems will help you understand what items you use, at what quantity, and with what frequency you must restock to ensure you don’t exhaust your supply. By definition, any waste within a business is costing that establishment money – this is magnified in the restaurant industry, with around $25 billion lost to waste annually. Restaurant waste takes place before customer contact, as well as after. Between the food that never reaches your customers’ tables and that which is left on those tables after their meal, a great amount of revenue is being thrown in the receptacle. In fact, effective inventory control could save your business up to five or six percent in restaurant costs – do the math for your business and see what that translates to in dollars.
In golf, customer satisfaction is king. Every part of your facility should be geared towards customer relationships including your restaurant. As mentioned, inventory management and control trickles upward to affect all other facets of a restaurant, not least of which is the satisfaction and pleasure of your clientele. Rearing loyal customers starts with your processes and procedures – make the ordering process simple and consistent, and you’re ahead of the game. Ensure a sufficient quantity of all supplies and ingredients to avoid that regrettable conversation – “I’m sorry – we’re all out of that.”
Tips On Managing Your Food Inventory
Keep Your Storage Clean and Organized
Accurate inventory control starts with organization. Ensure you have proper shelving and efficient categorization methods. Label everything accurately and apply a unique ID to each item to make cross-referencing to your inventory spreadsheet easier. These steps will prevent double-counting and will ensure the right quantity of each item is either on hand or on order.
Assign a Team
As with most aspects of business, organization is key. Produce an inventory schedule that shows the frequency of inventory procedures. You must have a team that understands the importance of an accurate inventory. This dedicated team of two or three individuals will know the whole process, from receiving items, storing them, and how they apply to the menu selections. They should be laser-focused on streamlining the process so it is timely, efficient, and accurate.
Create Tracking Document
Accurate recordkeeping is another vital cog in the inventory control process. Using a software, as well as spreadsheets, will allow those taking the physical inventory to enter their findings into the spreadsheet, and enable you to subsequently update your inventory software with precise numbers that represent a valid portrayal of your inventory. Your spreadsheet should contain such headers as:
- inventory ID
- item name
- unit of measure and cost
- quantity currently in stock
- item value based on the previous two items
- total inventory value.
Conducting your periodic inventory count with these particulars in mind will generate an accurate spreadsheet that will help you manage your business to its potential.
Track Consistently and Regularly
The inventory should be done on a regular basis, usually on the same day and time to avoid inconsistencies. Ideally, your entire staff should be trained to conduct an accurate inventory; however, as mentioned earlier, having two or three dedicated team members doing it consistently will ensure a more reliable tally.
Follow First-In/First-Out (FIFO) Inventory Method
Most Accounting majors are familiar with the FIFO concept. In restaurant management, the practice dictates that older food is used first to reduce spoilage and waste. FIFO helps facilitate a process of product utilization that maximizes inventory usage and generates a rotation of items. As older items are incorporated into menu items, newer inventory becomes the old and replenishment can take place. In this system, every item is used, reducing costs and increasing profits.
All food and beverage operations experience a surplus of items or products in their storage on occasion. The key is to recognize those extras and utilize them wisely and innovatively, perhaps creating a unique dish or unannounced special. Of course, incorporating them into existing menu items could be the simplest way to go.
The effects of technology on 21st-century businesses is almost immeasurable. From ease-of-use to time-saving methods, to pinpoint accuracy of data, systems like Lightspeed POS track your inventory in real-time with updates as your workday proceeds. The system also generates detailed reports that provide a comprehensive view of your business. With solutions such as customizable menus, adjustable floor plans, stock management, and a kitchen display system, Lightspeed’s technology and capabilities can help streamline the most important processes and procedures of your restaurant, giving you a leg up on the competition, as well as on the challenges that present themselves daily.
These tips and statements reinforce the fact that inventory control is like the Great Oz behind the curtain, managing the strings of your business – it may not be flashy or sexy, but doing it right will translate to happy customers, increased revenue, and a positive effect on the environment. Adhering to these measures will provide an advantage in your effort to improve your operation.