Restaurant Inventory Management | 4 mins read

Restaurant Inventory Management- 7 Tips to Limit Waste

restaurant inventory management 7 tips to limit waste
Chloe Henderson

By Chloe Henderson

Restaurant inventory management requires diligent tracking, recording, and analysis to maintain inventory turnover, replenishment, and sales.

Restaurant inventory management is crucial as food service establishments handle perishable ingredients that could spoil, leading to wasted resources and limited profits. By establishing a system to adequately monitor stock usage, businesses can ensure that ingredients are used in a timely manner to avoid spoilage.

How to Take Restaurant Inventory

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When it comes to taking restaurant inventory, each establishment has their own unique methods. However, the primary elements that every inventory tracking plan needs include the following steps-

1. Create a Table

The most straightforward inventory table consists of five rows-

  • Items
  • Unit of Measure
  • Inventory Quantity
  • Unit Price
  • Total Cost

2. List Items

When listing items, employees should be sure to include ingredients, cleaning supplies, and any other materials that need consistent replenishment. They should also include silverware, dishes, and tabletop items.

3. Add Measurement Units

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Especially for restaurants that use multiple vendors, businesses must note each item's unit of measurement, as they tend to vary from product to product. For example, eggs may come in dozens, while tomatoes may come in pounds. By recording each measurement unit, employees can avoid miscounts and miscalculations.

4. Count Items

Once the units of measurement are defined, employees can count the units of each product and record the number in the inventory quantity row. This allows restaurants to standardize their measurements to streamline cost calculations.

5. Record Prices

With every shipment, employees must take note of the unit price and update the unit price row.

6. Calculate the Total Cost

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Lastly, employees must multiply the units of each product they have on hand by the unit price to determine the product's total cost. Once this is done for each item, the costs are added to formulate the final total cost.

7 Tips to Limit Waste

By establishing a proper inventory management system, restaurants can minimize food waste, improving efficiency and profitability.

Implement a Point-of-Sale System

With a point-of-sale (POS) solution, restaurants can generate sales forecasts, order planning reports, accounting documents, inventory tracking reports, and analytics. By integrating automated tools, such as barcodes and scanners, employees can streamline cycle counts.

By combining inventory counts with POS solutions, restaurants can pinpoint slow-moving products to prevent spoilage and limit food waste.

Designate Employees for Inventory Tracking

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Rotating all employees for inventory tracking requires additional training, resources, and time. Therefore, restaurants should designate a few kitchen staff members, such as managers and chefs, to take inventory of the ingredients. These employees will become acquainted with taking inventory and will develop their own efficient method.

Employees in charge of inventory should be adequately trained to ensure they can accurately count and record quantities. Restaurants should also consider giving inventory managers bonuses for reducing food waste, improving efficiency, and increasing savings.

Maintain a Consistent Schedule

Restaurants should take inventory on a consistent basis to maintain accuracy and prevent food spoilage. Perishable and popular ingredients should be counted daily, while non-perishables and items with lower turnover rates can be checked weekly. Businesses can alter the inventory schedule once they recognize usage patterns.

Use the First In, First Out Method

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With the first in, first out (FIFO) method, restaurants use the ingredients they received first before using the latest items ordered. This means the oldest products are used first to prevent expiration.

To put the FIFO method into use, restaurants should organize their storage areas, including the freezer, cooler, and shelves, to present the oldest items first. This requires employees to restock the newest orders in the back of storage to keep the oldest inventory front and center.

Create a Food Waste Sheet

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While an inventory list shows the units of each item, a food waste sheet illustrates what ingredients are exiting the business outside of sales. This enables businesses to determine the best way to save lost ingredients.

To limit food waste, restaurants can reduce their purchase orders or order frequency. They can also incorporate the ingredients into new menu items to encourage sales.

POS software can help restaurants minimize their food waste by generating reports on the usage of each ingredient. Businesses can digitally input tables into their POS system that records the-

  • Date and Time
  • Item and Description
  • Amount or Weight
  • Expiration Date
  • Reason for Waste
  • Employee Initials

Every employee should understand how to fill out and update the table to ensure that all staff has access to accurate inventory reports.

Use Surplus Ingredients

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Restaurants that order excess ingredients can run daily specials or update their menu to incorporate these ingredients into existing dishes. This allows the business to use up extra products while they reevaluate their ordering strategies.

However, employees and managers must be made aware of this change so they can update the menu across all sales channels to inform guests.

Reference Past Inventory Insights

By recognizing patterns of inventory usage, restaurants can improve their ordering strategies to avoid under and overstocking ingredients. Businesses can reference past and real-time POS reports to determine which product orders should be reduced and increased to improve profitability.

Making data-driven inventory decisions can minimize food waste and significantly promote the bottom line.