You’ve heard it again and again. And it’s true. Failing at controlling food costs is like throwing your money away. These 6 surefire tips will improve your bottom line and conduct a meaningful food cost analysis:
1. Reduce your inventory.
I’ve seen many cases where reducing inventory levels by two or three days results in food cost reductions of 2-3 percentage points and often even more. Why? Because there’s less spoilage, less waste, better portioning, less theft, essentially much more overall care in handling of your inventory when there is less of it around.
I’m not advocating reducing inventory levels to the point that you risk constantly running out of products. What we’re talking about is reducing or eliminating the amount of “excess” inventory that 98 percent to 100 percent of the time you don’t need and won’t use.
Lowering your food inventory and maintaining a low yet adequate amount is a genuine double win, too. Your food cost will be lower and (the best reason of all) your customers will get better food. When inventory levels are reduced, inventory turns over quicker, food spends less time on the shelf and your guests get higher-quality, fresher products. Awesome!
2. Calculate food costs weekly.
Most small caterers calculate their food cost once a month. Virtually all the large caterers calculate their food cost each week. According to industry averages, large caterers are two to three times as profitable as smaller caterers. While weekly food costing isn’t the main reason, it’s part of it.
Here’s the problem with knowing your food cost only once a month. If your monthly profits and losses indicates that your food cost is 4 percentage points higher than normal, there is not much you can do about it; it’s probably been a few weeks, at least, since the month ended so you’re already halfway through the next month. The most profitable caterers in our industry know what their food cost is every week — 52 times a year — so if there’s a problem, they know about it quickly and can respond.
3. Portion food correctly.
Serve food in portions that will not over- or under-fill plates. When customers are finished eating, look at the plates as they come back to the kitchen. If there is a lot left on the plate, or you are consistently wrapping up takehome containers, you may be over-portioning your meals.
4. Rethink the garnish.
Garnishes often consist of fancy fruits or layers of fresh lettuce which add visual appeal but are rarely eaten. Use less expensive food items or remove garnishes entirely to save on food costs.
5. Keep a record of all food waste.
Use a waste chart to write down any foods that are made incorrectly, thrown away or spilled. Failing to record this “usage” will skew inventory reports and throw off your food cost percentage.
6. Catering software.
Use a sophisticated catering program that will streamline the various aspects of your catering operations; like automatically generating food cost data. Catering software will help you save time and money while helping you focus on marketing, and creating great events.
So what’s the lesson here?
Remember, failure to control your food costs is like throwing money away so do not, I REPEAT, do not overlook this.
As the CEO of Better Cater, I’m working hard to develop catering software that will give caterers the power to control your food costs and give you the ability, knowledge, and confidence to do your job perfectly and to your specification.
CEO of Better Cater – https://www.bettercater.com
P.S. If you have any questions, feel free to email me at Steve@bettercater.com and I will get back to you within 24 hours. I promise!