Why is it important to have a reduced inventory at your restaurant?

In this post we want to show why is it important to have a reduced inventory at your restaurant.

Why is it important to have a reduced inventory?

Every customer is different, but I often see this scenario. I worked with a restaurant where they sold drinks worth £25K a week, and had stocks worth £64K.

So every week they hold £64K/£25K = 2.6 times the amount of drinks they usually sell, and they still place orders for more product weekly!

This is usually a case of poor inventory management. It wouldn’t be the case if this restaurant keeps high value bottles, as do many exclusive restaurants with exclusive cellars. Here the high value stock gives the restaurant a business advantage.

But this is not the case, this restaurant rotates all its drinks throughout the week and has little exclusive product, so they should reduce their inventory and improve their control.

Advantages of reducing your stock

What are the advantages of having a reduced inventory?

1) What is not in our stocks is money in the bank. Cash is king!

2) Low inventory means less waste

3) Lower inventory means we have a lower risk of breakage. Not only of a bottle breaking, but you could also have an electric problem and then all your food in your fridges and freezers would go in the bin.

4) Reduced inventory means less chance of theft. If we have more control over our stock, the team would notice and theft would reduce.

5) Reduced inventory means better control. E.g. If we have 1000 books at home and someone comes and takes one, we are not going to realise it, if we had 10, we would definitely notice that it’s missing. Same with bottles and ingredients at your restaurant.

6) Efficiency in doing the stock take, as it would take much less time to do the stock take every week

Here is a video showing how to do inventory. We hope you find it useful.

You can buy the stock take template here:

stock take template

RECOMMENDED READ: Why is inventory important for your restaurant?

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