Guide to Digital Restaurant Inventory Management
Inventory management for restaurant managers can be a challenge.
Especially if you’re still using spreadsheets or pen & paper to keep track of your inventory, there are many challenges of scaling inventory with pen and paper or spreadsheets.
It’s easy to lose track of stock, due to inaccurate data entry.
Inventory turnover (and cost) increase when there are inefficiencies in the inventory count.
Issues aren’t easily flagged in a simple spreadsheet.
Staff spend time and resources managing physical inventory control, instead of serving customers.
Inventory management software can cut time spent keeping track of raw materials, stock and other items of inventory. Whilst improving accuracy.
Keep on top of cash flow by flagging any inventory issues (like overstocks or short-dated items). There's no need for managers to manually trawl through lines on a spreadsheet.
The COVID-19 pandemic has accelerated digital adoption for restaurants
With lockdowns and remote work, the COVID-19 crisis has changed consumer behaviour when it comes to restaurant dining.
Increased takeout and delivery service. Online ordering systems. QR-code menus. Contactless payments. There’s no denying that the COVID-19 pandemic has greatly increased the use of digital tools to improve the customer experience across the restaurant industry.
Digital adoption doesn’t stop with the customer-facing parts of a business though. From inventory management to purchasing to recruitment, restaurants and bars are going digital. Digital tools can keep food costs down, control inventory in real-time, optimize stock ordering, and automate reporting.
Best practices for restaurant inventory management
What is restaurant inventory management?
Managing inventory is all the processes involved in ordering, storing, using, and selling your inventory.
For a restaurant or food and beverage service, this might include:
- Tracking and ordering the raw materials that go into each dish on the menu
- Tracing the use of each ingredient in each recipe or dish
- Managing much shorter use-by dates than, for example, retail stores
- Taking wastage into account
- Managing bar and beverage inventory.
Benefits of restaurant inventory management software
An inventory management system should be part of your restaurant management software stack.
With accurate inventory tracking, you have up-to-the-moment knowledge of inventory levels. Access data wherever and whenever you need it. Whether that’s in the restaurant, at head office or out-and-about on a mobile device.
Accurately tracking your restaurant’s inventory can make it easier to spot patterns as they emerge. You can track waste - and pinpoint potential theft - in your restaurant.
As well as controlling your inventory, restaurant inventory management software can improve profit margins. More accurate food costing allows you to budget the raw ingredients that go into each menu item. You can easily get an overview of which dishes are most and least profitable.
Ensure you never run out of an ingredient by following best practices for restaurant inventory management. Make sure you know par levels and get reminders when inventory is low and it's time to order more.
Spreadsheets aren't built for reporting. Dedicated inventory management software makes it fast and easy to run reports. Make the most of your data with automated reporting. Understand your real-time inventory levels, predicted vs actual food costs, and wastage patterns. Get an overview of historical sales and ordering data to facilitate forecasting and make more informed inventory decisions.
The difference between restaurant inventory software and pos software
A POS (Point of Sale) system manages and tracks your restaurant’s sales transactions.
POS is an important part of the restaurant inventory management puzzle. It gives you a way to track inventory sold, based on customer orders, and to forecast demand for menu items.
A POS system though, can’t give you the full story of your inventory management. Restaurants receive most of their inventory as raw ingredients, so a smart inventory management system should be able to calculate menu item cost, based on a recipe.
POS also isn’t the only place that inventory leaves the kitchen. You also need to track wastage due to accidents, short-dated items or even theft, to get a truly accurate overview of inventory in your business.
MarketMan integrates with most POS systems. You can pass accurate data directly from MarketMan into your POS (or from your POS into MarketMan) in real-time.
How to carefully utilize restaurant inventory to eliminate losses
How efficient is your restaurant or bar? Reducing waste is one of the fastest ways to improve restaurant efficiency, cut unnecessary inventory costs and increase the bottom line in a restaurant business.
Inventory management software can help you to reduce restaurant waste.
Restaurant owners can utilize an inventory system to reduce food cost by eliminating losses and waste. With accurate, real-time reporting and alerts, you always know exactly where your inventory is.
Ensure staff take accurate inventory at the beginning and end of every shift, to get a good overview of sitting inventory. An inventory management system allows you to automate more of the process. This, in turn, can improve the speed, efficiency, and accuracy of your inventory control.
You can also reduce waste by tracking dates in your inventory management system. Easily flag when ingredients are close to spoiling, and make fast decisions on promotions to reduce waste.
Hand-in-hand with this is using FIFO (First-in, First-out). FIFO ensures the oldest stock gets used before any new stock. This way, you cut the likelihood of inventory spoiling.
How MarketMan’s digital inventory works
MarketMan’s cloud-based restaurant inventory management software helps restaurant managers to keep track of stock across the entire operation.
Easily set up your business inventory counts, supply chain, menu items, ingredients and recipes so you have a full digital inventory of food in the restaurant.
Then, use MarketMan’s software to receive inventory and invoices. You can even set up automated alerts, so you get a reminder when you’re running low on a particular ingredient.
Finally, keep track of inventory leaving the kitchen. You can automatically track menu items sold (and the ingredients they contain) with a POS integration. Augment POS data with manual inventory counting, to manage waste.
Automated reports and alerts can flag potential issues. So you can catch them before they become a real problem.
Why go digital to manage restaurant inventory?
A digital software system automates part of the restaurant management process. Digital inventory management makes stock control faster, more efficient and more accurate.
Remove the manual admin (and decrease the risk of error) associated with managing your inventory on spreadsheets or paper.
Inventory management software can help reduce restaurant waste, streamline your ordering and supply chain, and give you access to data, so you always know how efficient your restaurant or bar is.
Finding the right inventory management system for your restaurant is important. Get started today with a free trial of MarketMan.