FOOD & BEVERAGE CONTROL NOTES

Food & Beverage Control UNIT-1 Definition of Control 









Control is a process by which a manager attempts to direct, regulate and restrain the action of people in order to achieve the desired goal. An obvious first step is to established goals for the enterprise. en terprise. Probably the most common goal for all private enterprise is financial success, although this is b y no means the onlyrange goal of business. Others might relate to preserving the environment, promoting better health among the  population or etc. To achieve the goals, management must setup any number of sub goal compatible with its long-range plans. These tend to be more specific and usually more immediate in nature. For example, to achieve the goal of preserving the environment, it would be necessary to make rather immediate plans to process or dispose d ispose of waste materials in appropriate ways.

Objectives of F & B Control 







The food and beverage business can be characterized as one that involves raw materials  purchased, received, stored and issued for the purpose of manufacturing products for sale. In these aspects many similarities exist between the hospitality industries to achieve the goal of profitable operation. This will entail a discussion of how costs and sales are controlled in food and beverage operations. The means employed by b y foodservice managers to directly, regulate and restrain the actions of people, both directly and indirectly, in order to keep costs within acceptable  bounds, to account for revenues properly, and make profits.

F & B Control Cycle STEP 1: PURCHASING     

Develop purchase specification Supplier selection Purchasing correct quantities  No collusion between property and supplier Evaluation of purchasing process

STEP 2: RECEIVING  

Development of receiving procedures Completion of necessary receiving reports (e.g., addressing financial a nd security concerns)

STEP 3: STORING    

Effective use of perpetual & physical ph ysical inventory systems Control of product quality Securing products from theft Location of products within storage areas

STEP 4: ISSUING   

Product rotation concerns Matching issues (issue & usage) Purchasing as inventory is depleted

STEP 5: PRE-PREPARATION  

Mis-en-place Minimizing food waste / maximizing nutrient retention

STEP 6: PREPARATION   

Use of standardized recipes Use of portion control Requirements for food and employee safety

STEP 7: SERVING   

Timing of incoming F&B orders Portion control Revenue management concerns

STEP 8: SERVICE    

Revenue control concerns Serving alcoholic beverage responsibly Sanitation and cleanliness F&B server productivity

PROBLEMS IN F & B CONTROL -Cash control & collection -Maintenance of all costs in line with budget guidelines & current volume of business e.g. food,  beverage, payroll etc. -Maintenance of a tight & efficient control of all F & B stocks -Maintenance of up to date costing & pricing of all menu items. -Maintenance of an efficient F & B control system giving analyses statistical date of all business done. There is a dividing line between those F & B department that manage these problems & hence function more efficiently & those that just react to the problems only ever treating the symptoms & not the cause. It is important therefore that potential problem area be identified in advance by management so that they can be planned for & successfully managed when & if they occur. This is only possible if there is some feedback from the control function back to management so that they are kept constantly aware of, first changes occurring within the F & B area itself, & second changes occurring outside the establishment that may have an effect.

METHODOLOGY OF F & B CONTROL The development of an effective system of food and beverage control resolves itself into three distinctive phases PHASE-1 Basic policy decisions

Dealing with basic policy decisions. This constitutes of basic policy decisions in relation to financial and catering policies in the establishment. Financial Policy

This is where setting of profit targets are done, planning for profit margins for menu or wine list. Marketing and catering Policy

This deals with the market to be aimed at, the market you are going to cater for in order to satisfy it e.g. you have to identify the customer, his average spending power, decide what menu will satisfy the spending power, decide what menu will satisfy the customer, determine the type of service determine the portion service and choose the appropriate décor or atmosphere.

PHASE-2 Operational Control

Cycle e.g. quantity inspection of incoming good, technological procedures i.e. use of written store requisition this should be planned so as to cover the cycle of food and beverage  preparation, operational control in relation to the control cycle is. 

Buying



Receiving



Storing and issuing



Preparation



Selling

PHASE-3 After Event Control 

There must be food and beverage report: For reasons of the specific character of food and beverage operations food is highly perishable coked form or raw and always unpredictable trend and unexpected change in order to control a food operation effectively the manager must have a daily, weekly and other reports covering longer  periods.



Assessment of results:  It is concerned with an appreciation of how far the actual results of food and beverage results correspond with expected results.



