New job as the Sous and I inherited a WAY out of whack food cost %
It it a country club? That sounds high but if labor is very low maybe that's where they have things spec'd. Hard to make any big sweeping changes without consulting Chef.
2 Were you hired specifically to lower food and labour costs?
Like Buba, I'm curious as why the Chef is allowed to get away with 41% food cost, and I can't really comment until I know a bit more about the place.
For now, I'd personally implement small changes.
Personally, I'd lay low for a few weeks and just watch and evaluate. See what's going on in the kitchen. Myself, as a Chef Consultant, can walk around a kitchen for a week and be able to find many sources of "Bleeding Money." Personally, I'd start with a menu analysis and vendor pricing. look to see if waste is an issue and then see if the current chef has a business of his own going on...on the side and using that restaurant product. But that is a good question thrown out there, why is the Exec. Chef still have a job with such a high for cost? Somethings definitely up.. After you've observed for a week or so, then you an get into things a little better than what I've suggested here. The only reason I threw the "Is the chef running his own business" thing in there is because in the last 5 years of consulting, i've run into that a half dozen times...lol
Edited by Justa Chef - 4/12/16 at 8:04am
Whatever food cost that you would like to see, may not be applicable here; the owners might have a different vision. You shouldn't make business decisions for someone until you understand their plans and goals. You need to be on the same page as the owners.
One time, I worked a new start up that quickly became hugely popular and successful. It was a dinner restaurant with an adjoining lounge with Las Vegas style entertainment. On the weekends we would have a two to three hour waiting list. At one point I asked the owner why our prices were so low (and subsequent food cost so high) and his answer was to point to the waiting list and then to point to the lounge "that's where I make my money, the attractive vehicle is the food, the engine that drives the finances is the booze."
The first question to ask is what is the projected desired target food cost on the budget. From there you would have a better idea of what direction you need to proceed.
I kinda agree with the above posts. If it were me, the first thing I would do is to make sure the FC is accurate. Request every detail of how it is calculated. Not what's printed on a piece of paper or program.
Like @Justa Chef says. I would move slowly. There is an underlying factor for the owner/manage to accept this for a period of time. You never know, the owner may be stepping on it. Once you have the calculation factors, go back and see if you come up with the same numbers from past reports. If there is something going on, they probably want you to find it and identify the hole. Then whoever is stepping, can offer an explanation to see how you react. Some owners find FC is a good hiding place to skim. Sometime for personal use or even involve the Chef, maybe covering some type of bonus or payment plan. You should take the role of a Private eye. If you find a whole, the person responsible will usually be the one insisting the FC be addressed. If the hole turns out to be kitchen related, waste, inventory control, etc. Never accusations always questions. Just my 2 cents
It's got to be obvious to them that the FC, especially with banquets should be lower. I've also learned there is no set number for FC. If an operation runs a higher FC and is profitable. You may be able to tweak it but you'll probably not be able to greatly change it. Portion control may be the factor, but it might also be the draw for repeat business. You can't just start whacking portions.
I agree with @Panini...Lots of Factors involved. When an owner approaches me about BOH problem I sit him down and tell him of a 5 week plan I have. The first 10-14 days I go in covertly...undercover boss so to speak. I act like a dumb ole line cook and observe thall selects of the kitchen systems, ask questions, evaluate the chef and listen to what the the employees are doing and saying. Covertly is the easiest and quickest way to get the answers you seek. Will it piss of people...only if they are hiding something. I gather more information in those 2 weeks than I could if the BOH help knew why I was there. As soon as they know they are being watched...bang....they play it by the book. Be the wolf in sheeps clothing and you'll find out more. When all is said and done, be part of the solution not part of the problem. Obviously you can't do that now, but you can still watch. If large portions is the scene, then a menu analysis is due. Show the boss that this is a major source of lost revenue, then you're on your way...just know how to fix it when he asks you
Before you do anything you should take a look at the following:
1) How is food cost calculated?
2) Sales. See if it adds up.
3) Invoices vs. inventory. ie., who is checking in the order, did they really ship all of that or are you getting scammed?
My questions would be:
What's your food cost goal or budget and who sets it?
What's the bottom line like?
How long has the restaurant been open?
Look in the trash can. It sounds odd, but examining the trash can tell a story. If there's a lot of food coming back on the plates, then your portions are too big. I worked in a place where I could have run another restaurant with just what was in the trash can. Most of their problem was poor timing resulting in constant refires. Is staff throwing away things that could be reused, such as sour cream and butter packets? They add up fast. Are they scraping containers out? I had to get on my people about that. They'd throw away a dressing jar with 4-5 portions still in it because they were too lazy to scrape it. Watch what the staff is doing. I had one that when she cut romaine would throw away all the dark green leaves because she thought they didn't look good. Another one threw away the light green hearts because she herself didn't like that part. Between the two of them, they'd throw away the whole head. I worked one place where the food cost was high, but there wasn't much we could do about it. It was a seafood and steak place where all the food was high priced. It was only open for evening service, so there was no lower breakfast or lunch costs to offset the high priced inventory. We were backed into a corner the last couple of years because I had been telling the owner we needed to raise prices but he didn't want to do that because the place was in bad financial shape when I took it over and he didn't want to alienate customers. The financial woes were caused by poor customer service and poor execution in the kitchen. He brought me in to keep it running with the intention of selling. We corrected the problems and had double digit growth in 2009. When I left in 2014, he'd had his highest grossing year in the 22 years he'd owned the place. When shrimp nearly doubled in price in 2013 and didn't come down, he finally had to do it. It got to be too stressful for me and I finally left. Shop your suppliers. I had one supplier they dropped after I left because they didn't realize the reason I bought form them was they were $3-4$ less per pound on the same brand of crab legs as the other suppliers. that was $60-$80 per box difference! Same with steaks. I bought from a smaller independent meat company and saved $2-$3 per pound on rib-eyes and NY strips compared to the broadline suppliers. The industry in general preaches percentages, and suppliers preach $$ in the bank. The reality is a little of both. If someone is selling a burger at 30% food cost and making a gross profit of $3 compared to a steak at 41% that grosses $8, the steak is making more overall profit even though the food cost is 11% higher. Lots of angles for you to look at.
