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INVENTORY CONTROL
BY DR. ANNA QUEK
Term 3/2019
LEARNING OUTCOMES
On the successful completion of this lesson, you should be able to:
Describe the process of inventory control
Explain the terms bin card, perpetual inventory, physical inventory, shrinkage control, wastage control and
product safety control;
Describe the 5 areas of inventory control, and the receiving process;
Describe the process for issuing of goods to other departments;
Complete a bin card using perpetual inventory method and a departmental requisition request;
Give examples of causes of inventory shrinkage and prevention measures and causes of wastage;
Give examples for product safety control;
Calculate inventory value and use beginning and closing inventory value to calculate food cost;
DEFINITION OF TERMS
Total $896.30
If Scotto’s Supper Club’s Total Revenue for the month of January is $200,000.00. What is the food
cost percentage for that month? ________%
3. PREVENTING INVENTORY SHRINKAGE
Food losses through simple product waste affects costs and profitability of your
business.
Managing the food production process entails control of the following six areas:
1.Waste – cut or trim too much
2.Overcooking – burnt food, cooked too long resulting in loss of moisture and weight
3.Overserving – inaccurate portion control
4.Not making good use of leftover food such as blanched vegetables, gravy,
tomato sauce etc.
5.Bought the wrong products e.g. buying corn kernel instead of corn on the cob.
6.Incorrect storage e.g. storing open jars of sauces and not storing them in the
refrigerator
EXAMPLE OF WASTAGE THROUGH PREPARATION SUCH AS
TRIMMING, PEELING AND CUTTING
Butcher's Yield Test Results
Unit Name: LEURA Date Tested: 14 April 20xx
Yield Test Performed by: AQ
Item: SIRLOIN
Kg
AP Amount Tested: 20
Price per kg AP (As Purchased) $6.00
AP (As Purchased) Price $120.00 AP amount X AP price per kg
Loss Detail Kg % of Orignial Weight
AP Weight 20 100.00%
Fat Loss 3.6 18.00%
Bone Loss 2.4 12.00% loss divided by AP
Cooking Loss 1.12 5.60% Weight X100
Carving Loss 0.8 4.00%
sum of total production
Total Production Loss 7.92 39.60%
loss
AP minus total
EP (Edible Portion) Weight 12.08 60.40%
production loss
Therefore, if 12.08kg (EP) cost $120.00 (AP)
AP PRICE PAID DIVIDED BY EP WEIGHT
EP (Edible Portion) Cost per Kg: $9.93
5. CONTROL PRODUCT SAFETY
Product safety in food and beverage from control
perspective include:
Buying from reputable suppliers, to ensure product
quality supplied.
Proper storage – at correct temperature, prevent
cross contamination.
Using FIFO system to issue products.