Corrective action where appropriate: Any action that is taken following the receipt of food and beverage report e.g. malpractices on the park of the staffs must be corrected.

PERSONNEL MANAGEMENT IN F & B CONTROL 1. Training : Training is a process by which managers teach employees how work is to be done, given the standards and standards procedures established. Example; if management has established a standard 4 - ounce portion size for hamburgers, then all employees responsible for producing portions of hamburgers must be made aware that 4 ounces is the correct portion size.

2. Setting Example: Employees in an operation follow the examples set by the manager — the manager’s behavior, manner, responses to questions, and even a failure to speak or take action in some situations. The behavior  of individuals in a group tends to be influenced by the actions, statements and

attitudes of their leaders. Work Habits, attitudes, behavior, spirit of a manager are the evident.

If the manager who has occasion to help employees plate food for the dining room serves incorrect portion sizes, employees will be more likely to do the same when the manager is not there. Similarly, if a manager is inclined to wrap parcels of food to take home for personal use, employees will be more likely to do so. 3. Observing and Correcting Employee Actions : One of a manager’s important tasks is to observe the actions of all employees continually as they go about their daily jobs, judging those actions in the light of the standards and standard procedures established for their work. If any employee is failing to follow the standards, it is a manager’s responsibility to correct their  performance to the extent necessary at the appropriate time.

UNIT-2 COST CONCEPT •

 Accountants define a cost as a reduction in the value of an asset for the purpose of

securing benefit or gains. •

•

•

•

 In F&B Business cost is defined as the expense to a hotel or restaurant of goods or  service when the goods are consumed or the service rendered .

Food and beverage are “Consumed” when they are used, wastefully or otherwise, and are no longer available for the purpose which they were acquired.(Units: weight, volume or total value) The cost of labor is incurred when people are on duty, whether or not they are working and whether they are paid at the end of the shift or at some later date. (Hourly or weekly or monthly) Fixed Cost (FC) and Variable Cost (VC) are used to distinguished between those cost

that have no direct relationship to business and those that do. •

Fixed Cost  are those that are normally unaffected by changes in sales volume. Such as =

real estate taxes, insurance premiums, depreciation, repairs and maintenance, rent or occupancy cost, most utility cost, advertisement, professional services. •

•

The term fixed should never taken to mean static or unchanging but merely to indicate that any changes that may occur in such cost are related only indirectly or distantly to changes in business volume. Variable Cost  are those that are clearly related to business volume. As business volume

increase, variable cost will increase and vice versa. •

•

•

Food & Beverage  cost are considered directly variable cost. Direct Variable Cost  are those that are directly linked to volume of business increase and decrease of volume correspondingly.  Payroll Cost includes salaries and wages and employee benefits and often referred as  Labor Cost .

Because labor cost consist of fixed and variable element it is known as semi-variable cost , meaning a portion should change in short-term and the other portion remains unchanged.

CONTROLLABLE AND NON-CONTROLLABLE COST •

•

Controllable cost are those that can be change in the short term such as Direct Variable Cost, Wages, Advertising & Promotion , Utilities, Repairs & Maintenance  and Administration and General Expenses .  Non-Controllable cost  are those that cannot normally be changed in short-term such as

fixed cost like Rent, Interest on a mortgage, Real estate taxes, License fee and Depreciation. Unit Cost  may be food & beverage portion as in the cost of one item or hourly unit of work. In F&B business unit cost are commonly in average unit cost  rather than actual unit cost . Total Cost  are the total of food & beverage portions served in one period such as a week or a

month or total cost of labor for one period.  Prime Cost is a term used in the Hotel Industry to refer to the cost of materials and labor. (Food,

Beverage and Payroll) Historical and Planned Costs •

 Historical cost  are all cost are historical - that is, that they can be found in business

records, book of account, financial statements, invoices, employees’ time card and other similar records. It is used for establishing unit cost, determining menu prices and comparing present with past labor cost. •

It will be used for planning and determining the future to develop planned costs  projections of what cost will be or should be for a future period. It is often called as  Budgeting .

Cost percentage may vary considerably from one foodservice operation to other. This is due to many possible reasons. Basically there are two types of foodservice operation. •

Those that operate at low profit margin  and depends on relatively high business volume .

•

Those that operate at relatively high profit margin  thus do not require high business volume .

