7 Tips for Inventory Management in Cafes and Coffee Shops

A small business owner who runs a cafe or restaurant and seemingly does a hundred other tasks simultaneously always has full hands. You have a never-ending list of tasks. It can be challenging to find time to do other things, least of all your matters. But there is some good news!

You can save many hours of work every month by introducing a few strategic changes to your inventory management system. How can you do this? For a start, make sure your employees are fully engaged in the crucial task of inventory management. Make them aware that if you are to stay in business and care for their jobs, then they must help you monitor closely the cost of goods sold.

7 Tips for Inventory Management in Cafes and Coffee Shops
A cafe kitchen area @uniwell4pos

Importance of Restaurant Inventory Management (R.I.M)

The R.I.M. is a procedure that is widely used to monitor the supplies and ingredients available for shifts in real-time. As noted, this system can help the proprietor of a cafe to make more economical orders on food, supply, and beverage. A sound inventory management system is essential for improved day-to-day operations and the achievement of long-term goals.

Keeping close tabs on your café inventory can help you realize several goals at the same time. For instance, you will be able to reduce food wastage, prevent under-ordering, deter theft, better monitor the health of your business, along with a derive myriad other benefits.

We will now provide some fundamental tips that can help you manage the inventory in your café. Moreover, we will briefly show you the methods of taking an efficient inventory. You will further learn why a restaurant inventory impacts your bottom line.

Consider the seven tips below for superb inventory management of your café or restaurant business.

But first, check out our guide on How to Schedule Employees at a Restaurant or Cafe!

Restaurant Inventory Management Tips

1. Take inventory by hand/utilize a P.O.S. system

Utilizing a POS (point of sale) system will give you many advantages. This includes integrated accounting, order planning reports, data forecasting, and automated inventory tracking premised on customer ordersA POS system will, however, not tell you about certain important sources of inventory loss. Examples are spoilage, spillage, incorrect or inefficient drink or food preparation process, theft, and customer complaint resolutions. You can only have this data if the information is fed manually. This means that taking an inventory by hand is still the best way to get a more accurate and better-rounded report.

2. Assign the same staffers to track inventory

You should designate just a few people to help you take your inventory. You may, for instance, use the chef and the managers to execute the task. Why should you do so? This makes it easier to discover inconsistencies. Moreover, since these workers will consistently take inventory, they will gradually understand the nuances and patterns involved in managing a unique inventory.

Thoroughly train the employees on the processes involved. This guarantees accuracy in inventory management. Consider giving the employees some bonuses accruing from inventory savings. Explain to the staffers how a proper inventory tracking significantly impacts your bottom line.

 3. Keep a consistent schedule

Following a consistent schedule will enable you to understand how much of the supplies and ingredients are utilized in a given period. You can, for example, check popular ingredients and perishables daily. Bulk items and non-perishables may be counted just once or twice a week. In time, you will begin to see patterns that can help you adjust your menu, orders, or offerings as necessary.

Set an appointed day and time for placing orders. It is essential to schedule a time that is free of interruptions. This allows you to focus on the immediate task. You need to replenish your inventory in a way that works to give your customers all the items required. You can do your inventory either before you open or after closing. Having a consistent time and day set aside for inventory will help ensure that this vital task is carried out regularly.

4. Use the FIFO method

Use items in an orderly manner, as they are received. You can do this by organizing the areas (shelves, freezer, cooler, and dry storage) according to the FIFO method. This essentially means first in, first out. Such a system will help you minimize food spoilage issues. You can also achieve something similar by using dispensers and containers that are designed for FIFO dispensing.

5. Create a food waste sheet

While the inventory list can only show the ingredient and supply details, a food waste sheet is useful in showing exactly where the unaccounted inventory goes after the sales. This, in turn, allows you to devise solutions for such lost ingredients.

For example, if your sheet indicates that a significant quantity of food gets spoilt, you can decide to make fewer purchases or find creative ways to use the ingredients. You may notice that the chef consistently makes new dishes on the whim. This could be resulting in a thrown-away meal. An employee might even key in the wrong menu item.

