Most managers in the food service industry work their way up from hands-on operational roles.  In the progression from operational to managerial roles a manager must learn to let-go of day-to-day operations in order to be more effective. This is often a painful transition.

A friend recently started a new role as manager of a multi-outlet operation. When he first started he was spreading himself thin, trying to manage the business while pulling duty manager shifts at night and on weekends.

It wasn’t long before he started to struggle with his administrative duties and the business began to suffer. His first instinct was to do more shifts to reduce cost. This is the downward spiral that many operators fall into.

There is an opportunity cost of covering shifts that could be filled by a $15/hr employee. There are many things that a manager can do that are worth more than $15/hr, including:

• Recruiting – spend time recruiting the right people
• Marketing – grow the business by spreading the word
• Process re-engineering – tune processes to be more efficient
• Financial Planning – Manage Creditors and Debtors to your advantage
• Purchasing – Shop around for better deals

My friend made the right choice by stepping back from operational duties and focusing on management. The turnaround was almost immediate, as he capitalised on opportunities that were previously missed. He secured some major conferences, leveraged his suppliers to sponsor promotions and worked with a local traders association to coordinate promotional events.

Stepping-back to spend more time on management is difficult for many operators.  However, not doing so is limiting for both operator and business.

If you are in the family restaurant segment your children’s offering can make a difference. Here are 10 ways to position your business to better cater for children:

1. Serve everything with a side of Tomato Ketchup.  This will save you many trips back to the kitchen.

2. Arm your front of house team.  Teach your service staff techniques for engaging with children. Have a toolkit of ways to handle inevitable situations such as unruly monsters unsupervised by exhausted parents.

3. Always have a mop ready.  Children are still learning to drive their bodies and will spill, break and drop anything that isn’t fixed to the floor.

4. Provide child friendly activities.  Offer a play area, table activities or both. Keeping a child’s mind active will increase sales, encourage repeat business and decrease your rate of slide into insanity.

7. Get something edible on the table pronto.  This helps settle the children and keep them focused.

8. Offer a range of children’s dishes.;  Target your items at kids, but also include a couple of items that parents would prefer the kids to eat.

9. Offer children sized drinks.  Kids often struggle to get through a full sized soda.

10. Streamline your check-out process.;  Parents have a keen sense of when a child has has enough of any given environment/situation. It is often only a mater of minutes before a child changes from Dorothy from the Wizard of OZ, into Regan from The Exorcist.

This Food Cost Control Blog post has an interesting perspective on using a nominal cost in recipes to account for Complimentary Items (e.g. bread rolls etc…)

Click here to read the full post…

Many kitchens rely heavily on one or two individuals to keep the wheels turning.  If one of these individuals get hit by the proverbial bus, your business could be in real trouble.

Here are some ways to reduce your Key Person Dependency:

• Plan B, Be aware of your reliance on Key Persons and have a backup plan.
• Documentation, Procedure manuals are overkill for most kitchens, however some basic documentation can save your bacon (excuse the pun).  Consider:
  • Recipes, including photographs to show presentation standards
  • Opening and closing checklists
  • Mis en place par levels
• Training, share knowledge so that your team are interchangeable.

Very few of us live without some sort of insurance. Why should your business be any different?

Count-n-Control was recently reviewed on the Back Burner Blog. Greg McGuire blogs about the foodservice industry at The Back Burner, which is written by the employees of Tundra Specialties, a company specializing in restaurant equipment and food service supplies. Here’s what they had to say:

Count-n-Control is the brainchild of long-time industry pro Paul Clarke, and it’s a tool that is going to revolutionize how you track inventory in your restaurant. No, Count-n-Control doesn’t have some crazy new way to track your stock so that shrink is 100% eliminated, and no, it’s not going to help you find the cure for cancer.
But everything you need and expect from an inventory management system is here at your fingertips, including:

• Stock and supplier tracking
• Transaction and sales tracking
• Quick-view graphing of stock
• Roll period feature
• CSV file data importing
• Multiple users and access from any internet-enabled device

The best place to start is with a receiving scale. As product rolls in the back door off the truck, weigh each bulk item and record the weight.  That way you know exactly how much of each kind of ingredient you have available.  This helps you in two ways:

1) You’ll know exactly when it’s time to order more product
2) If you’re out of product, but you only sold X number of entrees that use that product (i.e. not enough of them to be out), inventory shrink is happening, and it’s time to hunt down the culprit

Portion scales are a necessary compliment to your receiving scale. After all, if you’re measuring what’s coming in but not what’s going out, you’ll have a hard time managing your inventory.  There are two kinds of portion scales: mechanical scales and digital scales.

