Monday, 19 May 2014

Time to take stock...

Picture the've been packed all day for Sunday lunch and that dreaded last service of the week looms on Sunday evening. Not too many in the book but with last minute bookings and walk-ins you get slammed again! Like a heavy weight boxer in the 12th round, you stay on your feet just long enough to get the last main courses out. Then it's over with and just as your thoughts begin to turn to frosty beer you have an unexpected and not very welcome moment of clarity....end of week stock take!

This is not far from reality for many restaurants and for those who actually do a weekly stock take, the quality of the information gained can often be questionable. In my experience, this is one area which is absolutely critical for a restaurant but is a major weakness for many. Even those who go to the trouble of counting their stock accurately and regularly, many do nothing with the information except establish their re-ordering requirements.

So why is it so important and what should you do with the information? Well the stock on your shelves and in your stores and fridges can run into thousands of hard earned Euro in value and every item should be properly accounted for. In addition, you can not calculate your Gross Profit margin correctly without accurate opening and closing stock figures. Most importantly of all, you need to know if there are any stock variances and if so, why. This essentially means establishing if every item which you purchased was sold and if not, is it still in stock. I have found that the process also throws up a lot of other valuable yet unforeseen information. Over the years I've used the same simple method and have discovered employee fraud, supplier fraud, staff errors, and previously unknown glitches in POS systems.

As an example, here's another scenario. It's Saturday night and the room is full. There are lots of tables ordering drinks but the POS terminal has a queue of waiters already looking to key in orders. With customers getting impatient for their drinks, one staff member decides to show some initiative and shout his drink orders to the bar person with a view to keying them in once the terminal becomes free. Drinks are served and the staff member moves on and forgets to key in the drinks. Customers don't get charged and you will never know about it unless you calculate your stock variances at the end of the week. Items not being charged for, accidentally or otherwise, is a very common problem and if left unchecked can amount to thousands in lost revenue annually.

This may all sound a little obvious but in reality, very few restaurants are on top of this issue. The reason is usually because they are too busy. Chef/owners are up to their elbows in chicken carcasses and FOH owners are snowed under with paperwork and staff issues! It's an easy trap to fall into but a difficult one to get out of.

There is a very simple, user friendly weekly routine which helps ensure every item of stock is accounted for, down to a single bottle of water. In most cases this will improve GP% and will almost certainly highlight problems that you never even know you had.

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