SALES CONCEPT Sales Defined

In general, the term sale is defined as revenue resulting from the exchange for products (Food & Beverage)  and services (Waiter ) for value ($$). The sales concept  in F&B operation usually can be express as: monetary and non-monetary. Total Sales is a term that refers to the total volume of expressed in dollar term for instant any

given period, such as a week, a month or a year. 





 By Category Total dollar volume of sales by category are total food sales or total

 beverage sales. Or total steak sales or seafood sales.  By Server  This is total dollar volume of sales for which a given server has been responsible in a given period. This is to help the management to make judgment on employee’s performance.  By Seat  Usually for a year’s period. Total Dollar sales divided by the number of seats in the restaurant.

 Sales Price refers to the amount charged each customer purchasing one unit of a particular item.

It can be a single meal or entire meal.  Average Sale in business is determined by adding individual sales to determine a total and then

dividing that total by the number of individual sales. Two types of commonly calculated averages are: average sale per customer  and average sale per server . 



Per Customer is the result of dividing total dollar sales by the number of sales or customer. Per Server  is total dollar sales for an individual server divided by number of customer served by that individual.

COST TO SALES RATIO Food service establishment calculate cost in rupees and compare those cost to sales in rupees. This enables them to discuss the relationship between cost and sales or the cost per rupee of sale. Cost ÷ Sales = Cost per rupee of sale

decimal answer, and any decimal can be converted to a percentage if one multiplies it by 100 and adds a percent sign (%). Cost ÷ Sales x 100 = Cost% INR 312,090 ÷ INR 891,687 = .35 and .35 x 100 = 35.0 %

Food cost ÷ Food sales x 100 = Food cost% Beverage cost ÷ Beverage sales x 100 = Beverage cost% Labor cost ÷ Total sales x 100 = Labor cost%

The formula also can be used to determine the Sales price if the cost% is known. Cost ÷ cost% = Sales (or Sales Price)

If the given cost percentage were 30.0 percent and the food cost for the item were $3.60, the appropriate sales price would be INR12.00, illustrated here 30.0 % ÷ 100 = 0.3 INR 3.60 ÷ 0.3 = INR 12.00

The formula also can be use to determine the cost if the spending power and cost% is known. Suppose this banquet manager is dealing with a group willing to spend INR15.00 per person for a banquet, and the same given 30.0 percent cost percent is to apply. Calculation of the maximum  permissible cost per person is facilitated by rearranging the formula once again: Sales x Cost % (expressed as a decimal) = Cost Sales X Cost % = Cost

So the cost per person can be calculated as INR 4.50: 30.0 % ÷ 100 = 0.3 INR 15.00 X 0.3 = INR 4.50

CLASSIFICATION OF COST There are various types of cost which are: 1. Actual Cost: The actual cost is what a cost or expenses actually was. For example, the payroll records and check made out to employees will indicate the actual labor cost for that payroll  period. 2. Budgeted Cost: A budgeted cost is what a cost expected to be for a period time. For example, for an anticipated level of sales for a month, we might budget or forecast what the labor cost should be for that period. Later, that budgeted cost would be compared with the actual labor cost in order to determine the causes of any differences.

3. Controllable Cost: A cost that can be changed in the short term. Direct costs are generally more easily controllable than indirect costs. Variable costs are normally co ntrollable. Certain fixed costs are controllable, including advertising, promotions, utilities, repairs, etc. 4. Non-Controllable Cost: Are those costs that cannot be changed in the short term. These are usually fixed costs. These typically include items such rent, depreciation, and taxes. 5. Fixed Cost: Are those that are normally unaffected by changes in sales volume. The term fixed should never be taken to mean unchanging, merely to indicate that any changes that may occur in such costs are related only indirectly to changes in sales volume. Examples: Rent, Utilities, Insurance Premiums. 6. Variable Cost: A variable cost is one that varies on a linear basis with revenue, those that are clearly related to business volume. Directly variable costs are those that are directly linked to volume of business, such that every increase or decrease in volume brings a corresponding increase or decrease in cost. The obvious variable costs are food and beverage. The more food and beverage sold the more that have to be purchased. If revenue is zero, then the cost should also be zero. As business volume increases, so do these costs. As business volume decreases, so do these costs. 7. Direct Cost: Direct cost is a cost that is the responsibility of a particular department or department manager. Most direct costs will go up or down, to a greater or lesser degree, as revenue goes up and down. Because of this, they are considered to be controllable by, and thus the responsibility of, the department to which they are charged. Examples of this type of cost would be food, beverages, wages, operating supplies and services beverages and linen and laundry. 8. Indirect Cost: An indirect cost is commonly referred to as an undistributed cost or one that cannot easily be identified with a particular department or area, and thus cannot be charge to any specific department. For example, property operation, maintenance and energy cost could only  be charged to various departments (such as linen or food and beverage) with difficulty. Even if this difficulty could be overcome, it must still be recognized that indirect costs cannot normally  be made the responsibility of an operating department manager. Indirect costs are also sometimes referred to as overhead cost. 9. Joint Cost: Is a cost shared by and the responsibility of two or more department or area. The cost of dining room waiter who serves both food and beverage is an example. His labor is a joint cost and should be charged to the food department and to the beverage department. Most indirect costs are also joint costs. 10. Sunk Cost: A cost that has been incurred and cannot be reversed. Also referred to as a "stranded cost”. A worn-out piece of equipment bought several years ago is a sunk cost because the cost of buying it cannot be reversed.