Mechanical portion scales indicate weights on a large, easy-to-read dial.  These scales are ideal for measuring bulky items that you’re cooking in large quantities, like french fries or chicken wings.  You sacrifice a little bit of accuracy for speed and convenience, which makes sense if you’re just pounding out apps on Super Bowl Sunday.

Digital portion scales are much more accurate and allow you to measure ingredients with precision.  Use these scales for measuring out the ingredients to your restaurant’s world famous secret sauce, anything that needs to be baked, and other multi-ingredient recipes.  The nice thing about digital scales is that you can reset the tare and calculate ingredient proportions very easily.

For those of you who don’t know, the tare on a scale is a feature that tells the scale to ignore the current weight on the scale and measure additional weight from zero.  In other words, the mixing bowl you put on the scale will weigh zero once you press the tare button and the scale will only register the weight of the ingredients you add to it.

You can measure ingredient proportions on a digital scale easily and much more accurately than with measuring cups because different ingredients compact differently in a measuring cup.  Flour is the best example.  A cup of flour can weigh between 4 and 6 ounces, depending on how compacted it is in the cup.  If you extrapolate that out to 4 cups of flour, you’ve got up to a 50% difference in the weight of the flour.

You can also calculate proportions more easily with a portion scale because you know how much ingredients that are hard to measure with a cup weigh, like eggs.  A recipe for pasta might call for three parts flour to two parts egg.  If two eggs weigh four ounces, then you know you need six ounces of flour.

Finally, scales can help you manage another extremely important inventory item in your restaurant: alcohol. Use a liquor scale to measure the remaining amount of alcohol in each bottle at the end of the day and record the amount.  I’ve seen managers go through this exercise countless times, but never with a scale.  Usually they just look at the bottle and estimate how much is left.

You depend on alcohol sales to contribute to your bottom line entirely too much for such an inaccurate evaluation of inventory.  A liquor scale takes the guesswork out of the equation and allows you to compare hard numbers with your sales so that you can spot shrink and put a stop to it quickly.

Scales mean accuracy.  Accuracy means less waste.  Less waste means less cost.  Less cost equals more profit.  The equation is as simple as that.

Stock Rotation protects your investment. Food Poisoning incidents can ruin the reputation of your establishment. Here’s 5 ways to promote stock rotation:

1. FIFO (First In, First Out). This is a foundation rule of stock rotation: Use oldest items first.
2. Put newly received goods to the back of the store to promote FIFO.
3. Record the receipt-date and use-by date on goods as they are received.
4. Record use-by date on non-perishables when they are opened.
5. Record production-date and use-by dates on food prepared, that will not be served immediately.

For the past serveral months I have been working on an online food stock control system named Count-n-Control (CnC).  CnC is based on a simple client based system that I developed 10 years ago, and has been used in over 50 food operations.

It is only in recent times that web technology has progressed to a point where online apps are feasible for applications that require large amounts of data entry.  For example: it is now possible to enter the transactions from an invoice quickly and efficiently online.  Historically this type of data entry was slow and clumsy with web-based applications.

CnC also leverages a number of ideas from Web 2.0, including:

• “cloud-based” service delivery model, accessible for any internet enabled device
• the traditional audit log is replaced with an exposed twitter style activity log
• the “Freemium” business model means anyone is free to use Count-n-Control at no cost

Many of you will have stock control systems in place.  However, for those who don’t the barrier to entry has just been lowered.  You can now access to a tool for monitoring and controlling the performance of your operation at no cost.

I will post further insights into CnC over the coming posts.  In the mean time I invite you to sign-up and let me know what you think.

Portion Control is an effective way to control food cost at the Production Phase of the Food Service Cycle. Here are a six simple Portion Control techniques:

Document Recipes
Providing documented recipes that clearly communicates the standard portion sizes provides the foundation for effective portion control.

Plate Presentation Photos
Photograph each menu item and display them in a prominent place in the kitchen. This provides a visual reminder of standard portions and is a guide for consistent plate presentation.

