LEARNING PACKET

PHELEC8 Food and Beverage Cost Control System

Learning Packet for HM 3
Week 4 : ______________________

LEARNING PACKET TITLE: COST CONTROL

I. INTRODUCTION:
Control in F & B business is defined as the process by which managers attempt to direct, regulate and restrain the actions of people in order
to achieve desired goals.

II. DISCUSSION / ENGAGEMENT:

4 steps of control process:

1. Establish standards and SP for operations.

2. Train all individuals to follow established standards and standards procedures.
3. Monitor performance and compare actual performance with established standards.
4. Take Appropriate action to correct deviations from standards.

CHECKING AND MONITORING

REVEALS
UNREALISTIC OR INAPPROPRIATE

Control Techniques
1. The control Techniques includes the ff:
2. Establishing standards’
3. Establishing procedures
4. Training Personnel
5. Setting Example
6. Observing and correcting employee actions
7. Requiring records and reports
8. Disciplining Employees
9. Preparing and following budgets

2 principal causes of excessive cost:

Inefficiency and waste

Cost Control is defined as the process used by managers to regulate costs and guard against excessive costs. It is an
going process and involves every step in the chain of purchasing, receiving, storing, issuing, preparing food and beverage
for sale.

WORKING STOCK – Which is the amount that will be used between deliveries.

SAFETY STOCKS – Which is the extra amount of a food product we will keep on hand.
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Determining Inventory Levels

Inventory levels are determined by important factors:

1. Storage Capacity
2. Item perishability
3. Vendor Delivery Schedules
4. Potential Savings from Increased Purchase size
5. Operating Calendar
6. Relative Importance of stock outages
7. Value of Inventory peso to the operator

STORAGE CAPACITY
Operators must be careful in determining inventory levels in a way that will overload storage capacity

ITEM PERISHABILITY
If all food products had the same shelf life , that is if all items would retail their freshness, flavor and quality for the same number
of days.

VENDOR DELIVER SCHEDULE

Vendors readily let an operator know what their delivery schedule is to a certain area and it is up to the manager to use this info to
make an educated decision.

POTENTIAL SAVINGS FROM INCREASED PURCHASE SIZE

Substantial savings by purchasing large quantities and thus receiving a lower price from the vendor.

OPERATING CALENDAR
Relative Importance of stock outage. Value of Inventory peso to the operator.

SETTING THE PURCHASE POINT

A purchase point, as it relates to inventory levels, is simply that point in time when an item should be reordered.

THIS POINT IS TYPICALLY DESIGNATED BY ONE OF THE TWO METHODS:

AS NEEDED – They basically are purchasing food based on their prediction of unit sales and on sum of the ingredients from
standardized recipes.

PAR LEVEL – predetermined purchase points called par levels. 25-50% added for safety stock BUT HOW ABOUT HIGHLY
PERISHABLE?

III. ASSESSMENT: Answer the following:

1. What is par stock in food and beverage management?3pts

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2. What PAR stands for?3pts

3. What a par stock level is and how is it calculated and used in the kitchen? 4pts

Prepared Reviewed

DYANN S. RAMOS, CPA, MBA

Head-College of Business and Management
EDWINA LYN D. DULAY Education
BSHM Instructor
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Date: _______________________

Date: September 3, 2021