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How to Reduce Bakery Waste
 

How to Reduce Bakery Waste

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    How to Reduce Bakery Waste How to Reduce Bakery Waste Document Transcript

    • Memo Date: To: From: Subject: May 6, 2013 Connie Inukai, Professor of Technical Writing University of Maryland Eastern Shore at the Universities at Shady Grove Kyle Bissett Sharon Moore Yongkyoung Park Sakura Shu Synergy Restaurant Consulting 9630 Gudelsky Drive Rockville, MD 20850 Proposal for How Cost Control Can Reduce Waste in Bakery Operations Attached is the proposal from our restaurant consulting company, “How Cost Control Can Reduce Waste in Bakery Operations.” Kyle, Sharon, Yong and I have formed Synergy Restaurant Consulting, which focuses on providing technical and efficient ideas to food service operations with the goal of helping those operations to increase their bottom line performances. We researched different methods of reducing waste in bakery operations. In the attached proposal, you will find how staff training, menu design, industry technologies, and managerial systematic approach can increase efficiency in bakery operations and help reduce waste production. On the basis of our research, we suggest that a combination of these methods will be the most resourceful way to increase operations’ performances. We greatly appreciate the opportunity to present you with our research and we forward from your feedback and hope for the chance to work with you in the future. If you have any questions, please contact us anytime at 123-456-7890. Again, thank you very much for the opportunity and we hope to hear from you soon.
    • How Cost Control Can Reduce Waste in Bakery Operations Prepared by Synergy Restaurant Consulting 9630 Gudelsky Drive Rockville, MD 20850 123-456-7890 www.synergyconsulting.com Kyle Bissett Sharon Moore Yong Park Sakura Shu 2
    • How Cost Control Can Reduce Waste in Bakery Operations Submitted on May 7th, 2013 Kyle Bissett Sharon Moore Yong Park Sakura Shu 3
    • ABSTRACT “How Cost Control Can Reduce Waste in Bakery Operations” Prepared by: Kyle Bissett Sharon Moore Yong Park Sakura Shu In April 2013, Connie Inukai, English Professor at the University of Maryland Eastern Shore at the Universities at Shady Grove, asked four students in her technical writing class to do research on how bakery operations can cut cost and reduce waste through cost control. To perform this research, the students looked into several areas in the baking industry that management could exercise control, keep waste to a minimum, and utilize resources as efficiently as possible. These areas included training, the systematic approach to cost control, menu design, and tools and utensils. The students have discovered that cost control involves much more than cutting cost and reducing waste. It is an on-going strategic plan that involves the vision of an operation’s success, monthly and annual financial goals, and daily evaluation of productivity. It is also one of the most important elements necessary for an operation to compete in the marketplace effectively. The students recommend that every bakery operation, regardless of its size or method of service, should have a cost control system in place. Every decision made is related to an operation’s financial success. Therefore, owners and managers need to regularly access and review information about the expenses incurred and the revenues received. In addition, since technology is changing every aspect of the baking industry, management should be aware of the various software and computer programs that are readily available for their use and benefits. Keywords: cost control, bakery operations, waste reduction, systematic approach, productivity 4
    • Table of Contents Abstract ...........................................................................................................................................4 List of Illustrations.........................................................................................................................6 Executive Summary .......................................................................................................................7 Internal Hand-on Training to Enhance the Cost Control ..........................................................8 Methods ........................................................................................................................................8 Results ........................................................................................................................................10 Conclusions ................................................................................................................................11 Systematic Approach ...................................................................................................................12 Methods ......................................................................................................................................12 Results ........................................................................................................................................13 Conclusions ................................................................................................................................14 Designing Bakery Menu to Enforce Cost Control ....................................................................15 Methods ......................................................................................................................................16 Results ........................................................................................................................................17 Conclusions ................................................................................................................................18 Tools and Equipment to Control Cost .......................................................................................19 Methods ......................................................................................................................................19 Results ........................................................................................................................................20 Conclusions ................................................................................................................................20 Appendixes....................................................................................................................................22 5
    • List of Illustrations Figures Figure 1 Five Steps of Training Cycle ...................................................................................8 Figure 2 Steps of Training ......................................................................................................9 Figure 3 An Example of Bakery Menu ................................................................................15 Figure 4 Menu Engineering Chart ........................................................................................18 Tables Table 1 Process of Systematic Approach ............................................................................12 6
    • Executive Summary Connie Inukai, the English professor at University of Maryland Eastern Shore at the Universities at Shady Grove, asks four students in her technical writing class to research the methods cutting waste in bakery operations and reduce food cost percentages. In order to cut costs and waste through training, one would have to hire employees with previous bakers’ experience. The systematic approach to cost control can cut costs and waste by reducing the space in work area. For example, the preparation table is located between the walk-in cooler and the oven, which eliminates footstep and time. Another approach is time management in terms of how each employee is scheduled efficiently based on previous sales history. In order to cut costs and waste through menu design, management may choose menu items that are complementary to another based on the need of the same ingredients. Another useful method would be to format the menu in such a way that it gives the customer optimal choices as well as touching on the focal points the owners choose to accentuate. An efficient use of tools and utensils would include baking goods of a similar nature at the same time. For example, baking cakes and cupcakes in the same batch reduce the time that the cakes are baking in the oven, and therefore reduce utility costs. Another effective tool is the use of the CakeBoss software which allows the bakery to configure and calculate recipes, convert yields, print orders and shopping lists, and manage accounts receivable and payable reports. From their research, the students concluded that the four most important aspects of cutting cots and reducing wastes in a bakery are effective training, systematic approach, creative menu designs, and strategic use of tools and utensils. In order to complete this research, the students looked at: o Various local bakeries o Various restaurants’ point-of-sale systems o Kitchen layout o Reduction of waste through the production Based on research, the students recommend all four methods to achieve profitable bakery operations. The ability to incorporate all of the aforementioned methods will result in the most financially efficient food service businesses. 7
    • Internal Hand-on Training to Enhance the Cost Control As with many other industries, cost control is a crucial factor for a bakery business. Employees can be taught in cost control skills through training. The development of internal hands-on training for a business can reduce the cost of planning a training program and can be optimized for its unique situations. Thus, developing the most comprehensive internal training plan is crucial for a bakery business. Based on research, the usage of the training cycle is the best cost control training approach. Methods The training cycle is the series of steps or stages that comprise a complete training program. Figure 1. Five Steps of the Training Cycle. o Define the needs of training All of the necessities and purposes of training must be addressed to achieve the best results. Some of the most crucial training needs are:  Improving morale of employees  Requiring less supervision 8
    •  Lowering the occurrences of accidents  Providing a chance for promotion  Increasing productivity o Develop internal training program Once training needs have been identified, the next stage is to develop the actual training program. It should be aimed to ensure that this systematic approach is complied with the training needs. This developed training program should be consistent and updated when required. o Conducted the training Training should be led by experienced and skilled facilitators such as executive chef for the kitchen or the manager for the front. It is essential that training is regarded as a type of reward and valuable experience. Also, training facilitators need to understand and cater to different learning and communication styles. Training can also be applied to improve skills performance. Figure 2. Steps of Training 9
