COST CONTROLS Introduction Week 1 WELCOME BACK ! • Welcome back to school! • You are now in 2nd year ! • Courses are going to be somewhat more challenging STUDENTS' SUCCESS AND COURSE EXPECTATIONS • Purchase e-textbook or hard copy textbook • Attendance is mandatory!!! • Read assigned chapters • Review PowerPoints • Do the assigned Homework - weekly • Ask for help when needed! Quizzes: There will be four in-class quizzes, which will be written in the weekly lecture. Quizzes count for 20% of your final grade. All Cameras must be on. Homework Assignments: There are homework assignments in this course. Homework counts for 10% of your final grade. Cheating and Plagiarism: All forms of cheating including plagiarism will be treated as a serious offence, which could lead to an automatic Failure from the course and a possible expulsion from the program. See the department's policy. Moodle – On line learning: You will have access to an on-line program (Moodle) with practice assignments for all chapters. Moodle Content is very useful to reinforce your learning. Final Exams: All final examinations are written in the last week of school, Instructors are not allowed to let anyone write this exam at any time other than the scheduled time. If you think you need to reschedule this exam you must make these arrangements with the Department Head. Agenda • • • • Welcome Discussion Questions 1 & 2 Review Checklist Questions Objectives o Describe the role of math and financial information in making management decisions o Identify revenue and expenses as the resources that managers control to generate profit o List the primary types of loss that occur in a foodservice operation COURSE STRUCTURE o Describe the flow of food in a foodservice operation and pinpoint where cost control points are most critical o Describe the importance of learning cost control theory and mathematical calculations in an industry that often realizes on computer systems to collect data and perform calculations Checklist Due by May 9th, 2023 @ midnight Read Chapter 1 pg. 1-8 Review PP Chapter 1 Submit Online Comprehension Questions 1, 2, 3, 4, 5 & 6 Complete Mini Quiz WHAT IS COST CONTROLS? Add, Subtract, Divide and Multiplying • Who uses Cost Controls? Restaurants, Bars, Hotel Facilities, Catering, Special Events • What are we controlling? Food, Beverage & Labour $$$ Profit = Revenue – Expenses Revenue = Sales of Food & Beverage etc. IMPORTANT TO KNOW Expenses are Controllable VARIABLE or may be FIXED FIXED expenses costs are Mortgage (Rent, Lease) and must be paid regardless if business is busy or slow FOOD, BEVERAGE & LABOUR These 3 areas are VARIABLE COSTS Food & Beverage Cost of Sales $ and % Refers to the COST of making/serving an item for a guest. Example: burger or beer Labour Labour Cost $ and % Payroll is what we for staff scheduled according with the business volume. EXAMPLE Burger Meal Cost Burger Meal Selling Price $ 3.58 $ 8.95 What can we learn? Contribution Margin $8.95 – $3.58 = $5.37 CM = Selling Price – Meal Cost $3.58 / $8.95 = 40.00% Food Cost % FC = Meal Cost / Selling Price FC is always a precent % • Buy the (e)book FOR THIS WEEK! • Read Chapter 1 • Log in to MOODLE and familiarize yourself! GET READY • We are having a practice round! • 2 minutes to log on
