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Wednesday, March 15, 2006

Yield Analysis

If you expect to hit a consistent food cost percentage, make sure you actually receive everything you've paid for on all the invoices.

Once the goods have been safely stored in freezers, coolers and dry storerooms, the next biggest source of variance is production. Over production is a huge issue in food service since the value of produced food declines rapidly. Finished products should be served as intended whenever possible. You can't ask someone to pay a premium price for a twice roasted piece of meat.

All production starts in the prep phase and the most expensive mistakes are generally made with protein items. Perhaps you need to slice a peeled tenderloin into 8 ounce steaks. Maybe you are a gambler and have decided to butcher a veal rack. Generally, every operation has at least one major prep item which significantly impacts food cost.

If you hit the shore, most good operators can tell you how much it costs to make a crab cake (based on the most recent delivery). The deli managers can see the cost of a sandwich change based on examining the exterior fat on the briskets. Even french fries have a tendency to yield below average portions.

The one item I find lacking in the prep and butchering operation is a sense of standard yield. People seem to be aware of major discrepancies. If the short loin yielded 75% instead of 81%, there is plenty of discussion but not many know their cost of goods sold will be 8% higher.

A lack of standard yields turns many problems into anecdotal discussions in the weekly management meetings.

Try to develop standards and track actual results against these figures. You'll start to see why a particular vendor always has a lower price per pound. You will develop an awareness of delivery mistakes which allow you to request and receive credits.

Pay the right price for what you actually receive and make sure you get the precise standard expected.

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