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Key Ingredient to Your Foodservice Program: Metrics

Metrics drive foodservice performance, goals and decision making to create successful programs that keep customers coming back for more.
April 11, 2011

CHICAGO - "You get what measure," said Nancy Caldarola, NACS CAFÉ education director, as she kicked off the "Foodservice Metrics: NACS CAFÉ" breakout session last week during the NACS State of the Industry Summit.

Caldarola, with more than 30 years of experience in the hospitality, restaurant, arena, quick-service and fast-casual industries, as well as foodservice training and management, shared how metrics are a key driver to any successful foodservice operation �" a concept the NACS CAFÉ program devotes significant attention.

Touching upon her hospitality background, she shared how that industry came together to create a consistent approach to accounting and financial terminology, which in convenience stores is far less consistent and therefore makes data collection and analysis more difficult.

Caldarola added that good management of a convenience store foodservice program comes from watching your systems �" consistently and accurately. Foodservice adds a layer of complexity to c-store operations because every item has a price, including the packaging. By establishing fiscal procedures, retailers can determine how to forecast their daypart menu items, reduce waste, keep track of inventory and manage their menu product costs.

A common misperception in a foodservice operation is the difference between waste and shrink. "Waste is not shrink," stressed Caldarola.

Waste includes:

  • Discarded food
  • Improperly prepared food products
  • Spoiled ingredients or foods
  • Unused leftovers
  • Kitchen 'accidents��
  • Expired grab and go menu products

Shrink includes:

  • Retail revenues lost through errors or failing to keep costs controlled
  • Undercharged, damaged, or stolen goods

Paul Breslin, Adjunct Professor at the Georgia State University School of Hospitality, shared information he teaches as a NACS CAFÉ instructor on managing the financial side of a foodservice operation, such as using a consistent timeframe (i.e., not a calendar month) for establishing foodservice fiscal periods. He suggested these approaches:

  • 13 Four Week Periods in Calendar Year; or,
  • 4 Quarters: 4 - 4 - 5 weeks or 5 - 4 - 4 weeks

In closing, he shared a few key foodservice benchmarks retailers can compare to their own operations:

  • Food Cost (includes paper/plastic): 28% to 40%
  • Wages (all inclusive): 25% to 29%
  • Supplies: 5% to 7%
  • Utilities (gas, electric, water, etc.): 3% to 5%
  • Waste (recorded food discards): 3% to 6%
  • Net Profit: 17% to 27%

Breslin stressed that it is critical to focus on getting accurate food costs and wages as these are the two most important metrics to measuring a profitable foodservice operation.

Share your interest with NACS now if you��re interesting in attending one of two NACS CAFÉ offered this fall in Atlanta:

  • August 21-24, 2011
  • November 6-9, 2011