1. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Overview of the Food Management Process OH – 10.1 Receiving Storing Issuing Production Preparing Cooking Holding Procurement Serving Service Menu Planning

2. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Goals of Purchasing Process Purchasers desire to obtain: the right product at the right time in the right quantity from the right suppliers at the right price OH – 10.2

3. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Purchasing Activities and Responsibilities Production Issue Requisition Storage Purchase Requisition Purchasing Receiving Supplier Step 1 Step 2 Step 3 OH – 10.3

4. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Purchasing and Cost/Quality Concerns Cost-Conscious Purchasers Quality- Conscious Purchasers Value-Conscious Purchasers OH – 10.4

5. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Purchase Specification for Meat Item OH -10.5 Name of Product:Strip Loin Steak, Boneless Grade/Specification, if applicable:IMPS 1178, Choice Other Quality Information:8 ounce portion cut with 1/2 ounce tare allowance; 3/4 inch thick Packaging:Layer-packed between polyethylene sheets; 21 pound box (42 steak/box)

6. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 How Much Should Be Purchased? The basic formula: Quantity Needed – Quantity on Hand = Quantity to Purchase Sales mix data helps with quantity forecasting Purchase Quantities Must Also Consider: Safety levels Minimum delivery requirements Quantity purchase discounts Length of delivery period OH – 10.6

7. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 When to Purchase? Fresh produce, baked goods and dairy products – several times weekly (or more frequently) Dry and frozen items – weekly (or less frequently) Managers must consider Estimated usage rates Available storage space Delivery costs OH – 10.7

8. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Overview of Effective Receiving Process OH – 10.8 Compare Delivery Invoice and Purchase Order Product Quantity (Weight) Product Unit Price Confirm Product Quality Sign Delivery Invoice Move Product to Storage Issue Credit Memo (if necessary) Complete Receiving Report

9. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Daily Receiving Report OH – 10.9 SupplierInvoiceProductPurchase Unit No. of Units Unit PriceCostDirects (Food) Stores (Food) Beverages A10735EggsCase a 2$34.50$69.00 B221Sirloin Steaks Pound55$14.70$808.50 a Note: There are 30 dozen eggs in a commercial-packed case of eggs.

10. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 The Storing Process Three basic types of storage: Dry storage (50 o F – 70 o F; 10 o C – 21.1 o C ) – for grocery items such as canned goods, cereal products such as flour and alcoholic beverage products such as liquor. Refrigerated storage (less than 41 o F ; 5 o C ) – for items such as fresh meat, produce and dairy products. Frozen storage (less than 0 o F; -17.8 o C ) – for items such as frozen meats, seafood, French fries and other vegetables purchased frozen. OH – 10.10

11. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Quality Concerns During Storage Products can deteriorate under optimal storage conditions if storage times are excessive It is important to maintain the proper storage environment including temperature Cleanliness is important Shelving units should keep products off the floor and away from walls OH – 10.11

12. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Physical Inventory Form OH – 10.12 ItemPurchase UnitNo. of Units a Purchase PriceTotal Price Green BeansCase3$26.50$79.50 Note: Ideally items are stored in the same containers in which they were purchased. This can reduce double-handling and provide a convenient container for marking information about date of receipt and product costs. It is also, for example, easier to count one case of six #10 cans of fruits or vegetables than it is easier to count six individual cans of the product.

13. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Perpetual Inventory Form OH – 10.13 DateNo. of Purchase UnitsBalance InOut 37 9/10/XX-----2512 9/11/XX352027 Item:Strip Steaks (6 oz.)

14. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Inventory Turnover Rates Assume the manager takes physical inventory of all wine, beers and spirits and finds that: beverage inventory (beginning of accounting period = $29,500 beverage purchases (during accounting period) = $76,000 beverage inventory (end of accounting period) = $27,500 cost of goods sold: beverages (used during accounting period) = $78,000 Beverage inventory turnover rate equals: Cost of Goods Sold: Beverage [Beginning Beverage Inventory + Ending Beverage Inventory] ÷ 2 $78,000 [$29,500 + $27,500] ÷ 2 $78,000 $28,500 2.74 turns OH – 10.14

15. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Issue Requisition Form OH – 10.15 Date: ItemIssue Unit No. of Issue Units Cost Per Issue Unit Total Cost J. Walker Red1/5 L2$17.25$ 34.50 Miller Lite6 bottles/pack10$ 6.50$ 65.00 $ 217.70 Issues authorized by: J.D. Sill Comments:

16. Restaurant Operations Management: Principles and Practices© 2006 Pearson Education, Inc. Ninemeier/HayesUpper Saddle River, NJ 07458 Par Issuing System for Beverages 1.A par is established for each type of alcoholic beverage maintained behind the bar 2.At the end of the shift, the bartender places all empty bottles on the bar and completes an issue requisition form 3.The bartender takes the empty bottles along with the issue requisition to the beverage storage area 4.The person responsible for the central beverage storage area replaces empty bottles for full bottles on a bottle-by-bottle basis 5.The bartender returns to the bar with the full bottles and re- stocks the area 6.The restaurant or bar manager checks the inventory of alcoholic beverages behind the bar to assure that the bar par is maintained OH – 10.16