Controlling food cost in a restaurant is a challenge because it is one of the largest expenses of the business. In order to manage this expenditure more effectively, online restaurant management tool Orderly has launched a Restaurant Food Index (RFI) with a comprehensive directory of prices restaurants pay for their ingredients.
Restaurant Food Costs
When a restaurant is profitable, the food cost alone accounts for 28 to 35% of the operation. This can go up or down depending on a wide range of factors including season, the product, location and supplier.
The goal of the Orderly Restaurant Food Index is to give restaurant owners the latest and most accurate price of the items they are going to be purchasing in the market. This will allow owners to negotiate with more confidence and without being taken advantage of.
According to Orderly, the average restaurant uses over 10 suppliers to make purchases in any given week, this leads to 92% of owners overpaying on their orders. Considering it accounts for almost a third of a restaurant’s total expenses, overpaying can be very costly.
As restaurants look for local suppliers to provide the freshest ingredients, knowing the best price also becomes that much harder for locally harvested or produced items. The index looks at a large set of data to give you prices from local and national suppliers.
Restaurant Food Index
The Restaurant Food Index will give owners weekly market prices on more than 600 popular ingredients while at the same time being able to see local and national price trends.
The index gives restaurants access to a searchable database in real time on mobile devices through an app. This data is compiled from more than 100,000 food purchases which have been placed by over 10,000 suppliers and thousands of independent restaurants across the US.
Orderly breaks down this data and organizes it so local restaurants are able to make the best possible purchases as indicated in the index. The app also maps the purchases of a restaurant while it also points out the closest supplier.
Better Management and Transparency
Orderly provides a solution for restaurants which allows owners to better manage their business. The technology it provides eliminates data entry and counting inventory so you can take control of your food spend.
All you have to do is take a picture of your inventory and invoices, update your weekly sales and Orderly does the rest.
The new Restaurant Food Index service will provide price transparency so restaurant owners can stay ahead of pricing trends and price the menus they offer to their customers accordingly.
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More in: Restaurant / Food Service Business
There should always be an update on this. Food costs can rise and plunge down without you noticing.
If this can automate your inventory, this can really be a big help for restaurants that constantly have to update themselves with the count of their food items and the prices.