Food purchasing control

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Food purchasing control

  1. 1. Food Purchasing Control<br />Slide 1 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  2. 2. Recap of the Previous session<br />What is the Cost/Volume/ Profit equation?<br />How is Variable Rate defined?<br />What Contribution Rate?<br />When is the business considered in the state of Break Even.<br />How is Contribution Margin defines?<br />Slide 2 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  3. 3. KCM of the session<br />Outline the purchasing process in the operations of foodservice establishments.<br />Describe how quality standards for food purchases are established.<br />Reasons that standard purchase specifications are important<br />Describe the process used to determine the quantity of perishable food purchased.<br />Slide 3 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  4. 4. Scope of the session<br />Developing standards and Procedures for Purchasing.<br />Standard Purchase Specifications.<br />Par Stock.<br />Periodic Order Method.<br />Perpetual Inventory Method.<br />Centralized Purchasing.<br />Slide 4 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  5. 5. Sequence of Operation<br />Purchasing.<br />Receiving.<br />Storing.<br />Issuing.<br />Producing.<br />Selling and serving.<br />Slide 5 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  6. 6. Categorizing the foods<br />Meat and fish Fresh and Frozen<br />Frozen vegetable <br />Fresh vegetable and fruits.<br />Dairy/butter <br />Oil <br />Sauces & dressings. <br />Pulses , pasta and bakery <br />Cafeteria<br />Juices and drinks. <br />Canned fish& meat. <br />Spices ingredients<br />Canned fruits and vegetables<br />Slide 6 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  7. 7. Developing standards and Procedures for Purchasing<br />Objectives behind developing control standards and procedures for Purchasing:<br />Standards for Purchasing are further subdivided into:<br />Quality of food purchased.<br />Quantity of food purchased.<br />Prices at which the food is purchased.<br />Slide 7 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  8. 8. SPS for Black Angus Strip Loin<br />IMPS number 180(INSTITUTIONAL MEAT PURCHASE SPECIFICATION )Boneless 10 ” trimUSDA Prime, upper halfRange #2, minimum 12 lbs., maximum 14 lbs.One - half to three - quarters of an inch fat, except for seam fatChilled upon deliveryFree from objectionable odors, no evidence of freezing<br />Slide 8 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  9. 9. SPS for Salmon Fish<br /> Whole, dressed, fresh day of deliveryMinimum 8 lbs., maximum 12 lbs.Fish firm and elastic, meat pink and slightly translucentGills free from slime and reddish - pink in colorScales adhering tightly to the skinNo stale odors of ammonia<br />Slide 9 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  10. 10. SPS for Canned Cherries<br /> Dark sweet, pitted, cannedU.S. Grade A, packed in waterCount per #303 can: 30 to 35Federal inspector ’ s certificate of grade requiredPacked 24 to a case<br />Slide 10 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  11. 11. SPS for Crimini (Italian Brown) Mushrooms<br /> U.S. No. 1Medium, 1 to 1 in diameterLight tan to brown in colorThin - skinned, tender, delicate fleshNo visible spotting or bruising on skinsPacked in 10 - pound containers<br />Slide 11 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  12. 12. Standard Purchase Specifications<br />Standard Purchase Specifications: Are described as an accurate description of the product/s characteristics.<br />SPS features are as follows:<br />Government Grading standard.<br />Weight in total.<br />Date of Production and Expiry.<br />Size ( length)<br />Slide 12 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  13. 13. SPS features<br />Nutritional data.<br />Name of the supplier.<br />Consistency and description of texture freshness.<br />Yield.<br />Area of produce.<br />Range of temperature for storage.<br />Slide 13 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  14. 14. Advantages of SPS in Food service business<br />Exact requirement can be projected.<br />Useful in menu preparations.<br />All misunderstandings between Purchase, Service and Kitchen eliminated.<br />Makes competitive bidding possible within possible purchasers.<br />Eliminate the need for verbal descriptions of a product each time its ordered.<br />They facilitate checking food as received.<br />Slide 14 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  15. 15. Par Stock<br />The term Par stock is largely applied to Perishables:<br />The estimated quantity required or needed for operation is termed as Par stock.<br />The quantity of any item required to meet the anticipated needs in a specific upcoming period.<br />Slide 15 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  16. 16. Stewards Market Quotation<br />