11. Opportunity Cost: The cost of not doing something or the profit lost. An organization can invest its surplus cash in marketable securities at 10 percent, or leave the money in the bank at 6  percent. If it buys marketable securities, its opportunity cost is 6 percent. Another way to look at it is to say that it is making 10 percent on the investment, less the opportunity cost of 6 percent; therefore the net gain is 4 percent. 12. Standard Cost: A standard cost is what the cost should be for a given volume or level of revenue. For example, a standard cost can be develop by costing the recipe for a given menu item. If ten of these menu items are sold, the total standard cost should be ten item the individual recipe cost. Another illustration would be personnel cost (wages) for cleaning at dining area. If the area attendant is paid Rs. 4.00 an hour, and it takes one half hour to clean the area, the standard labor cost for cleaning the area would be Rs. 2.00. While, if the service person take 7 hours to clean the area, total standard cost would be Rs. 28. 13. Prime Costs: Is a term used in the food and beverage industry to refer to the cost of materials and labor.

Prime Cost = Food Cost + Beverage Cost + Labor Cost 14. Historical Costs and Planned Costs:

Historical costs are figures that have already happened and can be found in the business records. Planned costs is made by using historical costs in the present to determine what is likely to happen in a future period to come. These numbers are also used in budgeting.

COST/VOLUME/PROFIT RELATIONSHIP The key to understand cost/volume/profit relationship lies in understanding that fixed costs exist in an operation regardless of sale volume and that it is necessary to generate sufficient total volume to cover both fixed and variable costs as well as desired profit. It should be apparent that relationships exist between and among sales, cost of sales, cost of labor, cost of overhead and profit. In fact these relationships can be expressed as follows: Sales = Cost of sales + Cost of labor + cost of overhead + profit. The relationship formula

Because cost of sale is variable, cost of labor includes fixed and variable elements and cost of overhead is fixed, one should restate this equation as follows: S = VC + FC + P

In fact this is the basic equation of cost/volume/profit analysis S = Sales VC = Variable Cost FC = Fixed Cost P = Profit. BREAK EVEN POINT

 No business can be termed profitable until all of the fixed cost have been met. •

•

If sales cannot cover both variable cost & fixed cost it is operating at a loss If sales can cover both variable cost & fixed cost exactly but insufficient to provide any  profit.

(i.e, profit = 0) the business is said to be operating at the breakeven point (BE) Changing the Break Even Point

Two ways to change Break Even point is by 1. Increasing menu price 2. Reducing Variable cost

UNIT-3 A budget  is a quantitative expression of a plan for a defined period of time. It may include  planned sales volumes and revenues, resource quantities, costs and expenses, assets, liabilities and cash flows. It expresses strategic plans of business units, organizations, activities or events in measurable terms.

BUDGETING •

•

•

•

•

•

Budgeting is part of the planning process. It can involve decisions concerning day-to-day management of an operation or, on the other hand, involve plans for as far ahead five years. Budgeting is used by most firms to aid in controlling costs and to ensure that costs are kept in line with forecast revenues. In order to make meaningful decisions about the future, a manager must look ahead. One way to look ahead is to prepare budgets or forecasts. A forecast may be very simple. For a restaurant owner/ operator, a budget may be no more than looking ahead to tomorrow, estimating how many customers will eat in the restaurant, and purchasing food and supplies to accommodate this need. On the other hand, in a larger organization, a budget may entail forecasts up to five years ahead (such as for furniture and equipment purchases) as well as day to day budgets (such as staff scheduling). Budgets are not always expressed in monetary terms. They could involve numbers of customers to be served, number of rooms to be occupied, number of employees required or some other unit rather than money.

