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5 Best Practices for Recording Restaurant Kitchen Inventory

Ask any restaurateur the secret sauce to ensure profits in their line of business and one of the ingredients would be having an effective Inventory Management System. While one would describe the inventory recording process as complicated and tedious, recent advancements in technology have made sure to simplify the process and save time. Inventory is a significant investment in a restaurant business and hence failing to keep a count of it or mismanaging it could lead to huge losses.

So why should one invest in a good Inventory Management System? To begin with, a whopping 40% (roughly about 7.5 tons) of the food produced, is being wasted in India daily. Restaurants buy too much food at a time that ends up getting spoilt before serving the customers. An Inventory Management System can help solve this problem. Secondly, restaurants can use inventory management to closely track their food and purchases, allowing them to better manage purchases and payments to vendors. And lastly, the total cost of goods sold is a major component that determines net profits. Inventory management decreases waste, which lowers the cost of goods sold and ultimately increases profits.

Now that you know the importance of inventory management, let’s go on to the 5 best practices for recording restaurant kitchen inventory.

1. Employ Easy-to-Use Templates

Making use of detailed templates in your inventory management software allows for easy data insertion, negating the common perception of inventory taking as mundane and time consuming. Using templates not only streamlines the process but also makes sure that your staff doesn’t forget any ingredients while recording the inventory.

Barometer Inventory Management System

2. Consistent Inventory Recording

Recording inventory consistently not only helps in maintaining count, but also helps in understanding how a product contributes to the overall pricing of a menu item. Hence, one must create organised schedules for different types of SKUs based on their freshness validity. A daily stock recording of opening and closing inventory will help record the perishable ingredients being used on a daily basis.

An executive recording inventory of a restaurant.

3. Refrain from Overstocking

Generally, restaurants order their inventory based on previous consumption patterns. Owing to the nature of theoretical numbers, there’s always a possibility of a shortage or wastage. The most important role of inventory management is to avoid overstocking. When the central kitchen and storage are overflowing with ingredients, the kitchen staff are at a liberty to use them as they wish which could lead to an imbalance and result in a negative food cost variance.

Product overstocking in commercial refrigerators.

4. Integrate your Inventory Management System with a Point-of-Sales System

Going one step further and integrating your POS System with an inventory management system could be a huge boon for your business. A POS System helps in understanding customer ordering patterns and hence predict demand based on a variety of factors such as previous trends, seasonality and other preset conditions. This would aid in better business decisions regarding your inventory purchase thereby increasing your profit margins.

A customer paying through a POS System.

5. Insights from Inventory Reports

The best part about digitising and evaluating information via softwares is the rich analytics one gets and the ability to make sound business decisions based on it. Reports help a restaurateur to visualise the past, present and future performance of their business. For example, if you notice a major variance for a menu item having low contribution margin, a decision to discontinue it can be taken and save wastage of associated ingredients.

Barometer Inventory Management System reports

One of the major reasons for the closure of a restaurant is due to rising costs and poor management. Being able to sustain a restaurant business requires meticulous planning and the ability to make decisions that can increase the profitability. An Inventory Management System is created for this very purpose and helps a restaurateur to manage and plan well in advance for the upcoming demand based on trends so that they do not miss on the business opportunity.

Want to learn more about Barometer Technologies or the topics discussed in this post?

Click Schedule a Chat to schedule a demo with our team today, to get a more hands-on look at how Barometer is going to help you run a better business.

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