Food & Beverage Cost Control

Objective:

To ensure food and beverage cost incurred is reasonable, properly supported and accounted for.

1. 0 Purchase

             1.1 Quotation

           Ensure vendors selected are approved by management.

           Ensure vendor list is periodically reviewed by management.

           Ensure purchase request is properly approved by user department.

           Check quotations are obtained from vendors according to corporate
          policy (monthly/quarterly update of price).

           Match quotations with price comparison list.

           Ensure vendors are selected based on quotations submitted and, more
          importantly, on vendor’s past performance.

           Ensure quotation selected is approved by purchasing manager.

           Ensure cost plus vendor is approved by financial controller and general
          manager.

             1.2 Purchase Order

           Match purchase order to supporting quotation to ensure corporate
           policy on selection of vendor is followed.

           Ensure management has checked the estimated inventory level does not exceed the maximum inventory level. If exceeded, customer order is needed to support the purchase.

           Check estimated inventory level to past utilization rate to ensure no over purchase.

           Ensure purchase orders are properly authorized by management according to authority level.

2.0  Receipt

           Check goods received are supported by approved purchase order.

           Ensure goods received are properly inspected for quality and quantity/net weight by Receiver.

           Check goods received to ensure expiry date of product is acceptable.

           Ensure fresh/frozen/chilled food items received are marked with receipt date to alert kitchen staff of potential usage period.

           Match invoice details to goods received.

           Check casting of invoice.

           Check posting to receiving report, inventory ledger and/or accounts payable/general ledger.

           Ensure goods rejected are returned to vendor with credit note issued.

3.0  Usage

           Ensure issues for storeroom are supported by approved stock requisition.

           Perform yield test for high cost food items to ensure actual utilization rate as compared to standard utilization rate is acceptable.

           Ensure bottles and sales slips for high cost beverage items are returned to storeroom to exchange for new issues of beverage. Empty bottles must be destroyed by store personnel to avoid duplicate issue of beverage.

           Ensure portion control is properly exercised.

           Check wastage to ensure no saleable portion is abandoned.

           Ensure voided orders are not served to customers.

           Review monthly wastage to ensure wastage (in amount and in percentage) is acceptable.

4.0  Cost

           Ensure recipe and menu cost control is prepared timely and updated every six months by Head Chef.

           Ensure accurate costing before menu price is finalized.

           Ensure all food and beverage portion/serving sizes are established in conjunction with costing and pricing of menus.

           Ensure free pouring is properly monitored.

           Check food and beverage cost only includes costs incurred for revenue generating activities. Costs incurred for non-revenue generating activities (i.e. duty meal and entertainment) are treated in accordance with the nature of the activity.

           Ensure food cost percentage and beverage cost percentage, as compared to budget and/or last year performance, is reasonable. For significant fluctuation, explanation is required.

           Ensure weekly food and beverage cost report has been prepared for timely control of food and beverage cost.

           Ensure management has reviewed the monthly and year-to-date food cost percentage and beverage cost percentage.