Last Updated On October 11, 2018 / Written By Victoria Brunette

Why Inventory Management is Essential to Your Restaurant

Let’s delve deep into the five most significant aspects that proper, efficient inventory management can help your restaurant continue to grow, and how failure to execute this process could be holding your restaurant back.

Inventory Management is More than a "Chore"

Think about some of the most basic routines carried out day-to-day in your restaurant. There’sfoodpreparation,dishwashing, and cleaning up of the dining area and back of house. Even in cleaning the dining room alone, there are several sub-tasks that must be taken care of, such as, vacuuming, washing tables, cleaning windows, and basic, daily maintenance; all of which help to provide the most welcoming and comfortable environment possible for your guests.

There are plenty of other routine tasks that are essential to the proper functionality of your restaurant. Chief among these is inventory management, which includes the inventory count and ordering of food and supplies. The worst thing that can ever happen to a restaurant, short of a major health code violation, is running out of food during the middle of a busy night. Whether it’s as niche as running out of some strange foreign fruit, or as essential as running out of milk or eggs, this can stop the progress of a restaurant dead in its tracks. What’s more, it can leave a lasting impression on customers, forcing them into an opinion that may not necessarily reflect the truth of your restaurant, strictly because of a single bad experience.

We will take a look at five ways in which proper inventory management is vital to the success of your restaurant. We believe the following practices to be the most significant and influential ways effective inventory management can positively impact your business. We’re going to tie in things like the influence an inventory count can have on ordering and stocking as well, to give you a taste of how many key areas of your restaurant can be affected by the seemingly menial task of inventory management.

Poor Inventory Management = Poor Customer Experience

The key thing to note is that everything happening within your restaurant, on every level, all comes back to having an impact on the experience of your customers. Whether we look at the neatness of employee outfits or the quality control of the food, it all impacts one of the five senses and leaves a lasting impression; inventory management is no different. With potentially incorrect inventory counts, you run the risk of being unable to guarantee the very service you advertise to your customers in the first place, food service. We’ll touch on ordering a bit more in the next section, but remember that each item on your menu acts as a promise to your customers in which you can provide them that dish. Being unable to do so is, in essence, breaking that promise, and customers will inevitably take issue with it.

Proper Inventory Management Forces You to Order More Effectively

Successful inventory management is one of the vital aspects of restaurant maintenance that, in one way or another, impacts every other area of the restaurant. This is most apparent when it comes time to order food or supplies and restock your business. Inventory count affords you the opportunity to look at which food items you are consistently running out of, or very low on, and can help you to decide whether or not you should order extra of that item in future orders, whether other items are going unused as a result, and many other key facets of your restaurant’s success. Pay close attention to inventory counts, because they may just prove to be the element that guarantees your restaurant’s longevity.

Inventory Management Provides Insight into Your Business

As we alluded to in the previous point, proper inventory management can provide several key insights into your business. This becomes most obvious when we look at determining the success or failure of menu items. For example, if you are consistently running out of certain ingredients, and these ingredients are only found in a handful of menu items, then it might signify a certain preference among the majority of your customers. Future changes to the menu might do well to reflect the customer patterns made apparent through effective inventory management. Of course, this is only one example but it is also one of the most profoundly impactful insights when considered.

Inventory Management Can Provide Insights into Employee Performance

Inventory management can provide your managers with important insights into employee performance.This might sound a bit cynical, although, from a strictly business perspective this aspect does make a lot of sense. If you have an employee carrying out inventory counts week after week, and the ordering is still consistently off, then it might signal that the employee is not well suited for this particular task, or for your restaurant as a whole. Of course, it would be reasonable to assume the former is true until they prove the latter, since for some people the banality of an inventory count can certainly become an impediment. But don’t worry, there is modern inventory management software available to help curb some of the dullness of this task, including Hubworks’ Zip Inventory.

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Proper Inventory Management Can Help Maintain Profits

This last point is a big one. When executed properly, inventory management can help better manage your operations in a way that a steady profit, rather than a loss, is maintained by your restaurant. How can this be? When we talked about the impact of efficient ordering as a result of inventory counts in earlier points, we looked at it from the perspective of customer service. While this is still a vital component, we can also look at the way ordering impacts your business’ financial success too. When you consistently order food that nobody is eating, you’re essentially letting money sit in the freezer and wind up in the trash. Something plenty of people know but seem not to understand, is that you should only order the food supplies that will be consumed in a given time frame. Ordering in excess can result in not ordering enough in the future or ordering things that will go uneaten, only to damage your financial outlook. It’s easy, if nobody eats it, and you spent money on it, then it is a loss. An effective and efficient inventory management process can help to manage your loss and curb these risks for your restaurant.

We hope that this article has given you a sense of just how important proper, effective inventory management can be to the success of your restaurant, both commercially and financially. If you’re interested in trying out inventory and ordering software, featuring an efficient, mobile shelf to sheet design, sign up for a free trial with Zip Inventory from Hubworks.