Restaurant Operations

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Restaurant Operations
C H A P T E R
C H A P T E R
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After Reading and Studying This Chapter, You
Should Be Able to

• Apply the forecasting technique used in the
  chapter to measure expected volume of business
• Name and describe the various types of services
• Explain the important aspects of food production
• Describe the key points in purchasing, receiving,
  storing and issuing
• Explain the difference between controllable
  expenses and fixed costs
• Explain the components of an income statement and
  operating ratios
• Describe the important aspects of a control
  system for a restaurant operation
• Outline the functional areas and tasks of a
  foodservice/restaurant manager

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Front of the House

• Front
• Curbside Appeal
• Organizational chart
• Dining Room Manager
• Hostess
• Servers
• Bussers

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Restaurant Forecasting

• Forecasting
• Budget projections
• Revenue
• Guest counts or covers
• Meal periods
• Day of week
• Special holidays
• Average guest check
• 13 periods a year

The process of estimating future events,
combining intuition data
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Food and Beverage Occupancy Statistics

• Occupancy Statistics
• Cover A guest
• Number of Turns
• Number of Covers
• Number of Seats
• Example 150 covers 3 turns
• 50 seats

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Average RestaurantCheck

• Average check
• Food and Beverage Sales
• Number of Covers
• Example 4,000 FB sales 26.67
• 150

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Service

• Service
• Guests want less formal yet professional
• Training is necessary
• Servers are salespeople
• Suggestive selling
• Achieved through training and practice
• Suggestions to achieve a high level of
  effectiveness
• Provide incentive feedback
• Provide training on food wine
• Incorporate role-playing
• Promote up selling
• Train servers as commissioned sales people

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• Service Script
• Anticipated sequence of interactions implicitly
  held by both the service person and guest
• Menu
• The foodservices operational plan for meeting
  the needs and expectation of its customers

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Types of Restaurant Service

• Several positions
• Maitre d hotel
• Dining room Manager
• FB Manager
• Chef de Salle
• Head Waiter
• Chef d estage
• Captain
• Chef d rang
• Front Waiter
• Demi chef d rang
• Back Waiter
• Sommelier
• Wine Steward
• Chef de Vin

• French Service
• Usually in haute cuisine restaurants
• Use of a gueridon
• Final preparation is at tableside

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Types of RestaurantService

• Russian Service
• Food is cooked in the kitchen
• Dish is presented to the customer
• Served individually by placing food onto the
  plate

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Types of RestaurantService

• American Service
• Food is cooked in the kitchen
• Presented to the guest on individual plates
• Defining good service
• Who ordered the fish?

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The Production Cycle
BOH

• Production Cycle
• Purchasing
• Receiving
• Storing and issuing
• Food production
• Stewarding
• Budgeting
• Accounting and control

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Food Production
BOH

• Food Production
• Based on expected volume of business
• Prep work done prior to service times
• Kitchen layout
• Cooking line
• Teamwork
• Staffing and scheduling
• Training and development
• Management involvement
• Employee recognition

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Production Procedures
BOH

• Procedures
• Production sheets
• Count the product on hand (par levels)
• Determine production level
• Determine actual sales
• Key to consistency and quality of food

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Purchasing
BOH

• Purchasing
• Use of standards (product specs)
• System of control for theft and loss
• Par stock and reorder points
• Who will do the purchasing?
• Who will handle receiving and storage?

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9 Steps to Ensure Wise Buying

• Develop needs
• Develop quality SPECS
• Select purveyors
• Organize deliveries
• Par stocks
• Purchasing inventory
• Forecast contingency needs

• Take market quotes
• Maintain a purchase log

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Receiving, Storing, and Issuing

• Receiving, Storing, and Issuing
• Time and date delivery is to be made
• Point of controls
• Authorized requisitions
• FIFO

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Budgeting

• Budgeting
• Fixed costs
• Constant no matter what the volume
• Rent/lease payments
• Interest
• Depreciation
• Variable costs
• Fluctuate with volume
• Payroll
• Music and entertainment

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Balance Sheet

• Balance Sheet
• Use of USAR
• Uniform System of Accounts Restaurants
• Shows assets and liabilities at a specific date
• For a specific period of time (monthly)

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Operating or Income Statement

• Operating Statement
• On a monthly basis
• Prepared after a sales forecast
• Food and beverage sales
• Cost of sales
• Gross profit
• Controllable expenses
• Net income

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Food Cost Percentage

• Food Cost Percentage
• Opening inventory
• Purchases are added to opening inventory
• Subtract returns, spoilage, and complimentary
  meals
• Subtract closing inventory
• Final number Cost of goods sold

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Food Cost Percentage

• Food Cost Percentage (cont.)
• Recap
• Food Cost / Food Sales X 100 Food Cost
• 2.50 (food cost) 37
• 6.75 (selling price)

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Contribution Margin

• Contribution Margin
• Amount a menu item contributes to the gross
  profit
• Difference between cost of item and its sales
  price
• Example
• Cost of chicken is 2.50
• Selling price is 6.75
• Contribution margin is 4.25

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Typical Cost Percentages

• Cost Percentages
• Labor costs 20 to 24
• Food costs 28 to 32
• Beverage costs 18 to 24

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Lease and Controllable Expenses

• Expenses
• Lease cost should be 5 to 8 of sales
• Typically also pay for insurance, utilities, and
  commercial fees
• Controllable expenses are also variable expenses

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Controls

• Controls
• Loss of 20 billion a year due to theft and cash
  mishandling
• One out of every 3 employees will steal
• 35 of restaurants fail due to theft
• 75 of missing inventory is from theft
• 73 of all job applications are falsified
• Use of POS can solve some problems

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Restaurant Manager Job Analysis

• HR
• Recruitment, orientation, training, scheduling
  for shifts, supervision, employee development
• Financial Management
• Accounting cost controls
• Administrative Management
• Scheduling, coordination, planning,
  communication
• Marketing Management
• SEE NEXT SLIDE!
• Operations Management
• Day to day activities of running a business

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Marketing Segments

• As with any business the foodservice industry
  must meet the needs and expectations of its
  guests in order to be successful
• A sub-group
• Cant be all things to all people
• Classic Market Segments
• Geographic Location
• Age
• Ethnicity
• Social Class
• Price

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Trends

• More flavorful food
• Increased takeout meals and home meal replacement
• Food safety and sanitation
• Guests becoming more sophisticated

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Trends

• More food court restaurants
• Steakhouses are again popular
• Segments are splitting into tiers
• QSRs in convenience stores
• Difficulty in finding good employees

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A Very Useful Website

• www.ccccd.edu/hospitality
• http//whendidithappen.com/restaurants/1910