Upload
orion-tarver
View
219
Download
3
Tags:
Embed Size (px)
Citation preview
OH 6-1
Controlling Food Costs in Storage and Issuing
Controlling Foodservice Costs
6OH 6-1
OH 6-2
Chapter Learning Objectives
Describe food storage techniques used to control theft.
Explain the first in, first out (FIFO) method of stock rotation.
Describe the proper method of taking inventory.
Describe the various methods of inventory pricing (valuation).
OH 6-3
Chapter Learning Objectives continued
Calculate inventory turnover rate and inventory value.
Compare physical inventory to perpetual inventory.
Calculate a daily food cost.
OH 6-4
Storage Practices Impact Profits
Spoilage of products
Theft of products
OH 6-5
Sales Needed to Replace the Value of Spoiled or Stolen Items
Assume 5% restaurant net profit
Assume loss of two steaks @ $7.00 cost each
Amount lost ÷ Net profit
percentage = Additional sales required to replace lost revenue
$14.00 ÷ 0.05 = $280.00
OH 6-6
Controlling Spoilage
Storage loss from spoilage is usually caused by carelessness.
Spoilage loss can be controlled.
Spoilage is caused by Improper product rotation
Time abuse
Temperature abuse
OH 6-7
Controlling Spoilage continued
Excellent sanitation practices help minimize spoilage loss.
OH 6-8
First In First Out (FIFO)
Use for refrigerated, frozen, and dry products
Use oldest product first.
Relies on The receiving clerk (to rotate stock properly)
The person using the product (to choose properly)
Must be continually monitored by management!
OH 6-9
Dry Storage
OH 6-10
Fresh Fruits and Vegetables
OH 6-11
Eggs and Dairy
OH 6-12
Meat and Poultry
OH 6-13
Fish
OH 6-14
Proper Sanitation Is Key
Store foods away from walls and at least six inches above the floor.
Store dry goods in airtight containers.
Walls and floors should be nonporous and easily cleaned.
OH 6-15
Proper Sanitation Is Key continued
Rotate stock to minimize spoilage.
Organize products so they are easily found.
Label shelves and sealed food containers.
Include “use by” dates and name labels for all stored products.
OH 6-16
Controlling Theft
Keep storage areas locked whenever practical.
Establish a par stock per shift system for key ingredients.
Issue secondary sets of keys on an as-needed basis only.
OH 6-17
Sample Requisition Form
Large foodservice operations may use a requisition system to help control theft-related losses.
OH 6-18
Inventory Types
Physical inventory An actual count of inventory items
Usually taken to obtain information for theincome statement.
Perpetual inventory A count based upon additions to (purchases) and
subtractions from (requisitions) storage
If records are properly kept, it is always up-to-date.
OH 6-19
Common Inventory Breakdowns
Meats
Dairy
Bakery
Produce
Frozen foods
Canned foods
Dry goods
OH 6-20
Common Inventory Breakdowns continued
The type of restaurant you manage will help determine the specific inventory breakdowns best suited for your use.
OH 6-21
Sample Inventory Sheet
OH 6-22
Inventory Valuation Methods
FIFO First in, first out
Inventory is valued at its most recent (latest) cost.
Oldest product is used first.
LIFO Last in, first out
Inventory is valued at the cost of the oldest product.
Newest product is used first.
OH 6-23
Inventory Valuation Methods continued
Averaged price method Inventory is valued at a composite of all prices paid
for the item.
Actual price method Each inventory item is valued at its original purchase
price.
OH 6-24
Inventory and Cost of Food Sold
Inventory value is a critical component of the cost of food sold formula.
Opening inventory
+ Purchases
Total food available
– Closing inventory
Cost of food sold
OH 6-25
Inventory Turnover Calculation
Step 1 – Calculate average inventory.
Step 2 – Calculate the inventory turnover.
( Opening inventory + Closing
inventory ) ÷ 2 = Average inventory
Cost of food sold ÷ Average
inventory = Inventory turnover
OH 6-26
Daily Food Cost Percent Calculation Using Perpetual Inventory
Step 1 – Compute daily food cost.
Step 2 – Compute food cost percentage.
Requisitions
+ Transfers in
– Transfers out
Daily food cost
Daily food cost
÷
Daily unit sales = Daily food cost
percentage
OH 6-27
How Would You Answer the Following Questions?
1. The greatest cause of inventory loss is (theft/poor buying practices).
2. The most common product storage method used in foodservice is (FIFO/LIFO).
3. The type of inventory that is based upon a theoretical count is called a
A. Breakdown inventoryB. Requisition inventoryC. Physical inventoryD. Perpetual inventory
4. Daily food cost divided by (unit sales/transfers out of inventory) equals daily food cost percentage.
OH 6-28
Key Term Review
Actual price method
Averaged price method
Daily food cost
Extending
FIFO method
Inventory
Inventory breakdown
Inventory turnover
Issuing
OH 6-29
Key Term Review continued
Latest price method
LIFO method
Padding
Perpetual Inventory
Physical inventory
Requisitions
Time and temperature control
Transfer
OH 6-30
Chapter Learning Objectives— What Did You Learn?
Describe food storage techniques used to control theft.
Explain the FIFO method of stock rotation.
Describe the proper method of taking inventory.
Describe the various methods of inventory pricing (valuation).
OH 6-31
Chapter Learning Objectives— What Did You Learn? continued
Calculate inventory turnover rate and inventory value.
Compare physical inventory to perpetual inventory.
Calculate a daily food cost.