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10 ways to mitigate food inflation

26 July 2013 by
10 ways to mitigate food inflation

1 Join it up Often, the food value chain in catering businesses is not joined up. Once a firm gets beyond a certain size, new staff are appointed to handle different areas of interest - menu planning, equipment sourcing, and so on. Better communication can yield big savings.
"This is what the great caterers do, they sweat it like mad: what am I going to put on the menu? how big is it going to be? what are the specifications of the product? what equipment do I have? what skills do I need? Joining all those things up into one thing is a big step," says Read.

2 Evaluate the front end of the business Make sure that what you are selling is marketable, affordable and has secure supply. If the products you require are volatile in their price and supply, then it may make sense to be able to produce them yourself; that way, even if the input costs cannot be controlled, you still have control of your supply.

3 Think about make or buy Beating up your supplier with a baseball bat is not as effective as considering whether you should make or buy foodstuffs. Can you bake bread more efficiently than a supplier can?

For larger operations, which require large volumes and can afford the investment, it may make sense. But Read points out: "There are times when it is possible to make a much better product by asking a third party to produce it for you. Bakery is a really good example. In London you have all these artisan bakers all over the place now, just brimming full of great, innovative, fresh product."

4 Focus on food waste It may sound obvious but hospitality businesses can end up wasting a lot of what they have spent a considerable amount of money buying in in the first place. In particular, check the size of your food portions. The vast majority of waste consists of food that comes back on the plate because the portions are too large or not right for the customer.

5 Review production Keeping the production process simple is key.

"Chefs are under a great deal of pressure to conjure up more value on the plate," says Read. "What we have observed is that lots try to do that by adding complexity. But what adding complexity does is create more cooking, and when you create more cooking usually it has to happen with the same labour. The ultimate result is that the quality drops.

"It is important to pay attention to the number of cooking processes in every dish and to consider how dishes are constructed in order to get real simplicity."

6 Sweat the spec If you are buying a more expensive ingredient, ask whether you really need to. Do you have to have hydroponically grown French vine tomatoes when UK soil-grown ones would do, for example?

7 Get your distribution right Many operators are not getting their distribution right. For every business there is an optimal model. If you have a high level of spend, or source a large amount of one or two key ingredients, for example, then the chances are you should be looking at central distribution or a hybrid model, rather than buying through cash and carry or wholesalers.

8 Review the packaging Know how to specify well with your suppliers so you don't end up with a tonne of cardboard on your back doorstep. All the guidelines for working with suppliers are available on the Wrap website at www.wrap.org.uk

9 Maximise source Central distribution allows operators to talk direct to suppliers. "You can raise quality and provenance but also mitigate food inflation," says Read. "A typical food wholesale margin from a butcher or supplier would be between 40% and 60%. A typical distribution margin would be just 15%."

10 Be informed "Being informed is really important. It was fine six or seven years ago when there was real stability in food pricing; now there isn't. We need to know what is happening now and, more importantly, what is going to happen in the future," says Read.

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