  17. 17. Periodic Order Method<br />Method of inventory valuation for financial reporting purposes where a physical count of the inventory is performed at specific intervals. <br />This accounting method for inventory valuation only keeps track of the inventory at the beginning of a period. <br />The method is used keeping in mind the desired ending inventory.<br />Slide 17 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  18. 18. Slide 18 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  19. 19. Periodic Order Method<br />Amount required for the Upcoming period (40 Cans)<br />Less (-) <br />Amount Currently on hand (12 cans)<br />Add (+)<br />Amount wanted on hand at the end of the period to last until the next delivery(15)<br />= Amount to order (43)<br />Slide 19 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  20. 20. Periodic Order Method<br />Alternately represented as:<br />To Purchase (To order) 43= Consumption(40)- opening balance(12) + Stock on hand(15)<br />Slide 20 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  21. 21. Slide 21 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  22. 22. Perpetual Inventory Method<br />The perpetual inventory method has twoprimary purposes:<br />To ensure that quantities purchased are sufficient to meet anticipated need without being excessive.<br />To provide effective control over those items that are being stored for future use.<br />The method is used bearing and determining the Reorder point<br />Slide 22 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  23. 23.
  24. 24. To calculate the reorder point<br />Reorder point is the number of units to which the supply on hand should decrease before additional orders are placed.<br />Reorder Point =1.5 (Normal Usage per day x # of days to delivery)<br />Normal Usage per day = 2 cans<br /># of days to delivery = 5 cans<br />Re-order Point = 1.5( 10) = 15 cans<br />Slide 24 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  25. 25. To calculate reorder quantity<br />Re-order quantity is the amount that will be ordered each time the quantity of a particular item diminishes to the reorder point.<br />Par Stock 32 cans<br />Less (-) <br />Reorder Point 15 cans<br />= sub total 17 cans<br />+ Normal usage until delivery 8 cans<br />= Reorder quantity 25 cans<br />Slide 25 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  26. 26. Establishing standards for Quality and Price<br />Categories of Food Suppliers:<br />Wholesalers.<br />Local Producers.<br />Manufacturers.<br />Packers.<br />Local Farmers.<br />Retailers.<br />Cooperative associations.<br />Slide 26 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  27. 27. Making Comparatives from comprehensive suppliers<br />Its important to divide suppliers who make supply of Perishables and Non-Perishables.<br />Have at least 2 suppliers for the Fresh main line.<br />Contract with suppliers on the basis of:<br />Past performance.<br />Quote.<br />Adherence to timings frequency of visits.<br />Slide 27 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  28. 28. Making Comparatives from comprehensive suppliers<br />4. Proper and environment friendly vehicles for delivery.<br />5. Maintaining proper temperatures of storage in transport.<br />6. Supplying items as per specification.<br />7. Providing the clients MSDS ( Materials safety data sheet) in case of chemicals supply.<br />8. Ensuring that food products are supplied at least 6 months prior to their date of expiry.<br />Slide 28 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  29. 29. Centralized Purchasing (CPS)<br />Largely used by chain food service operators.<br />Use of a central warehouse.<br />Departmental segregation system.<br />Integral part of the supply chain methodology.<br />Use of a computerized centralized purchase system.<br />Slide 29 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  30. 30. Advantages of a CPS<br />Foods and beverages can be purchased at lower prices because of the volume.<br />Desired quantity can be obtained more readily because the buyer has a greater choice.<br />Foods can be obtained that meet the specifications of the buyer.<br />Larger inventories can be maintained.<br />Reduces dishonest purchasing of individual items.<br />Slide 30 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  31. 31. Disadvantages of CPS<br />Each unit must accept the standard item in stock and has little freedom to purchase for its own peculiar needs.<br />Individual units cannot take the advantage of local specials at reduced prices.<br />Menus are normally standardized thus limiting the individual unit managers freedom to change the menu.<br />Slide 31 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />
  32. 32. Questions <br /> <br />Comments<br />Slide 32 / 30<br />Wednesday, March 16, 2011<br />BAC-4131 Food and Beverage Management Cost Control: :Food Purchasing Control<br />

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