What steps can you take to improve your restaurant operation’s cost of goods sold (COGS)?
DEFINITIONS
What is cost of goods sold? Food. Beverage. Paper.
COGS: Largest expense as an operator; challenging to control and maintain.
What hurts COGS? Missed forecasting, ordering/receiving errors, transfers/borrow and loan, inventory control, unintentional loss/waste, Poor training
Steps you can take
Sales Forecasting
- Calendars: remember first quarter events like community events, federal holidays, winter/school breaks.
- Ordering: over ordering? If you are over sales forecast, you have too much product.
- Scheduling: Are your employees properly staffed for daypart – specific food prep tasks?
- Training: Forecasting and scheduling training & developments for all employees
Order
- Deliveries: schedule truck order 2-3 times a week
- Organizations: Storage areas, order guide, use inventory management to track product
- Use built-to-order system
- Implement a 10% sales buffer that can help accommodate for random spikes in sales
Receiving
- Make ordering a two-person process
- Order enough product to get through to next delivery
- Appoint someone to receive the order and put it away
- Check-in items to make sure you are getting what you order
- Rotate products! This will prevent loss, waste, and quality issues
Inventory
- Keep kitchen and storage areas clean and organized
- File inventory sheet for review and teaching
- Have opening manager verify previous day’s count/variances
- Continuously check inventory through the week
Preparation
- Have specific book and recipe cards to be followed
- Make sure utensils and cookware are clean
- Hot foods: protect yields and cook to proper temperatures
- Monitor all prep and carryover / non-peak times
Line Operations
- Use proper portioning tools and use portion control
- Train kitchen staff on all recipes, ingredients, and cleaning
- Monitor waste in garbage cans and sinks
POS metrics/ loss of theft
- Train cashiers and implement register accountability
- Monitor all POS metrics
- Perform surprise cash audits on cashiers