    • o Monitor the training This stage is to ensure that all learning outcomes are applied and reinforced in practice within a mistake-permissible environment. It is also the stage to monitor the development of individual learners and review their progress. o Evaluate the training This stage deals with the collection of information on the result of the training. It is important to know the extent to which the training program has succeeded, which can be measured thorough established evaluating methods such as a written test or practical demonstrations by the trainee. Results o Through research on defining the needs of training, it confirms that training improves the employees’ morale by helping them to acquire job security and satisfaction. Well-trained employees will need less supervision, additional training, as well as a lower chance of mistakes. Also, employees become more eligible for promotion through training because their skill set increases exponentially. Practical applications in real life encourages employees to be even more productive. o Development of internal training programs becomes more efficient once the needs of the training are identified. Training programs that are customized, comprehensive, and yet easy to understand can be produced. o If the training is conducted with the notion of the different learning levels and styles of the trainees, the employees become more engaged with the contents of the training which enhance the result of the training. Also, by paying close attention to the individuality of 10
    • employees, social relationships may develop between the management and the staff members, leading to a cooperative, cohesive unit of operation. o Monitoring the applied training provides crucial opportunities to observe the effects of the training, and suit to practical needs. o The evaluation stage helps those who evaluate learning program to make sure whether the current training satisfies the needs of training or needs any improvements. Conclusions As stated above, training needs must be first identified for the program in order to be successful. The result will always be beneficial to the business. A poorly trained employee will eventually lead to poor performance, which would ultimately result in costly mistakes. Therefore it is critical that the business invests in a proper training program to ensure that it is worthwhile for their business to teach the employees. Through research on the internal training program for the bakery industry, we found that the one of most effective training methods is through the systematic approach of the training cycle. 11
    • Systematic Approach Cost Control is an on-going strategic plan that involves the vision of an operation’s success, monthly and annual financial goals, and the daily evaluation of productivity. It involves much more than managing waste and is one of several important elements necessary for an operation to be able to compete in the marketplace effectively. Control means to exercise authority over and restrain. Every foodservice operation, regardless of its size or method of service, should have a cost control system in place. Owners and managers need together and review information regularly about the expenses incurred and the revenues received. They need to compare the actual results to established standards and budget guidelines for purposes of analysis. No one can possible see everything that can cause costs to be out of line. Hence, cost control is vital and can be the difference in the success or failure of a business. PLAN Vision & Mission ORGANIZE Organization Design LEAD Leadership CONTROL System/Processes Strategize Culture Decision Making Strategic Human Resources Goals & Objectives Social Networks Communications Groups/Teams Motivation Table 1. Process of Systematic Approach Methods A large part of cost control is to keep waste to a minimum and to utilize resources as efficiently as possible. This includes and is not limited to the purpose of cost control, which is: Provide management with the information necessary to make day-to-day operational decisions 12
    • Monitor the efficiency of individuals and departments Inform management of what expenses are being incurred, what incomes are being received, and whether they are within standards or budgets Prevent fraud and theft by employees, guests, and purveyors Be the basis for knowing where the business is going, not for discovering where it has been Emphasize prevention and not correction Be proactive and not reactive Maximize profit and minimize loss Results After all the methods mentioned above are accomplished, managers will have an effective cost control system in place. They must remember that cost control is a part of the entire management process and can accomplish this by having a systems approach or a documented plan with procedures for how to handle each operational element. The systematic approach of planning, organizing, leading, and controlling will improve the cost control strategy. Planning involves designing a menu and establishing your food and labor cost standards. It gives you a clear picture of what it is you want to accomplish. Organizing focuses on establishing the procedures for accomplishing your objectives. Leading is using the information gathered to guide the activities and efforts of your employees. Controlling measures the actual results and compares them to your plan. All the results ensure that a cost control system is effective and valuable. 13