OBJECTIVES 1. To provide organized estimates of future revenues and expenses, manpower requirements or equipment needs with estimate broken down by time period and / or department. 2. To provide a coordinated management policy both short and long term, expressed primarily in accounting terms. 3. To provide a method of control by comparing actual results with budgeted plans, and to take corrective action if necessary.

TYPES OF BUDGET Capital Budget : It deals with assets and capital funds of a business. Operating Budget : Deals with the income and expenditure of a business. Master Budget : It in co-operates all the income and expenditure plus the assets and liabilities of a business. Departmental Budget : It is done in respect to the single department of business e.g. special functions like banqueting, wedding receptions, the sales and purchases have to be budgeted for. Fixed Budget : This is a budget which is independent on the level of turnover e.g. advertising office administration, maintenance budget; this is because short-run changes in the volume of turnover have no effect on the budget concerned. Flexible Budget : Budget which provides for several level of turn-over and pre-determines cost or cash flow accordingly, for example changes in the rate of room occupancy may affect labor cost in a small hotel.

ADVANTAGES OF BUDGETING •

•

•

•

•

They involve participation of employees in the planning process, thus improving motivation and communication. They necessitate, in budget preparation, consideration of alternative courses of action. They allow a goal, a standard of performance, to be established with subsequent comparison of actual result with that standard. Flexible budgets permit quick adaptation to unforeseen, changed conditions. They require those involved to be forward looking, rather than to be looking only at past events.

DISADVANTAGES OF BUDGETING •

•

•

•

Time constraints Unpredictable future Confidential matters Spending to budget problem

BUDGETARY CONTROL PROCESS

BUDGETING FOR FOOD & BEVERAGE OPERATIONS 1. SALES BUDGET: The purpose of the sales budget is to pre-determine the volume of sales in respect to a trading period; this enables an assessment of the sales performance in a business at the end of that period. IMPORTANCE OF SALES BUDGET:

1. It has an influence on the volume of sales on profit. 2. It influences the preparation of other budgets. 3. Budgeted volume of sales will influence. -

Budget food & beverage cost Labour cost Overhead cost

4. Budgeted volume of sales will depend on -

Past performance

-

Current trends

-

Any limiting factor which may be in operation with this budget.

DEVELOPMENT OF SALES BUDGET

Factors to be considered: For each revenue produced department special 

Circumstances affecting each department.



Complete analysis of the previous years, actual sales figure for each department.



Analyses of the sales mix percentages.



A careful study of probable future trends and purchases.



Any significance change in the sales milk must be analyzed to see what effect will have on the purchase budget.



Any changed in the use of food stuffs e.g. pre-packed commodities or convenience foods must be noted and studied for effect on the cost of purchases.



Any change in supplies.

2. BUDGETED PROFIT & LOSS ACCOUNT •

This is to pre-determine in the respect to a particular trading period all the income and expenditure of a business as well as the net profit to be carried. E.g. departmental gross  profit, labor cost percentage, overheads percentage and net profit percentage.

3. LABOUR COST BUDGET •

•

Labour cost budget are budgeted for in relation to the budgeted volume of sales, the higher the volume of sales the higher the total cost of labour. A given increase in the volume of sales must not necessarily result in a proportionate increase in labour cost. When sales arising many components of the total cost of labour remain fixed e.g. management and supervisory salary. Labour costs are fixed and others tend to vary in the same direction as the volume of sales.

FACTORS CONSIDERED IN PREPARATION OF LABOUR COST BUDGET 

The number and grade of each staff in each department.



The budgeted rate of paying for each grade of staff.



Casual and part time labourers.



Cost of national health insurance.



All accommodation, holidays with pay, bonuses and commission.

