For a food production business wastage can be a huge make or break factor for your business.

You must be sure to have enough stock to produce the expected demand that your customers require. And if you run out due to not making enough or having to throw out food because it has expired, the cost to the business can really add up.

So how do you manage to avoid this situation? By having a well-designed food inventory management system. Food inventory management is your system for tracking stock coming into your business, what leaves and what’s leftover. A good food inventory management system is also the most useful tool for gaining insight into the ways you may be losing money.

Reducing wastage is key to growing profits. The following are a few tips to get started on the right foot.

Perform Regular Stocktakes

Having a consistent stocktake system in place is one of the most important parts of a food inventory management system. Create a stocktaking schedule and stick with it. How often is up to you, but keep in mind the more often you take inventory, the better. The important thing is to have a system that takes into account the different types of stock you have and the different ways you use or sell it. 

Set A Reorder Point

Knowing the minimum limit you have on stock before you reorder will help you determine exactly when you need to place an order. A “par level” is the minimum amount of any item you can afford to have on hand to satisfy customer demand before ordering more. Once you hit that level, it’s time to place a purchase order. Knowing your reorder point or par level is essential for avoiding stockouts.

Efficient Product and Menu Design

It’s more economical to use one ingredient for multiple products or menu items than using one product for one item. For example, ordering strawberries for only one dish can become expensive if that dish isn’t a top seller. Instead, you could use strawberries to make a sauce, to garnish a dessert, and to flavor a cocktail.

Menu design goes hand in hand with effective food inventory management. The more you can reuse your products the lower your cost of operation.

Use Food Inventory Management Software

Instead of calculating everything by hand or complex excel based spreadsheets, you can invest in a food inventory management software that tracks it for you automatically.

A good software can automate purchase orders when you reach your reorder point, can report on stock expiry dates,  can implement batch to reduce spoilage, and can optimise your stock for long-term business growth.

Watch this recording from our founder PK as he introduces the use of Dear Systems for food-based businesses. 

If you have any questions about this video and would like to know more about this system for your business book a chat with PK here.