2Using Standardized Recipes to Determine Standard Portion Cost 3Controlling Foodservice CostsOH 3-2
3Chapter Learning Objectives Explain why a standardized recipe is important for cost control and product consistency.Describe information included in a standardized recipe.Compare “as purchased” and “edible portion” methods in determining the cost of recipe ingredients.Develop a recipe cost card using a standardized recipe.Instructor’s NotesIndicate that these objectives (competencies) drive the information in the chapter and in this session.Ask he following questions, “How important is ‘consistency’ to you when you are personally selecting a restaurant?” “Who is most responsible for ensuring product and service consistency in a restaurant?”Review Questions on page 28.
4Benefits of Standardized Recipes Consistency in Food QualityCustomer satisfactionPredictable YieldsPreparation method consistentStandard portion sizes (weight, volume or count)Service method consistencyFood Cost ControlInstructor’s NotesRemind students that inconsistent food can be one of a restaurant’s greatestproblems, and the consistent use of standardized recipes helps to eliminate that problem.Ask students to suggest what information should be listed on astandardized recipe.
5What Difference Does It Make??? Mexi Beef Casserole: 35lb ground beef for 200 people x 5 portions per ½ steam table pan.Mexi Beef CasseroleDifference in CostCost/serving with 35l bCost/serving with 40 lbPer Serving$0.76$0.85+$0.09Not a big deal right?Annual impact for 3 times per week$0.09 per serving x 200 servings x 156 = $2,808For example, my recipe for Mexi Beef Casserole calls for 35 lb of ground beefto make 200 servings. The Mexi Beef Casserole recipe is specified to serve25 portions per pan by cutting a half steam table pan 5 x 5.If my chef uses 40 lb of ground beef (four 10-lb packages),the cost per portion increases significantly because 5 additional pounds of meat were used.Impact annually if this was done 3 times per week = $2,808
6What Difference Does It Make??? What if the pan was cut 4 x 5?Servings per panCost per serving20 servings$0.9525 servings$0.76Difference$0.19Annual impact for 3 times per week$0.19 per serving x 200 servings x 156 = $5,928
7Benefits of Standardized Recipes Accurate PurchasingQuantities defined and controlledHelps ensure compliance with “Truth In Menu” lawsConsistent nutrient contentIdentification of food alergensAssists in training new employees
8What Difference Does It Make??? Nutrient Facts25 servings per pan20 servings per panServing size6.5 oz8.1 ozCalories255318Protein12.7 g15.9 gCarbohydrate22.5 g28.2 gTotal Fat12.5 g15.6 gSaturated Fat5.0 g6.2 gCholesterol44.0 g55.0 gU. S. Department of Agriculture, Food and Nutrition Service, with the National Food Service Management Institute. (2002). Measuringsuccess with standardized recipes. University, MS: National Food Service Management Institute.
9Standardized Recipes Identify Recipe TitleIngredient details (quality)Ingredient weights and measuresNecessary equipment and toolsVolume (number) of portions (Recipe Yield)Instructor’s NotesExplain the difference between a recipe’s stated volume (i.e., makes six quarts, yields ten pounds) and the number of portions the recipe will actually produce.
10Standardized Recipes also Include Preparation timeStorage and preparation informationCooking method(s)Instructor’s NotesAsk why chefs are sometimes hesitant to standardize their personally developed recipes.Explain that few recipes state the total time required to make the recipe because the skill level of food production workers varies greatly.If time permits, ask students to write down a recipe of their own (in standardized format) that they can share.
11Sample Standardized Recipe Instructor’s NotesAsk students to look for and identify each of the seven items listed on the previous two slides.
12Recipe Standardization Process Recipe verificationPrepare recipe, verify yieldsProduct evaluationRecipe modification & quantity adjustmentsAdjusting yields and/or ingredient amountsCost recipe based on final standardized recipeComputerized programs do this as well costing, i.e. CBORD, Eatec, Recipe Manager, ChefTecBenefits: no math skills required, can start with any recipe and after entered into computer can adjust to desiredyield, final recipe can yield any number of servings desiredProblems: expensive programs, labor to do initial build of data and to maintain data, accuracy if initial info ormaintenance info is inaccurate
13Recipe Ingredient Costing Alternatives As Purchased (AP) methodPrice of an item before any trim or waste are consideredExample—unpeeled, whole potatoesEdible Portion (EP) methodPrice of an item after all trim and waste has been taken into accountExample—peeled, cubed potatoesInstructor’s NotesExplain that recipe costing is only possible with standardized recipes.Ask for examples of items typically purchased in AP and EP market forms.
14AP and EPAs Purchased (AP) refers to products as the restaurant receives them.Edible Portion (EP) refers to products as the guests receive them.Instructor’s NotesIndicate that most food products are delivered to a restaurant in their AP state.Ask students for examples of products purchased in an EP form. Examples: milk, wine and beer, and baked goods such as bread and buns.
