“Our cost of goods reduced by 5%, our inventory holdings halved, our wages cost reduced by 2% and our staff retention rates improved. This process works!"
Jamie Forsyth | Owner
The Truth of the matter is.....
Even if your volume has increased over the last year, increasing net-net profits should always be your number one priority. While you may not have any control over the weather, the outcome of the World Series, or the price of gasoline, you should have control over what happens within the walls of your food service operation. Successful businesses have systems in place to ensure control, and ultimately, profitability.
When Ray Kroc started McDonald's his goal was not to have the best hamburger in town, just the best system.
Commodity pricing is the norm for the food service industry. Lettuce is $12.00 a case one week, $26.00 the next. The Yellowtail Tuna you special ordered at $6.00 a pound comes in at $6.50--did anyone catch it? Foam cups are a petroleum-based product, and they mirror pump prices.
The bus boy you have checking in deliveries is best friends with the driver of the produce company. The waitresses and cooks get together for cookouts at least once a week and rave about the filets. The chef spends all morning getting the lunch specials prepared, punched into the POS and prepping the wait staff----yet makes up a price off the top of his head.
Systems work in every food service operation:
Businees & Industry
When food cost goes up, the GM blindly throws darts for a couple of days and then it's back to business as usual. Food Service Directors agonize over whether or not to feed a tenth grade student who has forgotten his/her lunch money-- yet will serve 10,000 lunches and not know if the cost of the Type A lunch is 65 cents or 85 cents.
My name is Mitch Johns, the head coach of Food Service Solutions. We are a food service software systems provider, consultant and integrator for both retail and institutional food service. In my twenty years of implementing food service-restaurant software systems and providing back office solutions for restaurants, caterers, K-12 schools, college-university dining, correctional facilities and health care.....
I am amazed at how much money is left on the table every day--and I'm not talking about tips.
What I am talking about is SHRINKAGE. Shrinkage is LOST PROFITS. In the hospitality industry this number in dollars often exceeds the net-net profit of the operation.
Shrinkage, by definition, is the difference between what you used today in your operation and what you should have used based on your plan. In a perfect world you would get paid for everything you used and your employees would ensure that the customer only received what he or she paid for. No mistakes, no over-portioning, no spoilage, no theft, no short weight deliveries...... food service nirvana.
Shrinkage robs owners and operators of what is rightfully theirs. Typical median shrinkage in food operations is 7.4% of sales. That amounts to $74,000.00 per year in a million dollar operation. More than enough to pay someone to do nothing but find out the who, what, when, where and how shrinkage is occurring. Failure to control shrinkage often results in a "business closed" sign for retail restaurants or "food service management contracts" in institutions.
LET'S GET THIS OUT OF THE WAY UP FRONT.
Finding this $74,000.00 is not for the undisciplined. It's not for the folks that ended up right here, right now who are looking for something for nothing. If you did an Internet search for "free or cheap inventory, menu and/or restaurant software," please hit the "Back" button and shop elsewhere.
So let me guess why you might have ended up right here, right now.
Your tables are filled every day and you have a 30-minute wait on the weekend. A short week for you is 80 hours and there still isn't enough money to pay the bills. (But all your customers shook your hand and told you what a great meal they had!)
You bought one of those “cheap” restaurant software packages that "did it all" and despite diligently entering data 10 hours per week the numbers don't add up and you are wasting your time. (Was it REALLY cheap?)
Your owner told you to search the Internet and find him a "silver bullet" some software package that did it all including taking out the garbage for $500 including training and support. (“Silver bullets” only work in Werewolf movies.)
Finding this lost profit is a lot of hard work up front. What we have to offer is a whole lot more than menu planning or inventory control or restaurant software.
MORE THAN SOFTWARE, WE OFFER A SOLUTION.
The system is based on a food cost formula and the software is called FOODCO. If you are truly interested in protecting your investment and taking home more money at the end of those long arduous days, read on.
The FOODCO software, originally written in 1982 for an Apple computer, has undergone numerous revisions, but the food cost accounting principles remain unchanged. This institutional restaurant software is logical, addresses all of the nuances of food service and makes users money by providing a system to measure their operation by. But it's not free.
Cheap? That's a relative term. If implementing this solution brings an extra 4% of sales to your bottom line this year, it's probably "cheap". We have systems starting at $4000. An operation doing $500,000 in annual sales will typically recover their investment within the first 6 months.
Put in perspective virtually nothing you purchased for your business last year will return your investment as quickly as implementing the FOODCO system in your operation. As one of my original clients claims "It was the best business decision I have ever made." Another with 8 theme restaurants in the DC metro area calls it, "a grand slam."
Well, the last six people I talked with on the phone about how often they take inventory replied "occasionally" or "not often enough". All six had a full service bar and $10,000.00 plus in inventory. When asked how often they would count a wallet with that much cash they replied "at least once a day".
