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Ways to Cut Food Costs

Innovation in cloud-based software and mobile technology today has dramatically increased the ability for businesses to easily capture data to better manage their restaurants. Restaurants can analyze aspects of their business with data that wasn’t previously available or easy to collect. With timely insights, restaurants can optimize processes, make better decisions, and save time and money. Here are some of the best ways a restaurant chain can take action with technology to save on food costs:

1. Analyze menu mix in real time

It’s critical to understand the performance of each menu item from a sales and gross profit standpoint. This requires having accurate and up-to-date data on every ingredient in every item you sell and every minute spent preparing and serving it. This information needs to be delivered in a fast, easy-to-understand manner that draws your attention to exceptions so you can take action and adjust the underlying causes of escalating costs. Cloud-based, back-office software gives you one system that can combine sales and cost information in real-time across all your locations, regardless of the point-of-sale you’re using.

With a few clicks, you can compare gross margins by item at different locations, and quickly take action. For example, with poorer performing items at a location, you can quickly find the most expensive ingredients, and compare pricing with other suppliers to renegotiate your contract.

2. Optimize your supply chain to always order the right quantities at the right time

Counting key-item inventory daily is a critical process for the success of any restaurant. Daily inventory counts provide a better understanding of exactly what items and quantities you’ll need to order. This will help determine correct par stock levels – helping you reduce excess inventory and food spoilage.
Today, mobile apps make it easy to input and analyze daily inventory data. Users can digitally record inventory counts right inside the stockroom. Inventory apps allow you to record custom units like bags, trays, or cans, so there is no need to manually convert units, making it easy to track inventory in way that makes sense in your restaurant. Integration with your back-office system is key, so the system can automatically trigger a purchase order when inventory falls below a certain level.

When orders are delivered, store managers can use the same app to check the order in – count or weigh items, and mark them as complete or short. Any purchase order discrepancies are automatically flagged and the supply chain management system is updated, giving the accounting or procurement department full visibility of purchasing at all locations.

3. Cut waste and manage margins

Refrigerators and freezers that are just a few degrees off can have a big impact on food and energy waste, if you’re not conducting regular temperature checks it could result in lower margins. Today, you can use a Bluetooth connected thermometer to automatically alert staff if temperatures rise above acceptable levels so they can quickly take action.
Combined with daily inventory counts that are in place, you can accurately track the source of any variances such as waste, comp’d meals, and theft, helping you spot a problem before it impacts your bottom line.

Reducing food costs without sacrificing quality standards is vital for survival in the incredibly competitive food service industry. With a system that monitors and analyzes the menu mix at all of your locations, you can identify and prevent losses. Having an inventory app that can track daily inventory and relay that information to suppliers eases your supply chain and helps your restaurant keep up with demand. Connecting daily inventory counts with refrigerator and freezer thermometers for temperature monitoring can save your margins by cutting spoilage and theft. Using cloud-based back office software not only helps save food costs, but gives you a leg up on your competition.