UNIT-4 FOOD & PURCHASING CONTROL Responsibility for Purchasing

The responsibility of purchasing can be delegate to anyone in the foodservice operation depending on organizational structure and management policies. Control Process and Purchasing

Four steps in the control process apply here: 1. Requiring that standards and standard procedures be established 2. That employees be trained to follow those standards and standard procedures 3. That employee out-put be monitored and compared to established standards 4. Remedial action be taken as needed Perishable and Non-perishable  Perishable are those items, typically fresh foods, those have a comparatively short useful life

after they have been received. They should be purchased for immediate use only as they deteriorate quickly.  Non-perishable are those food items that have a longer shelf life. They are often referred to as

groceries or staple. They may be stored in the containers in which they are received, stored on shelf at room temperature for weeks or months. They do not deteriorate quickly. Developing Standards & Standard Procedure

Establishing control over purchasing ensure a continuing supply of sufficient quantities of the necessary foods, with each of quality appropriate to its intended use and purchase at the most favorable price. Standard must be developed for: 1.

The quality of food purchased

2.

The quantity of food purchased

3.

The price at which food is purchased

Establishing Quality Standards •

•

•

It is important first to determine which perishable & non-perishable food is required in order to produce products of consistent quality. Thus it is important to draw up the list of all food items to be purchased, including those specific and distinctive characteristic that best describe the desired quality of each in written description also known as standard purchase specifications. It is usually base on federal grading or common market grading.

Through Standard Purchasing Specification: 1. To determine exact requirement in advance for any products 2. To purchase according to specification to prepare several different items on the menu. 3. They eliminate misunderstanding 4. To have standard competitive bidding 5. They eliminate for detail verbal description 6. To facilitate checking food as it is received. Establishing Quantity Standards •

Quantity standard for purchasing are subjected to continual review and revision, often on a daily basis.

•

Perishable Item .The correct amount must be purchased to avoid wastage.

•

A basic requirement of the purchasing routine is to take daily inventory of perishable.

•

•

The routine requires that determinations be made of anticipate total needs for each item,  base on future menus and often on experience as well.  Non-perishable items does not present the problem of rapid deterioration, the do

represent considerable amount of money invested in material in storage. The goal here is to avoid excessive quantities on hand. Through proper planning.

•

The ways to maintain inventories of non perishables at appropriate levels, most are variations on two basic methods: 1. Periodic order method

A method for ordering food or beverages based on fixed order dates and variable order quantities. The calculation of the amount of each item to order is comparatively simple: Amount required for the upcoming period-Amount presently on hand+ Amount wanted on hand at the end of the period to last until the next delivery =Amount to order 2. Perpetual inventory method : •

orders for non perishables are placed every two weeks, one of the items ordered is crushed tomatoes, purchased in cans, packed 6 cans to a case. The item is used at the rate of 7 cans per week, and delivery normally takes five days from the date an order is  placed. If the steward in this establishment found 9 cans on the shelf, anticipated a use of 14 cans during the upcoming period of approximately two weeks, and wanted 10 cans on hand at the end of that period, the calculation would be: 14 cans required - 9 cans on hand +10 cans to be left at the end of the period (desired ending inventory) = 15 cans to be ordered on this date

Perpetual Inventory Method

1. To ensure that quantity purchase are sufficient not excessive 2. To provide effective control on stored item for the future. The reorder point  is quite simply the number of units to which the supply on hand should decrease before additional orders are placed. The Par Stock  means simply the maximum quantity of a given item that should be on hand. This helps to

1. Storage space 2. Limits on total value of inventory 3. Desired frequency of ordering 4. Usage 5. Purveyors’ minimum order requirements

FOOD RECEIVING CONTROL The primary objective of receiving control is to verify that quantities, qualities and price of food delivered conform to orders placed. The person that is usually responsible for this job is given the job title as “receiving clerk’. ESTABLISHING STANDARD FOR RECEIVING

Established standards to govern the receiving process are: •

The quantity delivered should be the same as the quantity listed on order forms and also should be identical as the quantity listed on the invoice or delivery bill.

•

The quality of item delivered should conform to the establishment’s standard purchase specification for that item

•

The prices on the invoice should be the same as those stated on the order form

Example of Standard procedure for receiving 1. Verify that the quantity, quality and price for each item delivered conforms exactly to the order place 2. Acknowledge that quantity, quality and price have been verified by stamping the invoice with the rubber invoice stamp provided for that purpose 3. List all invoices for foods delivered on a given day on the Receiving Clerk’s Daily Report for that day, and complete the report as required, or enter appropriate information directly into a computer terminal 4. Forward complete paperwork to proper personnel 5. Move food to appropriate storage areas. INVOICE STAMP: Rubber stamp used by a receiver to overprint a small form on an invoice for the purpose of recording the data on which goods were received, as well as the signature of the several individuals verifying the accuracy of data on the invoice.

