By Steve Habazin, Contributor
On average, restaurants spend between 20% and 40% on food. That’s a good chunk of the budget! Food and beverage prices can fluctuate, as well, making it difficult for restaurants to control costs.
That’s why inventory control is one of the most important parts of a restaurant’s business. Inventory control refers to the process of keeping an accurate count of all food and drink stock to maintain consistent inventory that keeps the restaurant on budget. As an operator, you should always know what is coming in and going out of your restaurant.
There are so many moving parts around inventory, however, it can be difficult to make your inventory control process as efficient as it can be. In this article, we’ll discuss seven actions you can take right now to help streamline your inventory control and get a handle on your food costs.
1. Establish an Inventory Process
First things first. If you haven’t already, set up a regular schedule for taking inventory. Typically, inventory is taken before you open and again after you close. That way, you have an accurate count of the stocktake used every day.
Designate one person per shift to take inventory, as well. Typically, that role is given to a manager or more senior staff member.
Taking inventory can be as basic as writing numbers in a spreadsheet or as robust as using an inventory software solution that can help you automate the entire inventory process.
2. Organize Your Stocktake
Create ingredient categories within your inventory management software or spreadsheet. Categories may include dry goods, produce, dairy, and meats. At the bar, you may create categories such as soft drinks, beer, wine, and spirits.
Then organize your stocktake on the shelves to reflect those categories. That will speed up not only the inventory process but food prep, as well, by making items easy to find.
In fact, a well-organized food inventory will:
Streamline inventory counts, freeing staff up for other tasks
Increase turnover by reducing prep time and wait times for orders
Reduce theft by making ingredients more visible — and more noticeable when they’re gone
Create more accurate inventory forecasts and budgets
With an inventory software solution, simply enter each ingredient and category once. After that, staff can manually count or scan barcodes to take inventory.
3. Switch to a Lean Inventory Process
Basically, when a restaurant practices lean inventory management, it keeps just enough stocktake on hand to meet customer demand. That eliminates waste by doing away with bulk items that cover every possible ordering scenario.
By keeping only what you need during a shift, day, or week, you reduce the possibility of spoiled or expired ingredients.
There are key elements you will need to follow the lean inventory process:
JIT Inventory: Just-in-time, or JIT, inventory refers to the practice of ordering ingredients only when your inventory dips below par level.
FIFO: First-In-First-Out (FIFO) inventory is the practice of pulling older items from inventory first. That reduces waste through spoilage.
4. Start a Waste Log
A 2015 Natural Resources Defense Council (NRDC) report estimated that between 22 and 33 billion pounds of food is wasted by restaurants every year. And about 7% of food in restaurants is wasted before it even reaches the customer.
Before you can reduce waste in your restaurant, however, you have to understand how much food is being wasted. A waste log will help you track every bit of food that doesn’t end up on a customer’s plate.
That includes waste caused by:
Spills
Misfires
Burned or ruined orders
Spoiled or expired ingredients
Comped meals
Theft
Scraps from paring, cutting, or butchering
Any time food goes to waste because of one of the above reasons, staff should record what each ingredient was and how much was wasted in your waste log.
You can then use the log to look for solutions to reduce waste.
Of course, you can have staff write down waste or log it into a spreadsheet. Doing so, however, can waste time and lead to inaccuracies. An inventory management software solution with a mobile app, however, allows staff to record waste as they work.
5. Use Recipe Software to Control Waste
One great way to control waste and keep inventory counts accurate is to use recipe software that indicates exact amounts of each ingredient for your dishes. Cookbook software that is available via mobile device allows staff to access each recipe as they work, reducing the time it would take to search through a binder or hard copy.
Recipes stored via the cloud are updated easily and never lost or destroyed.
6. Set Up a Receiving Process
When orders come in from vendors, there should be only one person taking receipt of the delivery. That person is responsible for checking the ingredients against the order to ensure everything is there and that the invoice is accurate. They should also look for damaged or spoiled items and request a credit if they find any.
By designating a single point person for receipt and setting up clear procedures, restaurant owners can keep an accurate count of incoming ingredients, reduce over-ordering, and avoid running out of stocktake mid-shift.
7. Sync Your Inventory with Your POS System
Your POS system plays an integral part in your inventory management. By integrating POS data with your inventory software you can:
Compare inventory numbers with sales, allowing you to keep accurate food costs
Compare items sold with inventory numbers to calculate food waste
Pivot quickly and order less of an ingredient if sales are down.
In fact, inventory control via a software solution can go beyond simply keeping accurate numbers on your inventory. A good solution will allow you to set up alerts when stock is low and automate orders. It will also sync with not only your POS system, but your accounting and staffing software, as well, so that you have a clear picture of your business operations from one dashboard.
But it all starts with keeping tabs on your most valuable asset -- your food and beverage inventory.
