to avoid excessive costs by reducing waste and other forms of loss to a minimum, without sacrificing the quality or quantity of the food which goes to the customer.
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2. An effective control procedure will serve other purposes as well:
aid in developing popular menus
aid in improving the quality of the product
aid in pricing for profit
The Flow of Costs Through the Various Food and Beverage Activities
1.Basic Operating activities
Pre-preparation (butchering, vegetable cleaning etc. )
Preparation (cooking, baking, salad and sandwich making, etc. )
Accounting and sales
Food and Beverage costs in the majority of restaurant operations represent the largest single expenditure of the revenue. Food and beverage costs are influenced by the way the various activities such as purchasing, receiving, storing, issuing, pre-preparation, preparation and accounting are performed. Food and beverage control procedures should serve as effective “tools of management” to aid in the control of costs.
They should be designed in such a way that the most effective allocation of time is made to the planning, comparing and corrective action phases of control, with the emphasis on planning. F&B control systems must be effectively used by management before they can be a valuable aid in the control of costs.
F&B control systems are supported by various types of “standards: established by management e. g. , standard purchase specifications, standard portion sizes, standard recipes, etc. F&B control systems should be simple and flexible. Management is responsible for cost control, and should make use of every tool and technique at its disposal in order to keep costs in line with what they should be.
In large, complex F&B operations, management is given cost control assistance in the form of staff specialists such as a food and beverage control office. ? In small F&B operations, the manager and his operating staff must alone maintain the necessary planning and control procedures as part of their day-to-day responsibilities. Four Basic Operating Procedures:
1. Food Purchasing, Receiving, Storing and Issuing
The primary objective of each of the basic operating procedures should be kept in mind during this study
Purchasing: to obtain the best quality of merchandise based on established specifications, at the best possible price.
Receiving: to obtain the quality and quantity of merchandise ordered and at the quoted price.
Storing: to maintain adequate stocks of merchandise on hand, and to avoid loss through theft or spoilage.
Issuing: to insure proper authorization for the merchandise to be released and to properly account for each day’s issue.
Standard Purchase Specification
A purchase specification is a concise description of the quality, size, and weight or count factors desired for a particular item
Management establishes standard purchase specifications based upon a thorough study of the menu needs and their merchandising and pricing policies
The purchasing agent, the purveyors of the company, and the company’s receiving clerk should each have a set of the established specifications
1. There are 3 basic requisites for effective purchasing;
a qualified and honest purchaser;
a sound set of standard purchase specifications
effective buying methods and procedures.
2. Standard purchase specifications are concise descriptions of the quality, size, and weight or count factors desired for a particular item.
3. Copies of the purchase specifications should be in the hands of;
the purchasing agent,
the company’s purveyors
the company’s receiving clerk.
4. Constant follow-up and evaluation procedures are necessary in order to insure the continuous adherence to established policies and procedures.
.The personnel responsible for receiving should know all aspects of the merchandise they are called upon to evaluate and receive.
Food merchandise should be checked from the viewpoint of quality, quantity, specification, and price.
All merchandise accepted should be supported by an invoice, and the details of the invoice summarized on a daily receiving sheet.
Constant follow-up and evaluation checks are necessary to ensure proper performance of the receiving procedures.
1. Definition of Terms
Cost of Food Consumed
Cost of Food Sold
Month-end Actual Cost of Food Consumed
Daily Actual Food Cost
Standard Food Cost
2. Basic Formula for Calculating Actual Food Costs
Opening inventory + purchases = cost of merchandise available
Merchandise available – closing inventory = cost of food consumed
Food consumed + or – charges or credits = cost of food sold
The Closing Inventory of the ‘Current ‘ month becomes the opening inventory of the following month.
Care and accuracy should be the rule in determining inventory value [pic] Paper prepared by Murage Macharia Lecturer, Mombasa Technical Training Institute P. O. BOX 81220 Mombasa 80100 Mobile: +254 726 604 340 +254 750 604340