According to the National Restaurant Association, 75% of U.S. restaurants struggle to make a profit because of poor inventory and food cost management. And on average, 10% of the food is wasted even before making it to the dishes. These are big numbers, calling for a kitchen inventory management emergency. That’s why we’ve penned down this topic to help you master kitchen inventory management, ensuring you avoid common pitfalls that many restaurants face inventory shortage or spoiled food due to malfunctioning refrigerators and walk-ins, which is why using commercial refrigerator services for regular maintenance is so important. So, without further ado, let’s get started.

What Is Restaurant Kitchen Inventory Management?

Restaurant kitchen inventory management at its core is tracking your stock levels, monitoring their usage over time, calculating the cost-to-sales ratio, predicting customer demand, and matching stock levels with sales trends. This is necessary to keep a balance between a seamless client experience and avoiding overspending on your kitchen inventory.

Otherwise, your average amount spent on food inventory would go above 35%, which is the usual amount. So, if your goal is to run a successful restaurant business, you have to learn everything about kitchen inventory management.

Let’s get started with common inventory terms.

Restaurant Kitchen Inventory Terminology

In general, restaurant kitchen inventory includes:

• Food ingredients
• Spices
• Dry goods
• Pots and pans
• Beverages
• Employee uniforms
• Linens

However, experts use some specific terms for this inventory to manage it all together. Here we’ve enlisted the most common of them:

Sitting Inventory

This means the total amount of kitchen inventory available at the moment. You can record sitting inventory either in numbers, dollars or in some measurement unit. Just remember, whatever measuring unit you choose, stick to that.

Depletion

Depletion is usually defined as the amount of product used in a specified period. You can calculate your depletion weekly, monthly, or over a long period.

Usage

This means how long you can use a stock before it runs out. You can calculate usage by dividing your sitting inventory by your depletion time.

For instance, if you have 180 kg of uncooked rice, and you’re planning to use 6 kg every day, you have 30 days of usage without restocking.

Variance

Variance is often recorded as a percentage and is the difference between depletion and how much your POS says you’ve sold.

For instance, at the end of the weekend, your hamburger inventory is 250 pounds down. But your record says you’ve only sold 190 pounds of hamburger. So, the difference is 10 pounds. Or, in percentage, it’s 10/200 (5%).

Dead Stock

It’s the stock apart from the sitting inventory that didn’t sell well and has no hope to sell well in the future either.

Par Level

This is the amount limit for an ingredient you set yourself for a dish on your menu. If you buy lower than this level, you won’t be able to fulfill customer demand. And if you buy more, your stock will be wasted.

Catch Weight

This is a standard measurement for foods that fluctuate in weight, so you’ll measure their yield and weight margin with flexibility.

Why Do You Need To Manage Restaurant Kitchen Inventory?

Food inventory takes up most of the restaurant budget, and if you don’t manage it efficiently your business won’t thrive. Plus, it helps you avoid food waste and spoilage as well, which are some of the major problems of the world today.

Here we’ve enlisted some of the major benefits of kitchen inventory management for restaurants:

• Higher profit: When you’re making more than you’ve invested, or simply not overspending on food inventory, your return on investment will be higher.
• Happy Customers: You will be able to fulfill customer demands with a stocked inventory.
• Good Vendor Relationship: With good inventory management, you will be able to order and pay your vendors on time.
• Automated Inventory Supply: With a managed inventory system, you will be able to automate your inventory supply.
• Less food loss: By keeping a record of your food supply, you will be able to reduce food spoilage.
• Saving on Capital: You’re saving more, and making more money by avoiding over-ordering.

Kitchen Inventory Management Practices

Now that you’re familiar with the basic terminology and why you should manage your kitchen inventory, let’s move on to the main section “How to manage restaurant kitchen inventory?

Invest in a Good Inventory Management Tool

Before technology, restaurant owners were forced to use manual techniques to manage their kitchen inventory. But that’s not the case anymore. Now you can invest in a good inventory management tool to automate your tracking process.

It’ll let you know what products to refill, what you’ve already run out of, and track your food wastage as well.

Train Your Employees

Inventory management isn’t just a one-person job. It takes a team to build this whole system and follow it. So, you need to teach every person on your staff about how you’re tracking the in and out flow of the inventory and how to organize the inventory in the right refrigeration unit or storage unit to make the food inventory last long safely. This way, they’ll know their next step precisely in case there’s a spoilage or spill.

Make An Inventory Consumption Sheet

The easiest way to track your inventory is by creating a sheet where you’ll record how much of an ingredient you have, how much it costs, how much you’ve used & wasted, and what your profit rate is at the end of the day. This will help you keep a record at hand which you can update regularly.

Track Your Inventory Consistently

Hire staff you can trust and have at least two of them in charge of inventory. Then, with this little supervising team of yours, track your inventory regularly.

Compare this physical number with your recorded levels and see if there’s any difference. It’s a great way to avoid food inventory theft or any other such abnormalities.

Apply The First-In, First-Out Method

Make sure to label your inventory precisely with names and the date they’re best before. And then, use the first-in, first-out method. Use the stock that’s bought first. And then, later use the newer one.

This way, nothing is wasted due to spoilage. And if it still happens, your staff will be held accountable.

Regularly Clean Stock Shelves

This is the most ancient yet effective technique for regularly managing your inventory stock, because a messy kitchen inventory could result in over-ordering, double ordering, and missed stock items. This is no fun and could lead to major capital loss.

Therefore, we recommend regular cleanups of your inventory stocks. Group them into categories and add more shelves if needed. Plus, assign a specific ID to each item for search purposes on your software or spreadsheet.

Conclusion

Effective kitchen inventory management is critical for restaurants and cafe businesses to help them reduce food waste and earn a good return on their investment. This can be assured by regular inventory tracking and the usage of different automation software.

Plus, build a strong relationship with your suppliers for better quality stock items and favorable discounts. Moreover, schedule regular maintenance of your restaurant equipment and appliances that is provided by commercial appliances repair Fairfax technicians.