List and Save: Inventory Tips for Your Restaurant Business

You serve the best food in town, you have customers coming back to get more, and you have a restaurant fan base singing your praises in the local magazines and newspapers. But restaurant management is a business, and you have to ask yourself the vital question: are you earning?


The best way to determine if you are earning enough to offset your spending is to conduct an inventory of your restaurant business. Here are a few tips for that coming inventory.


• Start your Business Right – Check each item against the invoice every time a product comes in. More importantly, check the quality, shelf life, and damage (if any) of your menu components, whether it’s soda, wine, or raw materials for your recipes. This may require more hired help on your part, but if you start your inventory early, you will have fewer things to do at the end of your inventory period.


• Update the Menu – Make sure that each offering on your menu has a recipe, so that you can tally the cost of making each dish. Update and reevaluate your menu at least once a year, so you can see what dishes earn most, and which dishes should be removed. A menu inventory will allow you to know what your strengths are, and how you can improve your food line-up.


• Check that Waste – Assign kitchen staff to make a record of all food waste. This will allow you to track how efficient your staff is, and how well-followed your recipes are.


• Calculate your Food Cost – Food cost is the ratio between the cost of food sales and food sales. Most successful restaurants average 20-30%, depending on their menu. The food cost will help you determine if you are earning enough to offset your investment. Comparing your food cost to other restaurants with offerings similar to yours will also help you determine how well you are doing compared with the competition.


• Do it Constantly! – Conduct a weekly inventory, as well as a monthly inventory to track your progress. This will keep you from having difficulties when you have to do a yearly inventory for tax purposes. This will also allow you to keep better records, so you can compare your progress from week to week, or from year to year.


Conducting an inventory is a time-consuming effort that requires you to check and cross check lists against each other – but it’s a rewarding endeavor that will give you a chance to see how good you are doing, and how you can make your restaurant business better.