Our company provides you the game plan to implement the solution. We are your trainer, coach and if needed, pinch hitter. Food service is a tough business and you better believe if you work with us, we're going to be tough on you. What's that mean?
Obviously. If the value of your inventory isn't important to you, the owner/manager, how important is it to that $7.00 per hour utility person? He knows if you know, and if you don't, only need and opportunity separate an honest person and a thief. FOODCO can be that "lock" that keeps honest people honest.
Who in your operation has the most to gain from implementing the FOODCO system? The same person who has the most to lose if costs are not kept under control. Many operators ask, "what should my food cost be"? The answer is, "How much profit do you want to make"? As a food service operator you probably work 60-80 hours a week and deserve to make a good return on your investment.
The Arirang Hibachi Restaurant Chain in New York City needs to run a 22% food cost in order to make a 14% return. A family dining operation within walking distance of my home, used to run close to 40% food cost before implementing the FOODCO software. They now maintain <32% and return 15% to the bottom line---and have increased sales in each of the last ten years. Your food cost needs to be one that allows you to make a good return on your investment. The first principle of the FOODCO software system is "Planning Your Profit". I'll tell you how to get this plan for free in a minute.
The system works. The system works so well that your restaurant will begin to benefit from FOODCO from day 1. The systems implemented in the first 30 days result in and create a tremendous difference in control, both real and perceived. If someone thinks you know, then you know.
In the food service business, the value of perceived control, with close to or at minimum wage employees, is priceless. The numbers the FOODCO system produces are the real control--the processes and systems implemented to obtain the information is the perception.
The more systematic the approach, the more consistent your operation becomes, the more time you have to discover the nickels and dimes that are left on the table (not tips) or in the garbage cans. Since every item on your menu has a planned food cost you might find a nickel on the french fry plate(s) as one of my clients did. Not a big deal but this nickel was served 2200 times a week and $5200.00 annual savings was pretty good payoff for a couple of hours of hanging out in the kitchen with a scale. The solution to this over portioning problem?: change the plate size. (Ever notice how fast food restaurants hand over a package of fries that is overflowing? That's a standardized portion presented as a perceived extra value!)
The FOODCO difference is the system. The system of planning-setting targets-counting-computing-reporting-interpreting-problem resolution is driven by the software procedures. It isn't a point of sale system or an accounting package. It is the bridge.
Without this bridge, you are forced to swim across the bay rather than drive. If you are a strong swimmer, you make it to the other side through sheer hard work, determination and perseverance. If not, you may be treading water, floundering or going down for the first time.
If you're looking for the bridge that takes you from where you are right now to the profitability highway don't buy software......buy a system.....one that ensures profitability.
I told you I was going to give you step one of the system and here it is. The first step is also the title of this web site. Step one is called "Plan Your Profit".
Are you ready to explore the system further?
What would a 4% improvement in net-net profit bring to your bottom line? How soon do you want to get control of your operation & spend less time increasing net profits.
We have a system to recover lost profit and look forward to sharing it with you.
Call us today 1-800-425-1425 and in six months you'll look back and realize that this phone call was "one of the best business decisions I've ever made".
Looking forward to a prosperous 2012.
Mitch Johns, President
Food Service Solutions
Talk to us. We will help Plan Your Profit.
We provide proven methodologies used throughout the food & beverage industry for controlling and managing inventory, purchasing, receiving, recipe costing and more!
Reduce Overproduction & Waste
We help build recipes in a manner that cooks understand all the while helping you determine the product needs and true cost of your recipes and/or meals.
Increase Employee Productivity
Trimming seconds, minutes and hours off the many tasks needed to run an efficient operations is what we are all about.
We work with you to maximize menu performance and provide you with the most comprehensive, and dynamic back of the house food & beverage management process available!
Penn Cambria School District in Cresson, PA implemented the system and has decreased their cost per meal by 6 cents serving 2100 meals per day--savings of $22,000.00 per year. By standardizing their recipes in all six buildings and putting together a menu planning team, the district has increased participation through menu diversity, quality and consistency. This effort has resulted in a spending increase of .50 cents per day, per student---or $20,000.00 per year. At Penn Cambria they get to have their cake (decreased cost per meal) and eat it too (increased revenue).
The Baltimore City Detention Center used the software to trim 4 cents per meal. But with 10,000 inmates, 3 meals per day times 365 days it amounts to savings of $438,000.00 annually. Look at the median meal cost, set a goal and find the combinations that work without compromising quality or perceived value. In food service, perception is reality.
The Great American Restaurant Group with eight restaurants in metro DC saves only 1.8% of sales but with a volume approaching $55 million the dollars are very significant. Savings of $1,000,000.00 per year. Chris Osborn, the CFO of Great American calls his decision to implement the FOODCO food cost system "a grand slam".
Restaurant Software & Institutional Management Solutions
(it may seem like a lot to read but it's worth it)