15Comparison of AP and EP Weights Instructor’s NotesAsk if the AP price of an item can ever be lower than its EP price. (Answer: if an item has zero trim loss, AP price can equal EP price, but AP price can never be lower than EP price.)
16Managers MustDetermine if recipe ingredients are listed in AP or EP formats.Apply the correct costing method to the ingredients.Use the information to price menu items.Periodically re-cost recipe ingredients.Instructor’s NotesExplain to students that the use of specifications will have the effect of reducing variation in the price paid for an item (among various suppliers) because each vendor will be supplying exactly the same item.Explain that changing food suppliers may change the EP cost of some ingredients purchased by the restaurant because of differences in the newly supplied productsYieldPrice
17EP AmountsBecause many food items shrink when they are cooked, managers must know exactly how much cooking loss to expect.Instructor’s NotesExplain that, even if foods are purchased cleaned and trimmed, water loss in foods is the inevitable result of applying heat (cooking) so there will often be reductions in food volume.Explain that a yield test is a method of calculating the loss related to cooking and trimming, peeling and cleaning.
18Ways to Estimate Yields Butcher’s testsTo measure loss from deboning, trimming, and portioning meats, fish, and poultryCooking loss testsTo measure loss from the actual cooking processConversion chartsTell the expected or average loss of an item from (AP) to (EP)Instructor’s NotesExplain that an AP product’s ultimate yield may vary based upon grade, age, storage techniques, and skill level of the cook preparing the food.Discuss difference in terminology of shrinkage (how much loss) vs. yield (total left).Show example of Roast Meat Chart for a cooking loss test.Work example problem on page 32.
19Creating Recipe Cost Cards Step 1 – Copy the ingredients from the standardized recipe card to the cost card.Step 2 – List the amount of each ingredient used.Step 3 – Indicate the cost of each ingredient as listed on the invoice.Instructor’s NotesPoint out that creating recipe cost cards has seven steps.Explain that for the first step, you must list all ingredients, including spices, in the form they are used in the recipe, i.e., pounds, tablespoons, ounces, cups, and quarts.Ask for examples of items that are purchased in one unit, but used in recipes in another unit. Example: Black pepper is usually purchased by the pound or ounce, but is often added to recipes by the tablespoon or teaspoon.Inform students that conversions must often be made from the cost of an AP unit to the cost of an EP unit.Show KMS unit 7 – 1.
20Creating Recipe Cost Cards continued Step 4 – Convert the cost of the invoice unit to the cost of the recipe unit.ExampleMilk purchased by the gallon for $2.80Yields eight recipe-ready (EP) pints at $0.35 each. ($2.80 ÷ 8 pints = $0.35 per pint) orsixteen recipe-ready (EP) cups at $0.175 each ($2.80 ÷ 16 cups = $0.175 per cup)Instructor’s NotesAssure that students understand that there are eight pints to one gallon.
21Creating Recipe Cost Cards continued Step 5 – Multiply the recipe unit cost by the amount required in the recipe.ExampleRecipe amount required—3 pintsCost per pint—$0.35Ingredient cost—$1.05 (3 pints x $0.35 per pint = $1.05)Instructor’s NotesExplain that the math skills required in this step are the same as those required for standardizing recipes and for taking physical inventories.
22Creating Recipe Cost Cards continued Step 6 – Add the cost of all ingredients.Instructor’s NotesExplain that, for some very low cost ingredients, like salt and minor spices, some managers estimate a fixed amount per recipe (i.e., one penny per portion or $0.25 per recipe) rather than listing the actual ingredient cost.
23Creating Recipe Cost Cards continued Step 7 – Divide the total recipe cost by the number of portions produced.ExampleTotal recipe cost—$145.50Total recipe yield—50 portionsCost per portion—$2.91 ($ ÷ 50 portions = $2.91 per portion)Instructor’s NotesRemind students that recipe cards are used to determine portion costs.Explain that all of the individual portion costs on a combination plate equal the plate cost.Plate costs can include items such as entrée, vegetable, and starch, or even a full three or more course meal.Explain that accurate portion or plate costs are needed to calculate a restaurant’s menu prices.Walk through example on page 35.Show KMS unit 7 – 2.Do exercise on page 37.