    • Conclusions Cost Control encompasses all areas of a business, from purchasing and checking deliveries, bookkeeping and cooking, to making bank deposits and paying bills. It is an on-going process and requires the complete cooperation and participation of all employees for success. Therefore, as managers, it is our responsibility to establish, support, monitor, and enforce an effective cost control system. We have to lead by example and set the standards for employees to follow. The success of a business does not happen by chance, but as the result of some very careful advanced planning, organizing, leading, and controlling. Every decision we make is a financial one and has a significant impact on our success or failure. This is a good reason we must have a cost control system as part of our overall and daily business plan. 14
    • Designing Bakery Menu to Enforce Cost Control When other factors such as purchasing, receiving, storing, issuing, and production are all in management’s control, menu format and product pricing may be the only factors that affect a bakery’s profit margins. The menu is an effective way for the managers to communicate with guests. In many bakeries, menus are separated based on categories: cakes, pastry, cookies, bread, etc. Regardless of the menu format, the menu is an excellent way to build sales and communicate any special within the operation. Therefore, it is necessary to design menu that promotes what bakery owners want to sell. Figure 3. An Example of Bakery Menu 15
    • Methods When designing a bakery menu, managers need to consider the appropriate menu format and item selections that are appropriate to the target market. After the menu is finalized, it is important to keep an accurate sales history and conduct sales analysis. In a typical food service operation, menu format is designed in the following categories: o Standard- printed menu that are recited by the staff. o Daily- menu that changes everyday. o Cycle- menu in effect for a specific period of time. As important as the format is to a food service operation, the menu selection is just as important. The options an operation select to put on a menu has a dramatic effect on the menu cost and waste. To elaborate, each ingredient an operation purchase for production should have multiple usages and purposes. For example, when a bakery imports fresh fruit, not only can the kitchen staff incorporate it into fresh fruit cakes and tarts, the “mediocre quality” of the fruit can be used as jams and sauces and reduce waste. Menu engineering is defined as the study of technique that displays a list of product or service offerings for consumer choice. The goal for menu engineering is to increase profit margins by identifying the most popular and least popular items in a food service establishment. It is almost certain that every bakery establishment has a few best sellers and other items that are not as popular. Therefore, the goal of menu engineering is to determine which products are generating more profits and which products the bakery should get rid of. In order to determine the menu mix, the bakery operation must first figure out the contribution margin and the number of each items sold. 16
    • o Contribution margin is determined by subtracting the items’ cost from selling price. o Number of items sold is derived from accurate sales history. Results When determining the appropriate format for a bakery menu, it is important that the menu design is more flexible than restaurant establishments. Unlike restaurant, bakeries and cafe generally use a combination of all three formats; there is a printed menu behind of main service table and for guests to take home, a daily menu that changes with daily and seasonal offering, and also a cycle menu when the bakery wants to market a “Friday special”. Therefore, it is easier for a bakery to make adjustments to its original. The operation will feature an item as a daily or monthly special. And once the item as gain popularity, it can be adjusted into a permanent menu. When choosing items to sell in a bakery operation, it is important to choose items with ingredients that are least perishable and complementary to other items on the menu. During production, waste can also be eliminated if the kitchen staff turns “waste” into a usable “menu item”. For instance, when producing a chocolate cake, the cake tops and crumbs can be used to make cake-pops, a new, trendy item that is popular in younger age group customers. Menu engineering is the technique that food service operation use to determine which items stays and leaves the menu. It is important that an accurate sales history is kept at all times and the calculation of food cost is accurate. To represent the calculations in matrix, menu items are on a graph. 17
    • Figure 4. Menu Engineering Chart The contribution margin (x-axis) and number of items (y-axis) are used to determine the placement of menu items. When an operation conducts sales analysis, the menu items are placed on the menu mix chart to determine its status. Depending on the position of an item, management may need to make decision to improve its status, such as using different ingredients to cut food cost or to simply cut it off the menu. Conclusion Menu design is a crucial element in determining the success of a food service operation. The format, item selection, and sales analysis are all useful tool in promoting the products in the restaurant and helping reduce waste in the operation. It is our job to inform restaurant managers that we must turn the potential food waste to actual profit. 18
