Managing Your Space: Product Management Basics
Ordering, stocking, rotating, and inventory.. oh my!
We've already covered one of the easiest and most essential ways to ensure you are on top of your domain in the restaurant - the daily Space Walk. Today, some basics of product management to your growing list of skills: ordering, stocking, rotating, and inventory. Aka the fun stuff.
🌿 Bonus: There will be a free par sheet and inventory sheet included at the end.
Product Management Basics
All kidding aside, you might consider these duties the nuts and bolts of operating an efficient machine. If you don’t order well, your restaurant will run out of essential items and the whole machine might seize up. Stocking properly ensures that your team knows where everything is and they can keep the machine running efficiently. Rotating product correctly reduces waste that will ultimately limit the opportunities your team has, and inventory is crucial for proper financial management of the business.
📝 A quick note: all restaurants have their own systems and hierarchy of who does what. Your restaurant may have a fine tuned system already, or you might work for a mom & pop that has zero systems in place and you’d like to fix that. The aim here is to cover the general basics that apply to most restaurants, but it is up to you to determine what applies to you and your restaurant, and how it applies.
Let’s dive in, shall we?
Ordering
I am sure that you have worked a shift or two where it seemed like everything was 86’d. It is the absolute worst: the disappointment on the guest's face, the panic in the server’s eyes, the seething fury in the line cook’s soul. Shortages happen, but consistent running out of essential items that keep your restaurant operating smoothly is a quick way to lose not only customers, but also the faith of the team.
As a manager, you are ultimately responsible for ensuring that your area of the restaurant has what it needs to serve its team and guests efficiently. That means ordering product and supplies before they are needed. It means noticing the things that are missing, even if they aren’t on a list.
Here are some key points to keep in mind:
Use a Par Sheet: Par sheets help you keep track of the minimum amount of each item you need on hand. This is crucial for avoiding shortages and maintaining consistency. Pars should be adjusted according to the ebb and flow of your particular restaurant, so pay attention to seasonality as well as special events in your area.
🌿 Free template available at the end of this newsletter.
Beyond the Basics: Pay attention to items that fall outside the regular daily list, such as office supplies, deep cleaning supplies, etc. These are just as important to the smooth operation of our restaurant.
Team Input: Empower your team to help keep track of things. Consider putting up a dry erase board where your team can write down things that they need or notice throughout their shift so that they aren’t missed or forgotten.
Audit Regularly: Occasionally audit your lists to update them as business changes and develops. This proactive approach prevents last-minute scrambles and 86s.
New Menu Items: Get ahead of new menu item releases by preparing your orders in advance. Anticipate what you’ll need and ensure you have the necessary supplies on hand to meet demand.
Seasonality: Adjust your orders based on the season. Some items may be more or less in demand depending on the time of year.
Vendor Relationships: Develop strong relationships with your suppliers. Good communication can help you get better deals and ensure timely deliveries.
Forecasting: Use historical data to predict future needs, especially for peak times like holidays or special events.
Bulk Buying: Consider bulk buying for non-perishable items to save costs, but ensure you have adequate storage space and that your boss is on board.
Emergency Orders: Have a system in place for emergency orders. Know which suppliers can provide quick turnarounds.
Do Not Over-Order: Imagine an old-fashioned scale, with the bowls on either side. You need to keep that scale balanced. Too much product, and you’ve tipped the scale towards financial ruin. Too little product, and you will lose staff and guests. Just enough, and you’ll be operating a well-balanced restaurant.
Stocking
Imagine that you need a specific black shirt to wear for a work event. You have clothes piled all over your room, laundry still in the dryer, and more in your closet. You start searching where you think it might be, but you don’t find it. You go through the dryer, the piles in your floor, and then open your closet. The closet floor is filled with shirts, but you need this one specifically. You start to throw out everything, looking for this one shirt. After 15 frustrating minutes, you finally find it in the bottom of the dirty hamper. You now need to leave in 5 minutes, so you are furiously trying to spot clean your shirt before throwing it on and rushing out the door.
Now, imagine that you need that black shirt and you walk into your room. You open your closet, and you pull it off the hanger where it always is. It takes 30 seconds. You put it on, check the mirror, and head out the door a little early.
This is not a commentary on your lifestyle. Plenty of people have piles of clothes in their rooms, and that’s fine. It’s your room. However, there’s no denying which one is more efficient when it’s time to get ready.
How you stock and organize your area of the restaurant could make all the difference in how efficient your team is able to operate. Are they constantly searching for items in different places, putting them in the weeds when they can’t find it? Or do they know exactly where to go for what they need?
Here’s what you need to know to move towards the second scenario:
Organization: Ensure that items are organized in a logical manner, with similar products grouped together. This makes it easier to find what you need quickly and efficiently.
Define your storage areas: Label shelves and storage areas clearly. This helps in maintaining order and ensures that everyone knows where to find and return items.
Labelling: Label prepped products according to your restaurant’s specifications as well as your health department’s regulations. Some restaurants use tape, others have specific stickers. Every prepped product should have a clear name and date, at the bare minimum.
Store Food Properly: In restaurants, we are required by food safety laws to store food in a proper hierarchy. See the chart below. Your restaurant should have something like this posted in a few places. Also, remember that chemicals should be kept separate. Nothing dangerous or toxic or raw can be stored over anything that will serve food.
Cold Storage Note: If your freezers are not maintaining consistent temperatures, notify your supervisor or a refrigeration maintenance company immediately. Refrigerators should be maintained at or below 40°F (4°C). Freezers ideally should be kept at 0°F (-18°C).
