How to limit the differences between real and theoretical consumption?

You had foreseen a theoretical material cost of 30% and finally it is 32%, why? Because the difference between actual and theoretical consumption is such that it impacts your material cost. So, what are the potential causes of this consumption gap and how can you reduce it?

Florent Boulanger


February 2023

Reducing inventory gaps in the restaurant industry: our tips | Inpulse
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Today, more than ever, restaurants are looking for ways to optimize their inventory management to reduce their material costs and cope with inflation. By closely analyzing what is happening in inventory, we are able to identify discrepancies between what should have been consumed and what was actually consumed. If the real cost of your foodstuffs is higher than expected, here are the potential causes to better prevent them:

1. Reduce food waste

There is always a portion of food that can go to waste. This can come from: 

  • a mistake in the kitchen, the cook or the waiter made a mistake in the order
  • of a product that falls to the ground or is inadvertently burned, which is called breakage
  • an expired use-by date due to over-ordering

All these products will end up in the trash and should be accounted for as losses.

An average loss rate is generally around 2% of the turnover, if you have higher losses, your supplier ordering process is not optimal, you must act. At Inpulsewe have created the first artificial intelligence platform capable of automating restaurant procurement. With our solution, you order just what you need at the right time. This will reduce waste due to unnecessary storage and out-of-date products. 

In order to ensure an ultra-precise management of raw materials, we also advise our our customers the FIFO First In First Out method, which consists of methodically arranging their refrigerators. The foodstuffs are classified in such a way that the shortest shelf life is used first in the kitchen.

2. Respect the portions of the recipe cards

Replicating a concept is what makes chain restaurants successful, the dishes are calibrated and consistent. However, if there is no means of control, the operational reality can be quite different from the objectives set.

"We have a food cost to respect, so we have to rationalize all our dishes, have the same dosage between our restaurant in the 13th and the one in the 10th. Inpulse allows us to really keep an eye on this point. I'm especially looking at the meat. As Kamel Zaoui, founder of Luks Kebab, reminds us, one of the main causes of consumption discrepancies is the failure to follow recipes.

There is often a discrepancy between the portion sizes in established recipes and the reality of what will be used in the kitchen. To compensate for this, restaurant chains are setting up systems to dose the most expensive ingredients at the time of assembly or cooking. Each concept will have to find the right tool to dose without slowing down the rhythm in the kitchen. Some chains use utensils such as ladles or plastic measuring devices, while others plan to have the packaging of meat, for example, done by the supplier or the central kitchen to ensure that the perfect portion is weighed beforehand.

3. Conduct regular inventories to better identify gaps

It is only by having a clear vision of your stocks that you will be able to limit discrepancies, for that it is necessary to make regular inventories. We recommend to our customers to set up :

  • A weekly inventory for strategic and high turnover products.
  • A monthly inventory for all products.

It is therefore thanks to the regularity of the information provided by the field that consumption discrepancies can be identified. This has other beneficial effects. 

On the one hand, to make the teams aware of the consumption of raw materials and the importance of inventory management.

And on the other hand, to reduce the rate of cargo theft. Also called leakage, it is one of the main causes of discrepancies. Few official statistics exist on the subject, and it seems difficult to avoid it when you have a very high turnover rate. Establishments that are victims of theft are those that have little or no control over their inventory.

Implementing an inventory management tool has the effect of deterring teams, as inventories are more regular and unusual stock entries/exits are quickly spotted.

4. Follow a procedure for receiving goods

Even if your supplier is willing, there are many reasons why the quantities delivered and the prices charged do not correspond to the purchase order: change of meat piece, unavailable product, momentary shortage, substitute product in case of shortage, unforeseen price change, etc.

Products are missing? You will be obliged to make a last minute repair order at higher prices. 

Others are defective? If a bad item has been delivered to you, and no control is done at reception, you increase your losses without realizing it, with products that you cannot use. Finally, credit note requests are quickly lost on paper, it is a sum that should not be neglected because it can be consequent on the year.

Inpulse offers a fully digitalized receiver control module for : 

  • Check that the quantity delivered corresponds to the one ordered
  • Generate credit requests automatically to its suppliers
  • Reconcile supplier invoices with quantities delivered

You will drastically limit errors and save precious time in the management of credit requests. 

5. Simplify the updating of the mercurials

As a reminder, the mercurials make it possible to define the prices and availability of products that are likely to change regularly and impact the consumption gap.

  • ‍Theprice

Failure to update these prices can lead to a widening of the gap between theoretical and actual material costs because commodity values are based on outdated data. If commodity prices are not updated at the same rate as market fluctuations, the consumption gap will increase in value. 

  • ‍Product availability

If the availability of the products is incorrectly indicated when placing the order, the manager places the order and does not receive the desired products. At the last moment, he is obliged to place an emergency order at non-preferential rates. These malfunctions increase the cost of the raw materials consumed, and therefore the consumption gap in value.

With a purchasing data centralization tool like Inpulseupdates and information transmission are simplified.

6. Report known losses

All consumption must be recorded for accurate inventory tracking. At Inpulsethere are 4 categories of loss: breakage, expiry, staff meals and promotional offers that can be fed back into the tool to accurately monitor stock variations.

Often forgotten, staff meals must be declared in order to ascertain whether these losses are consistent with the policy implemented by the network, e.g.: 1 dish per service per employee.

Use a complete restaurant tracking software like Inpulse allows you to report on the status of raw and finished product losses. You'll be able to see any unusual losses and get a true picture of inventory levels.

To go further

More than 1,200 restaurants and retail outlets use Inpulse on a daily basis