What Inventory Variance Means?
Inventory variance is the amount leftover when you subtract the amount of product you’ve sold from the amount of product you’ve used in a determined period of time. It’s normal to have some inventory variance, and attempting to achieve no inventory variance isn’t realistic. You should expect a certain amount to be lost each month (or whatever timeframe you’re calculating your inventory variance for).
Common Causes of Inventory Variance
In restaurant operations, this can occur for a variety of reasons.
Common causes of inventory variance include-- Food waste
- Incorrect portion sizing
- Unrecorded staff meals
- Spoiled product
- Data entry errors
- Theft.
If there is a discrepancy between the two data sets, the manager will examine sales records, purchase records, and kitchen usage for the past weeks to ascertain why there is a discrepancy. In certain instances, the POS system will be adjusted to reflect the real inventory amount.