August 29, 2016

3 Tips for Properly Managing Food Costs

As a chef, you’re responsible for more than just creating delicious and engaging meals. True kitchen gurus must also consider their food costs, or how much they spend on ingredients and associated products throughout a given period (day, week, month, so on). In a column for Restaurant-Hospitality.com, chef/educator Adam Weiner explained that chefs who don’t pay heed to their finances will soon find themselves unemployed. Here are three handy tips for managing your food costs:

“Chefs who don’t manage food costs will soon find themselves unemployed.”

1. Do the math
As the Houston Chronicle reported, the first step in this process is calculating your food cost. You’ll need to do so with each dish, so begin with every ingredient that goes into said plate. From there, you’ll need to outline the individual cost. So, if you have an orange that costs 35 cents, and it only yields about seven slices, then each slice is about 5 cents. Once you’ve added up the total costs, you can then dive deeper into the percentage price. If you sell that tasty orange salad for $25, and the costs are $5, then your food costs equal 20 percent{. This is the most basic way to measure food cost, but there are also considerations for labor that we’ll discuss in later posts.

The Restaurant Technology Guys offered up a fairly simple but effective formula:

  • (Beginning inventory + Food purchases – Ending inventory) / Food sales = Food cost

Properly managing food cost is an important part of running a successful business.
2. Nail down ordering

According to Star Chefs, one of the most effective ways to prevent losing money on your food costs is to make sure you’re properly ordering your supplies. First, keep an inventory. You’ll be able to see what not only what you have available at all times but what you use the most. That way, you can purchase key items in bulk, which saves money in the long run. If you don’t use some items, like specialty meats, in bulk, then it’s better to buy only 15 to 20 pounds at a time. To further manage their costs, many chefs will buy directly from the source. That way, there is no middleman involved and prices are generally lower.

3. Control food flow
Many chefs experience huge losses due to wasted food. As Chef’s Resources explained, preventing this waste means controlling the food every step of the way. When purchasing, for instance, buy exactly what you need and only use one to two vendors at most; that way, you’re not overwhelmed with paperwork and other communications. When you receive the food, have a system for tracking everything that comes in and enough space to store it properly. Your food storage option should also include daily inspections, not only for safety but also for security purposes. Chefs can even take steps while prepping food, like ensuring meat and veggies are trimmed properly and food isn’t overcooked.

If you’re attending Austin or Boulder culinary academy, be sure to nail down proper food cost management while you’re still a student. That way, you can begin your career without financial hiccups and dedicate more time to the craft of cooking.