To forestall such undesirable situations, the servers should be extra cautious when feeding in the orders in the system. The P.O.S. system usually includes a place for this. This can help you to input the information in a digital format accurately. Additionally, you can create a food waste sheet by factoring in the columns in this manner: Item, time and date, the reason for waste, amount of weight, and employee initials. Every worker needs to understand how the food waste sheet works so that they can always update it as required.

6. Use surplus ingredients 

If you find that you have excess ingredients in your hand that will soon go to waste, add them into the existing dishes. It is, however, advisable to let the guests know about any abrupt changes in the menu. Also, you can introduce a special offer to the guests. This is referred to as an amuse-bouche. In this way, you can avoid wasting food and still make potential sales.

7. Utilize past inventory insights

You can make highly informed decisions by studying the ingredients that were either under-utilized or over-utilized. Your inventory for the specific period will come in handy for this. Drawing from the P.O.S. system, as well as your by-hand inventory, you can easily predict and understand the trends of the day, week, or the year. You will, therefore, be in a position to make some sensible economic decisions.

7 Tips for Inventory Management in Cafes and Coffee Shops
A point of sale system for keeping inventory @loyversepos

How to Take the Inventory for Your Café

Perhaps you are wondering about how to take a good inventory. Of course, there is no such thing as a one-size-fits-all method for taking inventory of the supplies and consumables in a café. Notwithstanding, the steps below are generally considered as an effective way to keep track of a restaurant inventory.

Check out our article Best POS Systems For Small Cafes, now!

Step 1. Create a table

You can start by making five rows in a customizable inventory management system or a restaurant inventory sheet. Label the rows in this manner:

  • Items
  • Measuring unit
  • Inventory Amount
  • Price
  • Total Cost

Step 2. List the items

Write down all the items available in your restaurant. Put these under the Items column. Include everything; edible ingredients, dinnerware, tabletop items, and cleaning supplies.

Step 3. Add the units of measurement

Indicate the unit of measurement that you plan to use in determining the quantity of each purchased item. Write this in the Unit of Measure column. This can vary, depending on how foods and supplies are sold. You can, for example, purchase tomatoes in pounds, paper towels in cases, and pasta in boxes. It is vital to have all these units documented from the start. This helps to avoid confusion or miscalculations.

Step 4: Use the restaurant inventory software

Measure-up or count the items: Find out what units you have of every item. Add the figures on the column for Inventory Amount. This will allow you to standardize the measurements and easily calculate the costs and waste. For example, you should write 20 pounds of tomatoes as 20, 25 cases of paper as 25, and 6 boxes of pasta as 6.

Step 5. Insert the unit price

Outline all the unit prices. Add them to the Unit Price column, available for each item. To do this, divide the cost of a single unit by the amount of the available item. As an example: If a pound of tomatoes costs $2 and you find that you have 1 pound in the inventory, the unit cost is $2.

Step 6. Calculate the total cost

Multiply each item’s unit price by the amount of the item that is available in your inventory. After calculating the total cost for all the items in your inventory, indicate these numbers on the Total Cost column. For instance, if 20 pounds of tomatoes cost $2 a pound, the total cost is $40.

Ensure that you know how to calculate the average daily inventory cost for your café. This will help you to make more accurate purchasing decisions. To do this, divide the total inventory cost applicable for that period of purchase by the number of days in this period. Your café’s statement for profit and loss should contain all the figures required.

7 Tips for Inventory Management in Cafes and Coffee Shops
Cafe kitchen and P.O.S system on the table @cafepossolutions

Whether you manage a large restaurant chain, an upscale bistro, or a hospital cafeteria, the general importance of proper inventory management is evident. If you want more ways to boost your bottom line, consider re-evaluating such things as the pricing on your menu and overhead costs.

By deciding to change some ineffective inventory and ordering habits significantly, you can substantially reduce stress while also saving time. Who would not want to enjoy such benefits in a small business enterprise like a cafe? Of course, everyone would.

Thanks for reading with us today! Drop a comment down below on how these tips have improved your management skills on keeping tabs on your inventory!

For more helpful Brand My Cafe guides, head over to these articles: Inventory Management Apps for the Food and Beverage Industry, 27 Entrepreneur Quotes To Uplift & Motivate You, 5 Tips to Managing Millennial Employees The Right Way, and Why You Need Custom Coffee Sleeves For Your Business.

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