Edited by greyeaglem - 4/12/16 at 4:23pm
Probably the biggest things you can do right off the bat:
-Are your portions too big? If you send out a lot of to go boxes and/or lots of food comes back on the plate, you might have a problem. It would also effect potential dessert sales and app sales. You WANT as many people as possible to order 3 courses. Most won't, but a higher % helps FC, especially if you are wasting/tossing lots of desserts.
--Are you throwing away lots of food? Like greyeagle said, look in the trash can. Is the staff making a lot of food to eat themselves? What are you doing with the trim? Are you over-ordering or over-prepping?
--Are you cooks and other stealing from you?
--Are your menu items priced appropriately? This is a big one and where a lot of people go wrong.
It sounds like form your post you have a decent grasp on what you'd need to do to lower cost (making specials, proper portion control, etc). Unfortunately there is no magic that will make it come down super super fast, but if you evaluate carefully and identify problems you should see results soon.
Tell us more about the restaurant, more info=more help.
@Zaxmyth , the reason I suggested moving a little slower is basically there are no tricks. Your question can't be answered. People can suggest things they may do to observe or find holes. The only trick is to learn your system. No one here can give you advice if we have no understanding of your operation. I have been in many houses that run 40+% food cost. Like I said, there is not a specific number that can be used as an umbrella. I've worked houses where the Rooms support the Kitchen or vice versa. Tricks are used when owners or management use a classic or basic FC calculation that can't be realisticly achieved because it just doesn't fit the operation. I've worked very large properties where we were supposed to use the same basic calculation as a really small property. Due to banquets 5000 to 8000++ people,plus outlets and room service, the different departments, main, banquet,outlet,pastry,stewarding, etc. we would have to sandbag inventory to achieve the numbers that were requested. I'd sometimes would hold 2000 lbs. of frozen seafood in my pastry freezer for banquet during inventory.
On the private club side, it's usually member driven. So you're budget may be greater then you need. Newbie Club Chefs like to show off there FC skills and finish the year very low. A seasoned club chef knows not to do that because your finish is probably going to be reflected in your next years budget.
I'm not sure if I'm making any sense. If and when you find a hole, analyze it. Like I said, no accusations, just question. Say you find many holes on your line. If you make accusations it could undermine your respect. Also remember, if you find a very obvious hole and it's caused by human actions, if it's been going on for a long time and no one has addressed it, human nature establishes it as law. A person cannot be found guilty if he or she is not aware of the consequences. Just some more 2 cents. Like @Someday says, more info=more advice.
Have you spoken with the chef and the owners/GM yet? Do they see a problem? What is their target?
I don't know anything about your place, but I think something like staff food isn't as big a deal as something else. If you are running a 40+% FC then something bigger like pricing is most likely out of whack. Again, depending on the business model it is not necessarily a terrible thing....though I agree on paper it sounds bad.
Are the line cooks using waste sheets? If not that's a big thing you need to start. Walk around during prep and service and look in the garbage cans- what is getting thrown away? Along the lines of what GrayEaglem said there's a reason the big chains call the rubber scraper "the Million Dollar Tool"! A really big chain would throw hundreds of thousands of dollars of product if not millions away if they didn't thoroughly squeege out every bit of mayo, dressing, peanut butter, etc.
Overordering is a biggie, too. If you constantly wind up throwing away the tail of a case of lettuce, the last quarter of a case of pea pods, etc then maybe you're keeping stock levels too high.
How long has it been since the menu has been analyzed for costs? Good example- the cost per pound of the salmon I serve has increased almost two dollars over the last three months! Beef will fluctuate a lot seasonally, often by several dollars. Is stuff being bid consistently or do you just pay whatever Sysco wants to charge? Do you have several vendors that bid against each other or are you stuck with one supplier?
I just want to add again. Have you identified all contributing factors involved in the calculation, and have you reviewed a previous itemized report that identifies every factor and made sure all of the figures added up to the same outcome. I have encountered high FC before, and it was not so unusual, especially with private ownership, that there would be unidentified expenses. It's getting economically harder to survive and there are a few people who hit FC because of the difficulty of tracking from outside. I have seen FC that we running 50% only to invetigate and find the actual
FC was 25% and the owner was hitting it for another 25%. Owners and some Corps do this because it usually doesn't raise a red flag with Gov. Many other businesses run 50% cost so it's not out of the norm. It's very common for retailers to buy in merchandize at 50% and survive off the other 50. Usually because of labor and production. Take my bakery for example. It's really not compatible to some of the other food service businesses. A restaurant will buy in a steak, cook it and serve, where as in my world, we have to make the steak/cake, cook it and serve. So basically we are manufacturing and retailing. So my actual FC is quite lower then the restaurant but comparable with all the factors. That's my reason for expressing there are not standardized figures in food service, only in specific venues. If I ran a actual FC of 30%, I wouldn't last a week. I need to be in the 15-17% area for retail and lower for wholesale/wedding cake sales. just sayin
I would tear apart a previous report. Take every entry and run it against sales. I wouldn't ask for sales figures, I would learn how to produce a detailed itemized accounting of sales from your POS system. just sayin, Sometimes when you can't identify large holes, you will spin your wheels and waste time if something else is going on. If there was something else not FC related going on, your time spent would be like pissing into a fan.