Seeking Food Cost Analysis Advice Amongst Other Stuff:

[Dasbook]

Hello all,

Situation: I am a line cook with 1.5 years experience in a small but very busy college town bistro (Eugene, OR). Recently, due to some restructuring at the restaurant (the boozers got the boot), I find myself the most senior cook and newly appointed kitchen manager.

Before I showed up we didn't offer any specials at our restaurant. A few months back I got bored and started running specials. After a bit of trial and error, the specials formula I use seems to be working and we are consistently selling out of the specials and turning a profit.

Super.

Now that I am kitchen manager, I'm looking for ways to boost our mediocre business into a money making machine. The owners seem to be behind me and are more often than not very encouraging.

Given the opportunity I now have, what steps should I take to ensure I'm heading in the right direction?

I understand this is a pretty ambiguous question.

One thing I've read about is food cost analysis. Many websites emphasize the importance of knowing exactly what your food cost is. The owners do not at this point pay too much attention to the numbers. In a perfect world we would fire cysco/sysco (sp?) and stop shopping at costco and start participating in the local/sustainable trend. We would get away from frozen chicken and frozen calamari and run a kitchen focusing on fresher is better. But, I don't want to pitch any ideas that aren't economically sound. Before I can investigate switching food suppliers (something the owners seemed open to), I feel I need to get a grip on what our food cost is. This process seems daunting, and I don't have the greatest confidence in my accounting skills.

Any advice would be greatly appreciated,
Looking to do the right things,
Cheers,
Dasbook.

[santoku]

congratulations on your promotion:
its probably not as hard as you think it would be. my advice would be to

1) take a full inventory of all food related items (meat, fish, produce, dry goods, etc). you gotta weigh everything out. next, go to your invoices and figure out what you paid for your inventory.

2) take that amount and divide it by your sales for the month or week. that will give your food cost.

if anyone has a better way, speak up.

[Patchouli]

Are you privvy to the food invoices?
If so, make a spreadsheet outlining each food cost, break it down into portions you use it in; then you have something concrete to compare to other vendor pricing; an also something to plug into figuring out your foodcost on every single item you sell; do your menu item pricing based on this knowledge, ensuring whatever foodcost range you want to be within;
It's actually a lot of work when you're first setting this all up, and then once it's done, it's only adding on additional info and products. It's an exercise which must be done though if you want to make sure you're charging the right levels. A management tool to help you make decisions like which product to buy, or from where, or whether to leave out an item, or switch for a less expensive, or etc etc etc
You'll get to the point where you can do a rough calc in your head when determining your lunch specials on the fly and life will be good.
What the previous poster suggested is a good start in determining what the owners are used to seeing in the past for their foodcost percentages.

[bohica]

All very good suggestions and although at the moment you feel that this is a huge challenge, be mindful that you are working towards the ultimate goal of increasing business and turning a descent profit.

The old cliche:
"Of course it's hard.....it's supposed to be hard....if it were easy anybody could do."
was not meant for everybody.

You on the other hand know what needs to be done but you are like an island all to yourself and you're not sure how to proceed. You already know what to do, but the challenge to put all these things in place is daunting.

The others are right in what they say.

Start out first with the inventory. Once you have that on file you can use the invoices to price out all the items. Better yet....there are many computer programs made for just that. All you have to do is fill in the blanks and the programs do the rest. Some POS systems are set up to do that as well. Even for the bar.

It's worth looking into. If we can help anymore PM us. Good luck.

[Chef_m_yaeger]

Bohica is right this is a huge challenge but congrats on being willing to under take it this is a vital skill. I have been done this road but the owners were unwilling to understand that a 50-60% food cost wasn’t good, grrr, but they are out of business and I left before that happened so ha! Anyways
If you really want to get control of your cost you need to standardize your recipes and cost them out. If you would like a pre-done spread sheet pm me and I can send the one I use to you, you would just insert the ingredients and unit cost, product estimated yield, Q factor(this is the uncosted items or expected waste percentage) and it figures everything else, you can even tell it what you would likethe is cost % to be and it will figure the sell price. Then I would start doing a monthly inventory and food costing from there. If you count everything in the kitchen at the beginning of the month then again at the end of the month you actual food cost is easy to figure. Once the inventory is costed out you need to take your starting inventory add the food purchases form the month and then subtract the ending inventory, this gives you your Cost of food for the month then divide that number by the total sales for the month.
Cost of food (S. inventory + Purchases – Ending inventory) / Total Sales= Actual food cost (I can also email you a spread sheet for this that is configured to do adjusted cost that figures in employee meals and comped meals that would not be in sales.)
What good is this? Well recipe food costing is important to get close to your goal food cost but they fail to account for waste so if you know that your recipe are all costed to 34% then the actual food cost should be 34% if it isn’t (which it wont) then you have waste what you do about that waste is up to you and how big that difference is. If all of the recipe are different cost % then you would need to figure a weight average food cost to figure this out.
I know that is a lot I hope it help and makes sense.

Finally this is a breeze when you get it all set up. And there is programs that will do this and more that are great but they do require set up. Also I will repeat again take to the owner in what they expect in food cost and then if you can do it it much lower be prepared to explain how the difference happens and how you are going to keep the quality.

The best of luck!

[eddie]

30% is good food cost in most resterauntss.

So you take you plate cost (the total of everything priced by the ounce or the each) then multiply by 3.

more or less

do you know how to use excell and have it at you work?

if you want more help e mail me: (Email removed for posters protection - please use the PM feature!)