Restaurant Inventory Control Systems & the Ugly Underbelly of the Industry

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This month we’ve been focusing on the value of performing your restaurant’s inventory on a weekly basis.  I know, when I say weekly and inventory in the same breath you’re most likely glaring at the computer like I just asked you to clean the toilet.  Hear me out; there are countless benefits as to why counting on weekly basis (as opposed to monthly) will become your management team’s most reliable private investigator.  Beyond the effect weekly inventory has on your bottom line (which you can read about here), it also has the ability to shine a light into the ugly underbelly of the restaurant industry; the side that’s never fun to talk about but is undoubtedly prevalent, and if left unaccounted for can have you sweating like a gypsy with a mortgage when it’s time to pay your bills.

By counting weekly you’re able to review ALL areas of your restaurant, i.e. behind the bar, your walk-in, your dry storage etc.  This is your opportunity to bring transparency to a myriad facets within your operation – in this post we’re going to look at waste, cleanliness, repair and maintenance, and last but certainly not least, theft:

  1. Waste: Inventory that’s consistently monitored and reviewed each week is your first and best defense against this foe.  This ties directly back to our previous blog post where we discussed the importance weekly inventory has on your purchasing process.  If you’re consistently over-purchasing, think of how much food you’re wasting due to spoilage.  Have you seen the Ziploc commercial where the guy grilling steaks throws one directly in the trash?  If so, you know what I’m talking about; and if you haven’t, I’d say the description above is pretty self-explanatory.  In addition to wasting due to over-ordering, improper storage practices can leave you in a major hole as well.  Leave something by the chicken that shouldn’t have been? Gotta toss it – again, that’s more dough in the trash when it should be in your bank.
  1. Cleanliness: There are two universal restaurant truths. First, every restaurant has assigned side work, and second, when not checked regularly, 80% of the side work assigned is completed poorly or not completed at all.  Performing weekly inventory enables team members to assess the cleanliness of the restaurant that results from consistent side work.  They say that cleanliness is next to Godliness; however, in the restaurant business, cleanliness is next to passing your health department audit.  A good rule of thumb is to have your side work built into your count sheets, so that you can cross reference it (or even grade it) when you’re moving through the inventory process.
  2. Repair & Maintenance: Repair and Maintenance, or R&M, is like the Boogeyman under your bed… except in your restaurant the Boogeyman is everywhere. He’s the PVC under your dishwasher that’s cracked, the HVAC System with the clogged intake vents, the compressor in the beer cooler, the O-rings around the cooler doors, the iced up freezer, the burned out light bulbs, wobbly tables, and of course the leaky toilet in the bathroom.  Life and business tend to get in the way and R&M can rapidly run you into the ground.  Each week, keep a rotating list of “big ticket” items that are critical to the success of your restaurant and perform a mini preventative maintenance check on these items during your inventory.  Trust me, the time spent doing what we call a PMC will save you thousands of dollars when you have to shut down on a Friday night because your coolers are at 56 degrees; again, directly impacting your food Cost and cash flow because you’re throwing unusable product out (hence waste discussion above).
  3. Theft: This one’s a real mood killer. No one wants to believe that the people they hired are capable of such an offense. We most often see theft due to over-abundance of product.  People feel they can steel because no one will notice.  “40 cases of beer in the cooler? Who’s going to be able to tell if take 2?” “Juicy, perfectly-marbled filet? There are 20 I can see with my naked eye – one down won’t hurt anyone.”  This goes far beyond consumed products as well; if you’re purchasing like you’re Costco when it comes to your bathroom products, your team might treat your storage that way.  Low margins will hurt your profit, but unchecked theft can close an operation. Your team needs to be made up of allies, not enemies; hence the word TEAM. Thus, reward them when things are good and have discussions when they aren’t. This makes your team members feel that they’re part of the business, while simultaneously reinforcing the idea that you have your eye on everything. As an owner you have the ability to empower your people to be the best versions of themselves.