In the early 2000s, nothing was more enjoyable than a family lunch or dinner with delicious food in the right ambiance on a weekend. A decade later, consumers began calling their favorite joints and began ordering food. Slowly smaller delivery and inventory management software solutions slowly began taking shape to address the growing challenges of food delivery during rush hours. Another decade later, food delivery apps make an entry. An increasing number of restaurants started to tie up with food delivery apps such as Grubhub, Postmates, and Uber Eats.
Cut to today. Technology and the restaurant industry have joined hands. To increase customer value, businesses have to employ smarter marketing tools and use personalization to drive increased order value, also minimizing 3rd party fees (read delivery and apps). In short, customer delight is that which is set to drive loyalty to a brand and inflate revenues for the industry.
As per a report by Forbes – “Restaurant Industry Projected To hit $1.2 Trillion in Sales By 2030…”The author goes on to discuss how the restaurant industry has placed itself on the brink of battling convenience-driven technologies, challenges of labor, sustainable food practices, a swiftly changing consumer set (as highlighted above) amid intensifying competition. “… All of these factors (and more) have affected the $833 billion restaurants in the past couple of years, unlike any other time in the industry’s history,”…and the article proceeds to discuss on those lines.
Challenges of the restaurant industry –the role played by inventory management.
Managing a restaurant offers numerous challenges with something ongoing on a day to day that demands attention. The first step is, therefore, to have as many policies and procedures in place as possible. Let us also remember that to survive slim margins, controlling costs is the first step. As food and labor are typically the most substantial expenses, it is therefore imperative to have a restaurant inventory management software and policy for your business. The inventory covers food, beverages, small wares, and other cleaning supplies and hence is the most daunting yet crucial pin that rotates the wheel of your business.
The main objective of taking inventory is to not only measure the amount of usage by item used by the restaurant over time but also to compare the same against the sales. Now this will help investigate the gap between the production value and sales. A restaurant inventory management system will help in placing future orders and help minimize waste and control costs.
6 benefits of having a restaurant inventory management solution-
1. The obvious- simplified inventory management
With supply and demand changing throughout the year, and the stock levels continuously fluctuating to keep up, the software helps to avoid the risk of human error by automating accounting of inventory. Staff will need to enter order information in the relevant fields for all related computations to take place from there.
2. Avoid overselling.
By synchronizing orders received and inventory available on hand and in marketplaces, online businesses can assess the amount of supply that needs to be planned across channels. Stock levels can be adjusted every time there is a sale.
3. Increased cost-savings and avoiding stock-outs
Streamlining inventory management processes will eliminate the inventory costs associated with human error. It can improve the chances of cutting down the supplier lead time via better supply management techniques. Excess and the obsolete stock get cut down, implying further cost savings. Buffer or safety stock can also be accommodated accordingly. For having too little stock can lead to a stock-out, and having excess stock can take up valuable warehouse space and incur unnecessary additional charges. Either way, this means unhappy customers and potential loss of sales.
4. Improved business negotiations
By using inventory and restaurant management software with exact batch tracking capabilities, product traceability is in control, and this actively aids in positive and assured negotiations with the supplier. Additionally, it is easier to obtain clarity and understanding of suppliers who benefit from the business, and the areas require improvements.
5. Dealing with having to call a product off the shelf
The biggest challenge which restaurant owners face is to bring down an item that is not so “hot” on the menu. The problem that follows is the time and effort it can take to track down the affected products /stock without any impact on the rest. Without complete product traceability and the necessary batches attempting to resolve the problem with a supplier can be a significant challenge.
6. The ability to make more profitable and informed business decisions
Inventory management software can provide invaluable sales data, allowing for more proof driven decision making. For example, being adequately informed on supply and demand, helps forecast sales trends, lending the business a much needed competitive edge. Reporting features and inventory metrics equip restaurant owners with all the right tools needed to make strategic decisions. The ability to work out food and beverage requirements, inventory turnover rate, stock in the warehouse, identifying perishables faster, etc. helps in cutting down costs dramatically.
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