Restaurants 101

Inventory

What is Restaurant Inventory Management?

What is inventory management? Inventory management is having oversight and control over the stock in your restaurant. For proper inventory management, you must track your purchasing, storage and food costs....Read more

Who Are the Biggest Restaurant Suppliers?

Whether your restaurant is farm-to-table or you are producing food in high volume, chances are as a restaurant owner or manager, you'll consider one of the bigger restaurant suppliers for...Read more

Tips on Taking Your Inventory

Taking physical inventory counts can be a daunting task, especially if you have a high volume of inventory at your restaurant. We want to make physical inventory counting easier, more...Read more

What is Inventory Grouping?

Inventory grouping is a system in which you organize and count your inventory according to different classifications. Inventory is placed under different classes in or to manage and control inventory...Read more

What is FIFO?

FIFO Explained FIFO stands for First-In, First-Out. It is a method of asset management and valuation where the goods or products produced or bought first are sold, used or discarded...Read more

What is Current Ratio?

Your current ratio is a figure that you can get by dividing the value of your current assets with the value of your current liabilities. If your current ratio is...Read more

Three Numbers Every Restaurant Manager Should Know

Cost of Goods Sold  What it is:  Your Costs of Goods Sold takes into account the value of your inventory to tell you how much it costs to make a...Read more

What is Food Cost Variance?

Food cost variance is the difference between what you actually pay for your goods and what you expect to pay for your goods. Since transactions happen daily in a restaurant...Read more

How to Create a Restaurant Inventory Spreadsheet

Getting a handle on your inventory is an  essential aspect of your restaurant operations. Your inventory levels are important to measure and track, since food items are perishable and significant...Read more

Five Spreadsheets for Tracking Restaurant Inventory

Before you start tracking your restaurant inventory, you'll want to choose the right software. With so many options, in order to find the right app, you should decide what are...Read more

What is Average Inventory?

Since inventory levels change based on seasons and high demand periods, in order to get a more accurate understanding of the value of your inventory without the disturbances of seasonal...Read more

What is Inventory on Hand

Inventory on hand, also known as, days of inventory, is a ratio used to measure the number of days it takes your business to sell it's average balance of inventory....Read more

How to Calculate Inventory Turnover Ratio

Inventory turnover ratio is a number that measures how many times your restaurant sold its total average inventory during a given time period.  It's an important metric to determine at...Read more

What is Distressed Inventory?

In inventory lingo "distressed" products are those products sitting on your shelf that are at risk for spoilage if they are not used in the near future. The reason inventory...Read more

What is Prime Cost?

Prime cost in a restaurant is the cost of labor and the cost of food and beverage purchases. Unlike fixed costs, prime costs are costs that can be adjusted in order...Read more

What is an Operational Budget?

Your restaurant’s operating budget is the calculation of your restaurant’s expenses and your projected profits. In order to calculate your operating budge,t you need to add up all of your...Read more

What is Gross Profit Percentage?

Gross profit percentage is defined as : the proportion of sales in relation to the cost of creating the product. By finding your gross profit percentage, you can see if your...Read more

What is Sitting Inventory?

Sitting inventory is  defined as the dollars worth amount of the inventory you have in stock in house. You can calculate your sitting inventory in two ways:  by dollar amount...Read more

What is Inventory Turnover Rate?

Inventory Turnover Rate is another word for Cost of Goods sold.  This means the amount of money you paid for your ingredients to make a dish, rather than the amount...Read more

What is Food Cost Percent?

Your food cost percent is defined as the percentage of your sales that you spend on food. This is an extremely important number as you can imagine, one of the...Read more

What is Expected Inventory Count?

Inventory Count, also known as "stock takes" in some countries, helps you to keep track of your inventory levels. Inventory counts are a record of each item in your restaurant. As...Read more

What is Cost of Goods Sold (COGS)?

Cost of goods sold (known as COGS) is how much it costs you to make a product you sell. In a restaurant this would be the cost of making a...Read more

What are Optimal Inventory Levels?

Once you determine your Cost of Goods Sold and work out your Food Cost Percent, you'll be able to find out what the optimal inventory levels are for your stock in your restaurant. Optimal...Read more

What are Inventory Par Levels?

Inventory par levels are the minimum quantity of a given item that must always be in stock. When an item hits below par levels, an order should be placed to replenish that...Read more

How to Create and Maintain Optimal Inventory Levels

Understanding how to manage your inventory begins with understanding your COGS (cost of goods sold) . In a restaurant fairing well, the COGS is usually 30-35% of food sales. If...Read more