Mise en Place portioning
Portion ingredients before service. For dishes that are made to order, portion ingredients into small reusable plastic containers and stack them on trays ready for service.

Keep a Measure with Ingredients
Store a spoon, cup or container that holds the standard portion amount with each ingredient.

Keep a Scales in the Kitchen
Make it easy to check portions during service by making a set of scales readily available.

Monitor Meals being Served
Assign responsibility for visually checking dishes before they leave the kitchen to a member of the kitchen team.

If you buy the notion of working smarter vs. harder, the 80/20 principle is certainly a great starting point.  When a restaurateur searches for the 20% of his operation producing the 80% impact, I’d like to suggest a simple method.  The 4 V’s stand for volume, variance, volatility and value.

It is important to focus on high volume activities.  Ranking your menu items by the percentage of total sales is a popular weekly report.  Try the same analysis on your food purchases.  If you monitor production of batch recipes, you could rank these by the highest volume.  In every case, find the high volume items and activities.

Avoid spending lots of time on issues which do not produce a decent return for your efforts.  If there is a low variance in usage, price, or any other business metric, look elsewhere.  There are lots of high volume items with very little variance from your budgeted expectation.  Maybe you consume lots of rolls but the usage report indicates the rolls were used properly.  Find another item with a higher variance.

Price volatility is a major opportunity area.  Locate all of your raw ingredients with volatile market prices.  Any positive actions you take in purchasing these items will produce a benefit.

Most chefs have a handful of items stored in their offices.  You may find truffle oil, saffron, cognac and other high value items.  They recognize the relative value (in terms of cost per milliliter or gram) of these items.

If you focus on high volume items and activities with usage variances, price volatility or high relative value, the 80/20 principal will start improving your return on time invested.

All menus have some Plough Horses (also known as Cash Cows). The profitability/contribution metric used in the Menu Engineering Model is based on an average.   The nature of an average means there will always be some items below the average. Assuming all items meet the popularity benchmark, any items below the average are Plough Horses and all those items above the average are Stars.

The popularity benchmark is based on 70% of the average number of items sold.  Any items that don’t meet the popularity benchmark are Dogs or Puzzles.

As a result, we expect to have some Plough Horses on the menu. These are the menu items that our customers keep coming back for. They are perceived as good value for money and are often the backbone of the business.   They tend to sell themselves, leaving us to focus on our Stars.

Resource: Menu Engineering Model

Inventory management is time consuming and takes our focus away from building sales and providing a great customer experience.

The Pareto Principal states that 80% of the effects come from 20% of the causes. In other words: 20% of your stock items make up %80 of your stock value. By focusing on the high value 20% we can minimize the time spent on stock control, but ensure this time is spent on the things that really matter.

To implement the Parento Principle go through a full stock take and select the high value stock items that you want to focus on. You can then summarize the remaining items into a nominal cost. Next time you do a stock take you only need to count the high value items and use the previously calculated nominal value to represent the other items. You can still calculate all the key metrics like Cost of Goods and Gross Profit, but minimize the time spent on stock control.

In an age of plentiful refrigeration and high tech packaging it is possible to purchase a wide range of pre-made, pre-cut, pre-processed ingredients and even complete meals, ready to serve. In this post we look at some of the pro’s and con’s of purchasing pre-prepare ingredients/meals.

Pro’s of Out-sourcing

• Reduce labor. Suitably experienced staff are difficult to find and expensive to keep. With pre-prepared ingredients/meals it is possible to produce more meals with less staff.
• Reduce production space requirements
• Reduce amount of equipment required

Con’s of outsourcing

• Higher food costs
• Less control over quality
• Increased reliance on external suppliers

Out-sourcing may stack-up, depending on your business model.

Here are some tips if you suspect you are loosing stock due to theft:

1. Control access to your store rooms. Install locks and keep them locked when not attended.

2. Control/monitor access to your kitchen/stores from the back door. Monitoring may include CCTV cameras, an alarm on the door or as simple as paying more attention to who/what comes in and out.

3. Check waste bins before they are emptied. Waste bins may be used to smuggle valuable stock out of your kitchen.

4. Do spot stock checks/audits. Count an item you suspect of being taken at the start of the day, monitor how many are legitimately used, then do another count at the end of the day. If the variance between the start and the end of the day does not equal the usage, you have a problem.

