Chapter 8
Restaurant Operations
After Reading and Studying This
Chapter, You Should Be Able to:
Apply the forecasting technique used in the
chapter to measure expected volume of
business
Name and describe the various types of
services
Explain the important aspects of food
production
Describe the key points in purchasing,
receiving, storing and issuing
After Reading and Studying This
Chapter, You Should Be Able to:
Explain the difference between controllable
expenses and fixed costs
Explain the components of an income statement
and operating ratios
Describe the important aspects of a control
system for a restaurant operation
Outline the functional areas and tasks of a
foodservice/restaurant manager
Front of the House
“Curbside Appeal”
Organizational chart
– Dining Room Manager
– Hostess
– Servers
– Bussers
Restaurant Forecasting
Budget projections
Guest counts or covers
– Meal periods
– Day of week
– Special holidays
Average guest check
Food and Beverage Occupancy
Statistics
Occupancy Statistics
Cover = A guest
Number of Turns =
Number of Covers
Number of Seats

Average Restaurant
Check
Average check =
Food and Beverage Sales
Number of Covers
Service
Guests want less formal, yet professional
Training is necessary
Servers are salespeople
Suggestive selling
Types of Restaurant
Service
French Service
Russian Service
American Service
Balancing the FOH with the BOH
Purchasing
Receiving
Storing and issuing
Food production
Stewarding
Budgeting
Accounting and control
Food Production
Based on expected
volume of business
Prep work done prior to
service times
Kitchen layout
– Cooking line
Teamwork
Kitchen/Food Production
Staffing and scheduling
Training and development
Management involvement
Employee recognition
Production Procedures
Production sheets
– Count the product on
hand (par levels)
– Determine production
level
– Determine actual sales
Key to consistency
and quality of food
Purchasing
Use of standards (product specs)
System of control for theft and loss
Par stock and reorder points
Who will do the purchasing?
Who will handle receiving and storage?
Receiving, Storing and Issuing
Time and date delivery is to be made
Point of control
Authorized requisitions
FIFO
Food Cost Percentage
Opening inventory
Purchases are added to
opening inventory
Subtract returns,
spoilage and
complimentary meals
Subtract closing
inventory
Final number = Cost of
goods sold
Food Cost Percentage
Food Cost
Percentage (cont.)
Food Cost / Food Sales
X 100 =
Food Cost %
Typical Cost Percentages
Cost Percentages
– Labor costs
– Food costs
– Beverage costs
20 to 24%
28 to 32%
18 to 24%
Lease and Controllable
Expenses
Expenses
– Lease cost should be 5
to 8% of sales
– Typically also pay for
insurance, utilities and
commercial fees
– Controllable expenses
are also variable
expenses
Controls
Loss of $20 billion a year due to theft and
cash mishandling
One out of every 3 employees will steal
35% of restaurants fail due to theft
75% of missing inventory is from theft
73% of all job applications are falsified
Use of POS can solve some problems
Trends
More flavorful food
Increased takeout
meals and home meal
replacement
Food safety and
sanitation
Guests becoming
more sophisticated
Trends
More food court
restaurants
Steakhouses are
again popular
Segments are
splitting into tiers
QSRs in
convenience stores
Difficulty in finding
good employees