24Spice FactorCan be used instead of costing out every spice, herb and seasoningA way to account for “to taste” spices in a recipeSpreads the cost of spices, herbs and seasonings over all menu items so those that require a larger quantity do not bear the entire cost of the spicesCan also include garnishes or “lost” items as a result of chef error
25Spice Factor, continued Determining a spice factorConsider which items to includeCalculate the value of all selected items over a period of timeAfter the value is calculated determine the spice factor as follows:Spice factor = Value of spice factor items (over time)Value of total food purchases (over same time)Adjust recipe’s cost by increasing the total cost by the spice factor percent - mulitplying by spice factorRecipe Cost x (1 + Spice Factor)Considerations should include: spices, herbs, seasonings, garnishesPeriod of time should be long enough to get a good average of your menu items. If the selected items are also used as a primary ingredient in other recipes the use for just the garnish, spice etc must be calculated separately, i.e. if an orange slice is used as a garnish and also in an ambrosia salad the cost of the orange used for garnish alone is calculated for the spice factor.
26Spice Factor, continued Example:If the spice factor items cost $2,000 for a six month period and the total food purchases over the same period of time are $60,000, what is the spice factor?$2,000/$60,000 = or 3.33%If the total recipe cost for Chicken Parmesan which serves 12 people is $53.75, what is the spice-factor adjusted recipe cost?$53.75 x ( ) = $55.54If used, the spice factor should be used for ALL recipes in the business, regardless of the use of spices, herbs or condiments.
27Q FactorA method to account for side dishes, add-ons or other freebies that come with entrée dishes.Only factor for the entrées offered by the businessDetermine cost of each of the side or add-on possibilitiesIdentify the most expensive options that could be selectedAdd this cost to every entréeSides/ add-ons could include soup, salad, potatoes, desserts – whatever is specified by how the entrée is menued.If the business offers a “side” to all customers it would make more sense to add it to the spice factor.For example, if tortilla chips are offered to all customers upon seating – add this item to the spice factor.
28Q Factor, continued Example: A business offers entrées that include a choice of soup or salad, choice of vegetable or starch, bread and butter. What is the Q factor if the costs are:Tomato soup $0.85French onion soup $0.65House salad $0.92Caesar salad $1.35Broccoli side $0.43Carrot side $0.16Green bean side $0.25Smashed potato $0.53Angel hair pasta $0.35Bread $0.11Butter $0.08Calculate the most expensive of each option:Caesar salad $1.35Smashed potato $0.53Bread $0.11Butter $0.08$2.07
29Q Factor, continuedQ Factor of $2.07 should be added to all entrées for this business that offer the same add-onsIf a business uses both Spice Factor and Q Factor, the spice factor should only be added once for each entrée. Add the Q factor and then add the spice factorSo, for our Chicken Parmesan what is the cost per portion using both the Spice factor and the Q factor?
30Spice Factor & Q FactorChicken Parmesan serving 12 people cost of recipe = $53.75Spice Factor = 3.33%Q Factor = $2.07$53.75 x = $55.54 recipe cost with spice factorCost per portion: $55.54/12 = $4.63Add Q factor: $ $2.07 = $6.70 cost of entree
31How Would You Answer the Following Questions? The cost of most AP food products is higher than their EP cost. (True/False)Which of the following is NOT true about recipe cost cards?They help establish menu selling prices.They reduce food production time.There should be one for every menu item.They inform managers about how much it costs to make a single portion of an item.Software programs designed to help foodservice managers create recipe cost cards are readily available. (True/False)Instructor’s NotesAnswersFalseBTrueNote: indicate that the last part of this discussion will provide a review of definitions for the key terms used in the chapter.ALSO do Questions on page 39.
32Key Term Review As purchased (AP) method Butcher test Conversion chart Cooking loss testEdible portion (EP) methodInstructor’s NotesAs purchased (AP) method—used to cost an ingredient at the purchase price prior to considering any trim or wasteButcher test—used to measure the amount of shrinkage that occurs during the trimming of meat productsConversion chart—list of food items showing the expected, or average, shrinkage from AP amount to EP amountCooking loss test—way to measure the amount of product shrinkage during the cooking or roasting processEdible portion (EP) method—used to cost an ingredient after it has been trimmed and waste has been removed so that only the usable portion of the item is consideredNote that there are additional key terms for this chapter.
33Key Term Review Portion size Recipe cost card Shrinkage Standard portion costStandardized recipeInstructor’s NotesPortion size—size of a menu itemRecipe cost card—tool used to calculate standard portion cost for a menu itemShrinkage—amount of loss incurred when a product is trimmed and cooked, roasted, or otherwise prepared for serviceStandard portion cost—exact amount that one serving or portion of a food item should cost when prepared according to the item’s standardized recipe that has been pre-costed with current purchase costStandardized recipe—lists the ingredients and quantities needed for a menu item, as well as the methods used to produce it and its portion size
34Chapter Learning Objectives— What Did You Learn? Explain why a standardized recipe is important for cost control and product consistency.Describe the information included in a standardized recipe.Compare “as purchased” and “edible portion” methods in determining the cost of recipe ingredients.Develop a recipe cost card using a standardized recipe.Instructor’s NotesAsk students to do a personal assessment of the extent to which they know the information or can perform the activity noted in each objective.