1. Verification of the date on which food was received 2. The signature of the clerk receiving the food who vouches for the accuracy of quantity, quality and price. 3. The steward’s signature, indicating that the steward knows the food has been delivered 4. The food controller’s verification of the arithmetical accuracy of the b ill.

5. Signatory approval of the bill for payment by an authorized individual before a check is drawn.

FOOD STORING & ISSUING CONTROL STORING CONTROL: ESTABLISHING STANDARDS AND STANDARD PROCEDURES FOR STORING In general, the standard established for storing food should address five principal concerns:

1. Condition of facilities and equipment 2. Arrangement of Food 3. Security of Storage areas 4. Location of Storage Facilities 5. Dating and pricing of stored food ISSUING CONTROL: ESTABLISHING STANDARDS AND STANDARD PROCEDURES FOR ISSUING There are two elements in the issuing process: (1) The physical movement of foods from storage facilities to food preparation areas

Physical Movement of Food from storage facilities is the movement of food from the storage facilities to the preparation area. Practice for doing this varies from one establishment to other establishment due to the management policies and procedures and priority. (2) The record keeping associated with determining the cost of the food issued.

DIRECT: Direct is in-charge to food cost as they are received directly on assumption that these  perishable item have been purchased for immediate use. Figures in “FOOD DIRECT” column in Receiving Clerk’s Daily Report will be calculated directly into the particular day food cost. STORES: The food category known as stores was previously described as consisting of staples. When purchased, these foods are considered part of inventory until issued for use and are not included in cost figures until they are issued. Therefore, it follows that records of issues must be kept in order to determine the cost of stores. For control purposes, a system must be established

to ensure that no stores are issued unless kitchen personnel submit lists of the items and quantities needed. The Requisition is a form filled in by a member of the kitchen staff. It lists the items and quantities of stores that the kitchen staff needs for the cu rrent day’s production. Each requisition should be reviewed by the chef, who should check to see that all required items are listed and that the quantity listed for each is accurate. If the list of items and quantities is correct, the chef signs and thus approves the requisition.

FOOD PRODUCTION CONTROL 1. PORTIONS 

The standards and standard procedures for production control are designed to ensure that all portions of any given item conform to management ’ s plans for that item and that, as far as possible, each portion of any given item is identical to all other portions of the same item.



Portion for any given menu should be identical in 4 respect.

1. Ingredients 2. Proportions of ingredients 3. Production methods 4. Quantity 

To achieved the 4 respected areas we need to have

1. Standard Portion Size 2. Standard Recipe 3. Standard Portion Cost STANDARD PORTION SIZE 

One of the most important standards that any foodservice operation must establish is the standard portion size, defined as the quantity of any item that is to be served each time that item is ordered. In effect, the standard portion size for any item is the fixed quantity of a given menu item, that management intends to give each customer in return for the fixed selling price identified in the menu. It is possible and desirable for management to

establish these fixed quantities in very clear terms. Every item on a menu can be quantified in one of three ways: by weight, by volume, or by count. Every item on a menu can be quantified in one of the three way: 

By Weight: Can be expresses in ounce or grams used to measure portion sizes for a number of menu items.



By Volume: Is used as the measure for portion of many menu items usually that of liquid in nature, Milk, soup, juices of coffees



By Count: Used to identify portion size, such as sausage, eggs and shrimps

Many devices are available to help foodservice operators standardize portion sizes. Among the more common are the aforementioned scoops and slotted spoons, as well as ladles, portion scales, and measuring cups. Even the number scale or dial on a slicing machine, designed to regulate the thickness of slices, can aid in standardizing portion size: A manager may stipulate a  particular number of slices of an item on a sandwich and then direct that the item be sliced with the dial at a particular setting Advantages for practicing Standard Portion Size 

It helps reduce customer discontent as the customer cannot compare his or her portion unfavorably with that of other customer and feel dissatisfied or cheated.



It helps to eliminate animosity of miscommunication between the kitchen staff and the server over the portion size that lead to delay in the serving of food.



