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Saturday, March 07, 2009

Setting Food Cost Priorities

I was asked this question at a job interview and hope that I got them right. What is your take on this question?

Food quality control, food cost control and personnel supervision are three important responsibilities of this position. Please prioritize these in order of importance and provide your reasons.


I would put these three important responsibilities in the following order:
1. Personnel supervision is number one because people make the entire business model work. It's impossible to hit your objectives if you are lax with supervision.
2. Food quality control would be my second priority because quality drives sales. You can hit every other number in a restaurant and if the quality is low you're in danger. So now we have qualified, well supervised staff producing high quality menu items.
3. Let's make some money now that our guests are happy with the service and food quality. Food cost control will help insure proper portion control, lower waste, optimal stock levels (freeing cash frozen on your shelves), and optimal blend of ingredient price and quality.

On the quality issue, it's often possible to meet the food quality control and food cost control objectives simultaneously. I shop at Whole Foods for many items due to family allergies. They have a private label called 365. The 28 ounce can of the 365 label canned peeled whole tomatoes costs $1.39 here in Virginia. This is a premium over other local markets. You may pay as little as $1.09 for the same size can. When you cost the canned products by the tomato, the Whole Foods 365 label comes up a winner. Each can averages 12 tomatoes. Some of the cheaper brands have only 7 or 8 tomatoes and plenty of water or tomato juice.

Would you rather pay $1.39 for 12 tomatoes or $1.09 for 7.5 tomatoes? You pay 25% more when you buy the cheap brand.

This analysis is 100% tomatoes to tomatoes. The size is almost identical.

1 comment:

Ralph said...

Great answer. I know you focus in on cost control, but it seems to me personnel supervision is the #1 cost control issue...but it also the #1 revenue generator.

In this economy, I believe restaurants overlooking the obvious.

I'm still eating out. Just not as many places. I make it an occasion, and still spend a fair amount of money.

But I only go where the food AND service AND atmosphere AND value...are all excellent.

I'm believe many of the restaurants could thrive in this recession/depression by focusing on these items. I know these items make up more than 1/2 of the costs of running a business. Why wouldn't business owners focus their energies on this?

But instead I keep seeing chefs/owners reducing the wrong items: food quality, food freshness (localness), portions or service.

I was just in Vegas. All of the casinos and restaurants and employees have gotten the message. Every single person was extremely helpful and grateful for my business. I thought I was going to get a kiss for just a $2 tip. I loved the service from the waitress to the pit boss.

I would ask every restaurant owner: do you have the best possible server, captain, busser, hostess working for them? Are the best possible trained employees out front positively representing the restaurant?

Are you unequivocally proud of every single employee?

If not, then your employees are driving your business into bankruptcy.

Now ask yourself the same about atmosphere, cleaniness, quality and value.

Am I the only person in the restaurant concerned about these factors?

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