December 24, 2015
Restaurants get and stay profitable through diligent cost control. Do you know what your true food cost is on a daily, weekly, and seasonal basis? Restaurant enterprise software ChefMetrics tracks all food expenditures to nail down your true food cost, and helps you test the profitability of recipes so you’ll know if every item on the menu makes money.
Creighton Wong came up with ChefMetrics after bakery franchise owner Mike Ferretti asked if there was a better way to track costs for Ferretti’s business, Great Harvest Bread Co. In the food business, with margins so slim, Ferretti wanted a more detailed way to track food cost and build better recipes, and the current technology simply wasn’t good enough.
Using ChefMetrics, an owner and chef can understand the impact of small fluctuations ingredient costs have on overall profitability. Wong said that after Great Harvest used this tool to rework and refine the menu and remove several high-volume sellers that weren’t profitable from their menu. Even though these had been available to customers for over 12 years, they just weren’t making money for the bakery and held back business growth. Using the software, Great Harvest found that even if a recipe was breaking even, it still represented a lost opportunity cost. This idea works well for all types of food business. High-volume catering businesses can also use ChefMetrics to capture their true food cost.
“If you can squeeze and extra quarter of profit out of a sandwich, for a small shop that caters 500 a day that’s almost $45,500 extra yearly profit,” said Wong.
Wong said he has 12 restaurants coming on board soon. The one issue to handle with each new user is the different needs of each type of restaurant. Uploading recipes and using the correct yield percentages for ingredients is vital to success.
“A bakery is different from a steakhouse and each steakhouse is unique. If a steakhouse butchers its own meat, they have different needs and the yield calculations have to be adjusted depending depending on how the meat is used. Every butcher is unique.”
On a regional scale for chain restaurants, ChefMetrics allows owners to track costs and yields for their ingredients and recipes across states. This allows for regional menu adjustments to enhance profitability.
At this point, ChefMetrics is focused at the restaurants, caterers, and hotels. There are applications for suppliers which may be the next iteration of the business. Creighton is working to on-board the first batch of users. Doing so requires time to input each store’s recipes and needs. Not every owner has the same requirements of the system. These customized settings take time to properly carry out. According to Wong, taking the time to get it right each time for each user is key to ongoing success.
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