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Why Food Costing Software is the Solution to Your Inventory Troubles

September 9, 2020 by FoodBAM Admin

Want to know what the secret weapon is to reducing food costs? Automating your process!

Expensive to ignore and complicated to handle, controlling food costs and knowing what you are paying for each ingredient is vital. As a chef, do you know what your true food costs are? Do you know if every item on your menu is profitable? Food and beverage costs make up a significant portion of a restaurant’s budget – and every cent counts toward the bottom line.

How can food costing software can help lower your food costs? If you’re working with inaccurate inventory counts, you’re working with a bad food cost calculation. Here are the benefits of adding food costing software into your inventory process.

Food Costing Software Saves You Time

Usually a chef or restaurant owner must sit down and look at each invoice to see exactly what they are paying for each ingredient. You don’t have the time to be monitoring what you are paying, so you probably end up waiting until the end of the month or once a quarter to read over invoices and prices – which is not ideal. Food costing software can speed things up by providing everything you need without having to check multiple price guides and make numerous phone calls.

Monitors Price Fluctuations

Ingredient costs fluctuate each week. When you know how much your menu items cost you to make, you then know what price to sell each item at. Food costing software works for you by automatically adjusting prices as they change – it knows every product in your walk in and what you paid for it. If the price of chicken goes up, so does the cost of your world famous fried chicken sandwich – and you don’t have to do any manual updates.

If you notice an ingredient falling in price it may be a good time to put it on your menu as you are able to make more margin on that menu item.

Make sure to use consistent and standardized recipes to calculate food cost. Let’s say you put 5 ounces of pork on a sandwich, but another cook puts 8 ounces of pork – how do you calculate the actual food costs? It makes it very difficult. By standardizing your recipes, you can streamline the food cost process.

Reduce Food Waste

One of the most direct ways to reduce food cost is to avoid purchasing what you don’t need. If you have too much of an ingredient on hand, you may have to mark down a menu item or risk spoilage and waste. By understanding trends and sales patterns, you can improve your order accuracy by taking corrective measures to right-size your inventory. This will help to reduce costs by eliminating as much food waste as possible. With food costing software, you can ensure you are purchasing inventory at the right level to reduce order waste.

What Food Costing Software is the Best?

You wouldn’t expect any other answer than Foodbam, right? You didn’t think we were going to send you somewhere else did you? Not only does Foodbam provide real-time recipe cost updates and real-time pricing with the ability to compare prices across multiple vendors, but we offer SO MUCH MORE. From accounting and receiving, to reporting and analytics, we are your one stop shop back-of-house technology solution. Request a demo today!

To learn more, we sat down with one of our restaurant technology experts to discuss how restaurants can utilize technology to control costs. Click the video below to watch.

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Chef/Owner at Stars on Hingham Harbor in Hingham, MA

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