It helps to eliminate excessive costs of over portioned menu.



Price on the menu is usually fixed, thus it will also reflect the portion size of the menu. If the portion size is constantly change then it will dissatisfied the customer and server.

STANDARD RECIPE 

Another important production standard is the recipe. A recipe is a list of the ingredients and the quantities of those ingredients needed to produce a particular item, along with a  procedure or method to follow. A standard recipe is the recipe that has been designated the correct one to use in a given establishment.



Standard recipes help to ensure that the quality of any item will be the same each time the item is produced. They also help to establish consistency of taste, appearance, and customer acceptance.



The same ingredients are used in the correct proportions and the same procedure is followed, the results should be nearly identical each time the standard recipe is used, even

if different people are doi ng the work. In addition, returning customers likely to receive items of identical quality. 

ill be more

Standard recipes are also very important to food control. Without standa d recipes, costs cannot be controlled effe tively. If a menu item is produced by different methods, with different ingredients, and in different proportions each time it is made, c sts will be different each time any g ven quantity is produced.

STANDARD PORTION COS 



A standard portion cost c an be calculated for every item on every menu, ingredients, proportions,  production methods, and portion sizes have bee  previously discussed. In eneral, calculating standard portion cost merel one determine the cost o each ingredient used to produce a quantity of a item, add the costs of the individual ingredients to arrive at a total, and t total by the number of po rtions produced.

rovided that the standardized as requires that given menu en divide the

Standard portion cost is efined as the dollar amount that a standard port on should cost, given the standards and s andard procedures for its production. The stan ard portion cost for a given menu item ca  be viewed as a budget for the production of o e portion of that item. There are several re asons for determining standard portion costs. T e most obvious is that one should have a reasonably clear idea of the cost of a menu ite  before establishing a menu sales  price for that item.

STANDARD YIELD 

Yield factor is defined as the percent of a whole purchase unit of meat, p oultry or fish that is available for porti ning after any required in-house processing has  been completed.



Quantity = Number of po rtions X portion size (as a decimal) /Yield perc entage

UNIT-5 BEVERAGE PRODUCTION CONTROL •

To ensure that all drinks are prepared accordingly to management’s specifications

•

To guard against excessive costs that can develop in the production process

Establishing Standards and Standard procedures for production 

Standard must be established for the: 

Quantity of the ingredients used



Proportion of the ingredients used



Drink sizes



To have some reasonable assurance that a drink will meet expectations each time it is ordered.



If drinks are served accordingly to the formula and in standard portion, then the cost for each portion to sales should be the same.

Establishing Quantity Standard and Standard Procedures

Devices for Measuring Standard Quantities 



Four measuring devices are commonly used by bartenders: 

Shot Glasses (Plain and lined)



Jiggers (Double ended stainless steel Measuring device that resembles the shot glass)



The pourer (Fitted on top of a bottle)



The automated Dispenser (predetermined measures of liquor)

Free pour from own judgment or eyesight

Establishing Quality Standards and Standard Procedures 

Standard Recipes



Establishing Standard Portion Cost



Straight Drinks (formula)



Mixed Drinks and Cocktails (Detail Recipe)

Controlling Revenue

Possible control of problems 

Working with the cash drawer open



Under-ringing sales



Overcharging customer



Undercharging customer



Over pouring



Under pouring



Diluting bottle contents



Bringing one’s own bottle into the bar



Charging for drinks not served



Drinking on the job

Beverage Sales Monitoring 

The Cost Approach 

 



Monthly Calculation



Daily Cost Calculation



Cost Calculation by Category

Standard Cost Method (Actual – Standard Cost)

The Liquid Measure Approach 



Cost Percentage Methods

Ounce-Control Method (Quantity stock taking daily)

The Sales Value Approach 

Actual Sales Record (Recipe Detail Comparison)



Average Sales Value Method (Per-bottle value)

 

Standard Deviation Method (Statistical EDP)

Inventory Turnover

Monitoring Production Performance and Taking Corrective Action 

A manager can personally observe bar operations on a regular basis



A designated employee, such as a head bartender, can observe others working at the bar and report unacceptable performance and problems to management



Individual unknown to the bartenders can be hired to patronize the bar, observe the employees, not problems and report to management



Closed-circuit television systems can be installed to permit observation of bartenders and  bar operations from some remote location.