How are we short?

July 26, 2011 | by D. B. "Libby" Libhart

"What? What do you mean we are out of product? Did you check the cooler and stockroom? How could we be out? I know I ordered plenty and checked it all in. What happened to it?"

So goes a mysterious disappearance of a food item. A negative hit on food cost and of course – profitability. In effort to track and prevent this type of loss, we start with answering this question:

The main food item that has the most mysterious disappearances or is most often stolen in my restaurant is:

1. Desert items

2. Chicken strips/wings

3. Bacon

4. Hamburger patties

5. Cheese

6. Other

What was your answer?

If you answered the question, how do you know? Are the losses identified by inventory control records, audit processes, anecdotal information or calculated guesses? Once you have identified what item or items are most stolen or have very high associated negative food costs, the process to mitigate or prevent the losses can begin. Establishing the norms of food cost for each item in your restaurant and routinely tracking them will assist in identifying issues when unacceptable variances and shortages occur. After you know which items are most stolen, you can then do something about it.

Inventory counts: Effective inventory control involves a systematic approach to counting inventory and ordering properly. If you know the quantities on hand for each product with routine audit counts, it will greatly assist in ordering effectively and readily identifying missing items. Assign a responsible and accountable person to conduct inventory counts and food orders. Periodically audit the inventory counts and food orders by the assigned person.

Security: Inventory control will be enhanced by limiting access to the refrigerated, freezer and dry-goods stock areas. Secure access to the back door. The door should be kept locked and openings limited to authorized personnel only. If the back door is alarmed, it should be turned off before opening by a manager only. The most effective back door control is by granting access to only the manager on duty.

No answer?

If you didn't know the answer to the above question, initiate establishing normal guidelines for acceptable negative food cost, start an audit process of food items, limit access to food storage areas and secure the back door. It will be a start to a more comprehensive loss-control program in your restaurant and eliminate the frustrations of mysteriously running out of product. The profitability of your business depends on it.

Topics: Loss Prevention , Operations Management

D. B. "Libby" Libhart / D.B. “Libby” Libhart has more than 30 years of experience in the loss prevention industry. He has provided security and safety leadership in retail settings such as department stores, drug stores and quick-service restaurants. Before launching his own company, LossBusters, Libby served as the Senior Director of U.S. Security and Safety for McDonald’s Corp. He entered the QSR industry with Taco Bell and subsequently YUM Brands.
www View D. B. "Libby" Libhart's profile on LinkedIn

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