5. Let your team know theft is not ok. Make sure your staff understand that theft will not be tolerated and that you actively monitor your stock.  This will reduce the temptation and stop honest thieves.

I have used the Recipe Template above for some time. It is ideal for documenting, printing and laminating your recipes for use in the kitchen.

The template includes both Batch and Production recipe templates, along with an ingredient list.

I hope you find it useful.

In a slow economy cutting back is an obvious way to maintain the profitability of your food operation. However, the impact of cost minimisation on the bottom line is often underestimated.

For example:

If you have a net profit of 10%, each dollar you save by reducing costs is equivalent to making a sale of $10.

Cost saving will never grow your business and can damage your business if it negatively impacts your customer experience.  However when things are slow, cost saving is your friend.

This month, I noticed an urgency in 3 restaurant chains which would be out of the question in the past. Top level financial officers have made the dive into inventory control including batch recipe models for work in progress inventory. Calling late at night, I found the CFO of a 35 unit chain in the office working feverishly to get the new database deployed. She was working on recipe costing and linking her recipes to the POS system.

Years ago, restaurant companies needed to be shoved into software systems to get better a handle on their cost of sales. Now, these solutions are ubiquitous. POS vendors throw them in for free to sweeten an offer. Solutions exist in every price range.

I spoke with the Executive Chef of a 6 unit group here in the DC Metro area. He was working on a solution with his brother who works in the accounting department. Each of their concepts has a unique menu and they have finished the first test. Results have exceeded their expectations. The actual food cost has now come down to less than 1% above ideal.

Recessions often force corporate staff to wear different hats.

As these financial people work closely with the chefs, purchasing agents and other key operations people, the reports have to improve. Communications are more focused and everyone has a feel for their counterpart’s unique issues.

Theoretical Vs. Actual

With costed recipes and sales mix information it is possible to calculate the theoretical food cost.  This then enables the comparison between actual and theoretical food cost.  Any substantial variance between theoretical and actual food cost represents an opportunity to reduce costs, directly improving the bottom line of the business.

Menu Planning

In addition to calculating the performance baseline, costed recipes are critical to the planning process.  When creating a new menu it is important to know how much each item costs before settling on an appropriate selling price.

Costing a recipe does not need to be a complex task and does not necessitate the use of expensive software.   A set of scales, a calculator and a scratch pad is really all you need.  While costing recipes will not directly assist with the next service period, it has the potential to drive enormus benefits to a food operation strategically.

Here are some tips on doing an accurate stocktake:

Have a hard copy of your stock list - A list grouping stock items by Category, then listing Stock Items in alphabetical order makes it relatively easy to look-up Stock Items as you count.

Do one storeroom at a time - If you have stock items that are stored in multiple locations (dry store, cool room and service fridges), don’t run around the kitchen to find all instances. Count methodically through one store location at a time.

Count each storage location left to right, top to bottom - Start at the top left of each shelf, then work your way down to the bottom right. That way you wont miss anything.

Count with a friend – It is faster and easier if you count in pairs. One person can physically count the stock while the other records the counts. In addition to speeding up the process this also serves as a check, to make sure you don’t miss anything.

Although counting stock may seem simple, it is surprising how many people I have seen get it wrong.

I was putting together a review on Kitchen Thermometers, when I found this review by “Cooking for Engineers”. It’s worth reading if you’re looking for a good kitchen thermometer:

“If you only have space for one thermometer, save up and treat yourself to the ThermoWorks Thermapen. It’s fast. Very fast. It also comes calibrated with documentation to prove it. You can even calibrate it yourself, so measuring the temperature of a 1/4 in. steak is no problem at all. The temperature range is greater than most thermometers and it’s also really easy to read…”

Following on from the “What is Menu Engineering” Post:

A “Puzzle” is a menu item that is classified as profitable but not popular using Menu Engineering techniques. This begs the question: “Why is this menu item not popular? How can we transform it into a Star?” In many cases engaging tactics to transform a Puzzle into a Star is a sound approach.

Some reasons why a menu item is not popular include:

• Price sensitivity/Value proposition – Is the item perceived as too expensive?
• Profile & Positioning – Is the item positioned poorly or not adequately described on the menu?
• Cultural Considerations – Are you trying to sell meat to vegetarians?
• Seasonality – Is this item more popular at different times of the year?