Stock Rotation Training: Regularly train staff on proper stocking techniques and the importance of rotation to prevent spoilage (see more below).
Daily Checks: Implement daily checks to ensure stock is organized and properly stored. This is where your Space Walk comes in.
Cleanliness: Ensure storage areas are kept clean and free from pests. Regularly schedule deep cleans.
Ask Your Team: They are the ones that are constantly reaching for items, cursing under their breath when they can’t find something. Ask them if they have any suggestions for where things should go.
🌿 Word to the wise: communicate before re-organizing everything. Even if a restaurant’s organization is subpar or non-existent, no one wants to walk into their space and see that everything has been re-arranged overnight. Collaborate with others, incorporate their suggestions, and make sure you get permission if you need it.
Rotating
Rotating is an extension of proper stocking. Effective product rotation is key to minimizing waste and maintaining quality. Minimizing waste means a stronger bottomline, which should translate to more opportunities. Maintaining quality means a better restaurant, and a better restaurant is usually a busier one.
The FIFO Method
In restaurants, we live and die by FIFO. FIFO means “First In, First Out.” Simple enough, right? FIFO simply means that older stock is used before newer stock. This applies to cold product, prepped product, dry goods, and even disposable products.
Date Labels: Use date labels on all perishable items. Clearly mark the date of receipt and the expiration date to keep track of freshness.
Regular Checks: Perform regular checks of your stock to identify items that need to be used soon. Move these items to the front of the shelves so they are used first.
Staff Training: Train your team on the importance of rotation and how to do it correctly. Make it a part of your daily routine to check and rotate stock.
Visual Aids: Use visual aids and signs to remind staff of the FIFO method.
Regular Audits: Conduct regular audits of stock to ensure rotation practices are being followed.
Spot Checks: Perform spot checks during different shifts to ensure consistency.
Special Attention Items: Identify high-risk items (like dairy or seafood) and pay extra attention to their rotation.
Assign FIFO Champions: Engage with staff and assign them small sections that they are in charge of overseeing.
Inventory
Inventory is possibly one of the least favorite activities for most restaurant managers, with the rare exception of the person who really loves counting these things. If you have this person on your team, cherish them. If this is you, bless you.
Inventory management is crucial for the financial health and smooth operation of your restaurant. It directly impacts your Cost of Goods Sold (COGS) and Profit & Loss (P&L) statements, helping you avoid shortages, reduce waste, and maintain quality control. By keeping track of what you have on hand, you can optimize ordering, ensure efficient operations, and hold your team accountable. Embracing effective inventory management will enhance your restaurant's efficiency, profitability, and overall success.
In other words, being enthusiastic about inventory will set you apart and make you a superstar.
Here are a few key points:
Timing: Inventory should be done at least monthly. Some restaurants will do it weekly. Still other restaurants will count inventory for high value products weekly or even daily (bar products, meat, etc), while counting lower value items monthly (disposables, cleaning supplies). Find out what your restaurant’s standard is, while observing if it needs to be fine tuned.
Inventory Sheets: If you don’t use inventory software, then consider making an inventory spreadsheet or checklist to make it easier. The most efficient way to organize inventory is by storage area. There’s a free template to get you started below if you don’t already have one.
Buddy System: It’s always best to count inventory with two people, with one person counting and the other documenting. This makes it more efficient, while also ensuring accountability for accurate counts and potential dishonesty.
Shake It Up: Rotate team members that count inventory to reduce fatigue, maintain accuracy, and reduce risk of false counts (which may cover up theft). It may not be a bad idea to assign buddies that work in different areas of the restaurant to cross-train and keep it honest.
Accuracy: Double-check your counts and ensure everything is recorded correctly. This accuracy is crucial for maintaining inventory integrity and financial accountability.
Inventory Variance: Track inventory variance (differences between recorded and actual stock) to identify patterns and address issues.
Cost Analysis: Regularly analyze inventory costs to identify opportunities for cost-saving without compromising quality.
🌿 Word to the wise: beware of team members or managers that insist on counting certain areas every time, especially if they are high value products. This could be a red flag that they might be fudging the numbers to cover up product that is walking out the door. Never accuse outright without validation. Instead, quietly do your own inventory and bring discrepancies to the attention of your supervisor or the owner. As always, stick to the facts and not your suspicions or opinions.
Recap
While these nuts and bolts of operating your space may not be the most fun or interesting for most, they are absolutely crucial to keeping things operating smoothly. As a leader, your job is ultimately to keep the machine running efficiently and to support your team. This means making sure they have what they need when they need it, keeping storage areas organized, and reducing waste.
Now, give yourself a grade. Where do you stand today? How can you move from where you are to where you want to be?
A = Exemplary Product Management: You consistently ensure your restaurant is well-stocked, items are rotated properly, and inventory is accurate, resulting in smooth operations and financial efficiency.
B = Strong Product Management: You manage these tasks well most of the time, with only occasional lapses.
C = OK Product Management: Your management is inconsistent, with some areas well-handled and others needing improvement.
D = Mediocre Product Management: You need frequent reminders and support to keep up with ordering, stocking, rotating, and inventory tasks.
F = Poor Product Management: You struggle to manage these tasks effectively, often leading to shortages and waste.
Free Templates
Click the links below for free templates for par ordering and inventory counting.
These are Google Sheets. In order to use follow these instructions:
If you have a Google Account: Go to File > Make a Copy. Then move that file into “My Drive” as in.. your own google account. Otherwise all paid subscribers to OOTW will be able to use your file.
If you do not have a Google Account: Go to File > Download As > Excel
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