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Put the cosh on price creep

05 July 2013
Put the cosh on price creep

The catering industry will have to toughen up if it wants to survive inflation's rise, says Caternet managing director Jerry Brand

Forget discussions of imminent or future improvements, and don't waste time on being shocked and appalled at how the price of meat and fruit appears to be spiralling ever upwards. Stop right now. Take stock (pardon the pun), and grab complete control of anything and everything that affects your bottom line.

That means coming down hard on waste management, price hikes, stock control and undercharging, to name just a few of the common ways we seem to haemorrhage money in this sector.

In a poor financial environment, cash is king. In food and 
beverage operations, that makes it crucial to get your stockholding right. If you don't, your people are tying up the business's free cash and that can be a considerable figure in terms of value, depending on the complexity of 
multiple stock locations.

Far too many people worry about price comparisons. The silent killer for margin through higher costs is price creep. The future for e-procurement is to have all suppliers participate in managing their agreed products and prices with each hotel/catering business. That way, the business is protected from price creep and margin reduction, the chef has the quality suppliers they want to use, and the customer pays the right price for an enjoyable experience - and their loyalty grows.

Dare I mention it, but food and beverage operations are notorious for wasting food at service time and, even more importantly, not learning from their mistakes.

Having the ability to look at all the statistics before (planning), during (operating) and after (results) foodservice will make a big difference. That way, the next time the team delivers any service or event, they will be able to improve on wastage and reduce the amount of lost revenue.

If you start looking at a few of these areas will it change your life? Probably not, but a few simple steps like these could pull back a hell of a lot of what will otherwise be lost revenue. And that's got to be food for considerable thought, hasn't it?

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