Tactics for transforming a Puzzle to a Star include:

• Change the description of the item
• Change the presentation of the item
• Change the location on the menu where the menu item appears
• Change the price of the item
• Offer the item as a special to increase its’ exposure

Finally, if all efforts to transform your Puzzle into a Star fail, it may be time to consider dumping it in favour of a more popular alternative.

1. Did you get what you paid for?

The first and most obvious tip is to check that you get everything you paid for.  Often this is as simple as doing a quick count and checking items off against the delivery note or invoice.

While this seems obvious, take a look at your practices and you will be amazed at how often stock is received without checking it’s all there.  Paying for stock you didn’t receive directly impacts your food margin.

2. Do a Quality Check

Make sure the stock you receive meets your expectations.  Quality assessment can be made by visually inspection, feeling, smelling and/or tasting ingredients.  Inspecting packaging for damages and checking “use-by” dates also ensure you get what you pay for.

Stock that is poor quality will impact the quality of the end product you present to your customer.  Poor quality goods may also spoil faster, generating waste and eroding your profitability.

3. Reject Goods that don’t Measure-up

Rejecting stock that doesn’t measure-up communicates your quality expectations to your suppliers, setting the base-line for future transactions.

4. Minimize the time goods spend on the Loading Dock

Ensuring stock is put away promptly increases the life of perishables and reduces the likelihood of theft.

5. Did you get everything you ordered?

Often you need to know ASAP if an ingredient that was ordered didn’t arrive so that you can make alternative arrangements.

Following on from the “What is Menu Engineering” Post:

In the previous post we took a look at the Menu Engineering process.  Menu Engineering provides an objective method of classifying menu items.

In this post we look at tactics for managing menu items classified as “Dogs”.  Dogs are low profit and not popular when compared with other menu items.

The first and most obvious question is “why is this item on the menu?”.  In many cases the smart approach is to swap this item out for a more popular and/or profitable Item.  However, there may be cases when an item classified as a “Dog” is worth keeping.

In some cases a menu item may assist to position your establishment in the minds of your customers.  For example an Eastern European restaurant may offer a Steak Tartare consisting of finely chopped raw fillet steak, served with raw egg and traditional accompaniments.  This dish is expensive to produce and appeals to a relatively narrow segment of the market, but plays a part in defining the menu as Eastern European.  In this scenario there may be a case to increase the price of the menu item to move it into the “Puzzle” classification.

Unless there are exceptional circumstances, the “Dog” classification is an indicator that the menu item can be removed from the menu.

Menu Engineering Model

The model includes all the formulas to automatically classify your menu items based on popularity & profitability and is easy to use and extend (assuming basic Excel skills).

Please leave a comment if you found it useful.

Engineering is not a term used frequently in the context of the food industry.  Simply put “engineering” is about appling technical, scentific or mathmatical knowledge to get a desired outcome.

Menu Engineering is about taking a more structured approach to building and monitoring a menu.

There are two key measures required for Menu Engineering: the Contribution and Popularity of each Menu Item.

Contribution is the amount of money we make from a Menu Item.  Assuming we have costed recipes, Contribution is calculated by subtracting the recipe cost from the sale price.

Populatrity is the number of a Menu Item sold in a given period as compared to other Menu Items.  The sales numbers can be based on actual results from a point of sale  system, or estimated/forecast sales.

Menu Items can be classified into the following groups using Contribution and Popularity:

• Stars - High Contribution & High Popularity
• Plough Horse - Low Contribution & High Popularity
• Puzzles - High Contribution & Low Popularity
• Dogs - Low Contribution & Low Popularity

These classifications provide a structured approach to plan, monitor & review menus.

It is always a pleasure to review a product you like and the “My Weigh KD7000″ is no exception. This product is functional, sturdy and simple to use.

With a large backlit display the KD7000 is easy to read and operate. The display and button panel are protected by a cover that can be removed for cleaning along with seamless construction to prevent liquid from damaging the electronics.

