Food Cost ManagementEmilie Gorman · Courtney Marshall · Amanda Parks

Quick Session on Food Cost Management• Improve the success of your dining establishment

• Tips for increasing profit

• Areas of high concern for y0ur business

Lesson Plan

I. Menu Execution

II. Food Prep

III.Storing Food

IV. Eliminating Waste

V. Record Keeping

VI. Forecasting

I. Menu ExecutionHow menu items effect your business

Target points

a) Pricing

b) Seasonality

c) High profit/low cost items

Pricing• Edible Yield– For produce, determine what % is edible and then cost

it out using only that amount instead of the full weight of the item as is

– For meat you must consider how much is reduced when cooked as well as unedible portions such as bones or excess fat

Pricing• Calculate out each ingredient cost and then add

up

• Long process but well worth it

• Also consider the cost of “free” items offered to customers– Rolls, butter, plate garnishes

Pricing• Lastly, look at the following to ensure you are in

the ballpark price range for your success– Location

– Competition

– Clientele

– Atmosphere

Restaurant Markups

Pizz

a

Past

aEgg

s

Sala

ds

Stea

k

Seaf

ood

0%10%20%30%40%50%60%70%80%90%

100%

PriceCost

“LOSS LEADERS”

Following seasonality• Cheaper prices

• Less travel– Increased quality

• Evolving menu– Keeps customer interest

Year Round

Winter

Spring

Summer

Fall

II. Food PreparationFull utilization of ingredients in time efficient manners

Standardized Recipes• Consistentcy

• Developing known yield

• Inventory predictablity

• Maintains proper food cost

• Ease of purchasing

• Increased labor efficency

Interview: Dan Winans• Program Director, EcoGastronomy,

University of New Hampshire

• Previous restuarant owner

• Lectured over forty courses at a culinary school on “Managing Food Cost”

III. Food StorageEfficient and proper usage of space

Target points• Storage capacity (refrigerator/freezer, cupboard

space)

• Vendor delivery schedule/operating schedule

• Items perishability and shelf life

• Purchase Point

First IN First

OUT

Older items are to be taken out of storage prior to more recently

delivered products

IN STORAGE

NEW DELIVERY

IV. Eliminate WasteDon’t be throwing $ down the drain!

Opportunities in many areas:– Freeze leftovers

– Buy what you need

– Buy appropriate portions

– Set up a compost bucket

– Measure, measure, measure to not over serve portions and lose money!

V. Record KeepingMaintaining accurate books

Why is it important?– Payment of suppliers, employees, debts, supplies, etc.

– Predicts type and amount of food item needed based on past sales and number of customers in a given season

VI. ForecastingUsing past data to determine future needs and demands

How many customers will I have?

• Daily

• Weekly

• Monthly

• Yearly

• Holidays

• Meal times (breakfast, lunch, dinner, etc.)

What does the customer want?

• Popular vs. unpopular menu items

• Specific diets (gluten-free, vegan, allergies, etc.)

Seasonal Influence• Consider slow and busy times of year– Based on past years

– Type and amount of food

– Number of customers

– Hours of operation

– Seasonal vs. annual staff members

ReferencesDopson, Lea R., David K. Hayes, and Jack E. Miller. Study Guide to Accompany Food and Beverage Cost Control. Hoboken, NJ: John Wiley, 2008. Print. Dopson, Lea and David K.Hayes. Food and Beverage Cost Control. New York: John Wiley & Sons, 2010. Print. Finz, Stacy. “Restaurant Markups Deconstructed.” San Fransisco Chronicle. May 22, 2011. Web. Available at: http://www.sfgate.com/business/article/Restaurant-markups-deconstructed-2370995.php.  “Forecasting in Food Service.” Hotel Mule. Hospitality and Tourism. Available at: http://hotelmule.com/wiki/Forecasting-in-foodservice Hayhurst, Gabriela. Store owner, Henrys’ Market in New Castle, NH. Personal Interview. April 2013. Mcevty P, S Marshall, and B Ware. The Menu and Cycle of Cost Control. Dubuque, Iowa: Kendall Hunt 2002. Print.  Ojugo, Clement, and Todd Rymer. Practical Food & Beverage Cost Control. Albany, NY: Delmar, 1999. Print. “Why Use Standardized Recipes?” National Food Service Management Institute. Tools and tips for trainers. Available at: http://www.nfsmi.org/documentlibraryfiles/PDF/20110314105501.pdf Winans, Dan. Lecturer, Hospitality Management. Personal Interview. April 2013.

Images*

http://img4-2.cookinglight.timeinc.net/i/2008/10/0810p14-kitchen-scale-m.jpg?300:300

http://teacherweb.com/NY/Arlington/Losee/CE_Ch13_328-345.pdf

http://www.onearth.org/files/onearth/article_images/spr10_livinggreen_01_FoodWaste_slideshow.jpg

http://media-cdn.tripadvisor.com/media/photo-s/03/2f/7c/2c/henry-s-market-cafe.jpg

http://teacherweb.com/NY/Arlington/Losee/CE_Ch13_328-345.pdf

*Aside from Microsoft Office Clip Art