    • Tools and Equipment to Control Cost As with most businesses, cost control is a huge factor that takes place in the success of the business. Equipment, tools, and software can be intergraded into ones bakery to help the bakery carry out daily functions and operations. This is proven to be true because of how labor intensive the jobs are, the long shifts, order times, and customer service. Therefore, by upgrading our systems and installing programs will help us understand what customers want. And purchasing more modernized tools will make a noticeable difference in our daily operations. These include cutting costs and turning a higher profit. Methods Acquiring tools and softwares will allow our customer to design exactly what they want and allow the staff to create a product that meets their specifications. These tools include: Cake boss pro o A software which allows the baker to do everything from a computer, except making the actual cake. It converts yields, cost out recipes, prints shopping lists and invoices, tells one the exact cost of cake, track expenses, calculate profit and run reports to see exactly where revenue is coming from. Wedding cake design pro o This directly designed for wedding cakes it allows the baker and customer to sit down with one another and create the cake the customer wants. The program has hundreds of color schemes and design patterns to choose from. They can decide 19
    • on number of tiers, shape, size and layers. The colors, designs and floral prints can be mixed and matched until the desired product is achieved. KopyKake’s o A company with a product line specific for the baker, they offer numerous tools to help improve efficiency. They make tools such as printers, projectors, stencils, edible ink cartridges for printers, edible ink markers and pens for drawing or tracing. They have paper you feed through the printer which will print a picture to be inserted on top of the cake and it is a 100% edible. We can also set up a “build your own” template on our website to give our customers and idea of what we are capable of. Results Once the employees have finished proper training and understand the systematic flow of the new tools and software, they can start using them in their everyday operations. From there, we will meet with the customer, gather the exact specifications, and create a product at cheapest cost to us regarding ingredients and labor hours. Using these tools will cut down on both financial and economic costs. Reducing the time spent on free hand design of the product will reduce the labor wage costs and the ease of software design will cut down on the economics costs. Using these tools will also cut down on the amount of “do-over” caused by a simple mistake in the design and implement phase. Conclusion Insuring our employees have the proper knowledge of the software and how to implement it into recipes and actual production itself will greatly benefit a bakery operation. 20
    • This will also help the employees stay focused and ensure the customers’ exact needs are fulfilled. Incorporating this software will increase the amount of baked goods sold and increase production from our organization. In addition, it will offer services that we could not create without the software, therefore expanding business, increasing production and revenue while keeping costs down. Through research on the tools and software for the bakery industry, we found that the most effective ways of cutting costs is through proper training, systematic approach, creative designs, and efficient equipments. 21
    • Appendixes Bakery Reduces Ingredient Waste and Bad Batch Costs by $39,158. Retrieved Apr. 26, 2013, from http://doranscales.com/success-story/bakery CakeBoss pricing software, recipes, tutorials, and more for bakers and cake decorators. (n.d.). CakeBoss pricing software, recipes, tutorials, and more for bakers and cake decorators. Retrieved May 2, 2013, from http://www.cakeboss.com/ Hine, S., Thilmany, D., Kendall. P., & Smith, K. (Feb. 2003). Employees and Food Safety: Is Training Important to Food Service Managers. Journal of Extension. Retrieved from http://www.joe.org/joe/2003february/rb1.php Kopykake Enterprises (Official Site). (n.d.). Kopykake Enterprises (Official Site). Retrieved May 2, 2013, from http://www.kopykake.com/ Master the Art of Menu Engineering. Retrieved Apr. 26, 2013, from http://www.nestleprofessional.com/united-states/en/SiteArticles/Pages/Master-the-Art-ofMenu-Engineering.aspx n.d. Training & Coaching Advices. The Training Cycle. Retrieved fromhttp://www.thetrainingcycle.co.uk/ Training cycle. (n.d.). In Businessdictionary.com. Retrieved from http://www.businessdictionary.com/definition/training-cycle.html Wedding Cake Design Pro Software from Topplestone, LLC. (n.d.). Wedding Cake Design Pro Software from Topplestone, LLC. Retrieved May 2, 2013, from http://www.weddingcakedesignpro.com/ Wilke, J. (Jul 24, 2006). The importance of employee training. Jacksonville Business Journal. Retrieved from http://www.bizjournals.com/jacksonville/stories/2006/07/24/smallb2.html 22