The KD7000 has all the usual functions such as “Tare” to reset the scale to zero, “Mode” to set the units of measure (g/kg/lb/oz) and “Hold” to store the current reading. Additionally it has facility to switch the backlight and auditory modes along with setting the auto-off behaviour (2min, 5min or manual). The 7kg (15.450 lb) capacity is adequate for most comercial kitchens and with a precision of +/- 1g (0.05 oz) it is suitable for all but the most delicate measurements.

Priced at about $40 USD the KD7000 is excellent value for money. The only drawback with the KD7000 is that it does not come with an AC adaptor. The power adaptor is an optional accessory for which you will pay an additional $5.

All things considered I have no hesitation in recommending the KD7000 for a typical commercial kitchen. 4.5 stars.

In 1955 a study on the impact of lighting levels on productivity found that workers became more productive, no matter what changes were made. The mere fact that the employees were being monitored was shown to impact behaviour.

I’m not suggesting we turn our kitchens discos by fluctuating the lighting levels. However, focusing on an issue can impact your team’s behaviour.

Our primary focus is often consumed by other such as logistics, staffing or just getting through the next sitting. Food cost is often forgotten on a day-to-day basis.

Regular stocktakes can demonstrate to your team that managing food cost is important. Better still, get your team involved, either directly in stock counts or by publishing the results on a period by period basis. By posting a graph of results in a prominent place in the kitchen (with or without a labeled axis depending on your level of comfort in disclosing your numbers) you are telling your team that food cost is important, you care if waste is out of control or staff meals are being abused.

Ultimately there are only two ways to make a food business more profitable: you can increase sales or reduce cost. In a depressed economic environment increasing sales is challenging. The followng tips are proven methods of reducing food cost:

1. Measure It

“You can’t control what you don’t measure”. Regular stock takes provide a basis for the calculation of the “Cost of Goods Sold” (CoGS). CoGS are calculated using the following simple formula.

Opening Value + Purchases – Closing Value = CoGS

The CoGS as a percentage of Sales is a valuable measure for food cost control.

A spreadsheet can be used as a easy and cost effective solution for calculating Opening and Closing stock values and tracking purchases.

2. Shop Around

It is important to build a relationship with your suppliers, however it is also healthy to compare prices with competitors to ensure you are getting a good deal. Keeping a finger on the pulse of market prices by regular price comparisons can reduce food cost.

3. In-House Preparation

Preparing food in-house rather than purchasing pre-prepared ingredients can reduce food cost. There are a wide variety of pre-prepared ingredients available, from pre-cut vegetables to pre-made sauces. Typically pre-prepared ingredients are substantially more expensive than their raw ingredients.

There are a number of considerations when comparing pre-prepared with in-house preparation including:

• Labour cost
• Availability of suitably skilled staff
• Quality

4. Monitor Waste

Again: “You can’t control what you don’t measure”. There are a number of ways to montior waste including:

• Implementing a waste log
• Waste bin audits
• Wast collection and measurment

A balance between reasonable controls and controls that apply excessive overhead is required. It is often useful to implement controls as required (when food costs are out of control) and/or spot checks.

5. Portion Control

Food portions vary for a number of reasons including differences in staff practices and raw ingredient size fluctuations. Portion size variation can be minimised by employing tactics such as documenting standard recipes and measuring out portions prior to service.

6. Stock Rotation

Rotating stock not only improves the quality and consistancy of your end product but also reduces waste, reducing food cost. Labelling food with recieval date takes the guess work out of stock rotation.

7. Go Seasonal

The cost of vegetables varies greatly depending on seasons. Typically when produce is “in-season” there is a greater supply, so that demand is easily met, and the price decreases.

Fresh seasonal produce also lasts longer. The quality of produce that is in-season is usually better as it has not been stored for long periods or travelled great distances.

8. Cost It

Costing recipes/menus provides a baseline by which to compare actual costs. Without a yardstick there is no means to determine if food cost is too high or too low.

Accurately costed recipes also provide valuable information for sales mix analysis and menu engineering.

9. Planning

Effective planning can be used to purchase wisely and reduce waste. Sales estimates based on previous periods, same time last year sales, future bookings and special events can provide a basis to purchase adequate amounts, but not excessive stock.

10. Specials

Offering specials not only adds variety to the menu, but can be used to reduce food cost. By selecting specials with a low food cost, but high percieved value can reduce the overall food cost. Specials can also be used to move slow moving stock and reduce waste.