Cost Control Lesson 2

The Food Flow Process

The Food Flow Process

The food flow process consists of 7 different stages. During each stage, food costs must be controlled in order to ensure a successful food service operation. The 7 different stages of the food flow process include:

1) Purchasing

2) Receiving

3) Storing

4) Issuing

5) Preparation

6) Cooking (Production)

7) Service (sale)

The 7 Stages Broken Down:

1) Purchasing

Prior to ordering, receiving, and storing products, it is important to where the products you need were produced and grown. When seeking potential suppliers, it is important to choose a supplier who is known to be responsible, ethical, reliable, and financially stable. Following these procedures can ensure the legitimate purchasing of items for a correct price that is not too high.

2) Receiving

Once the purchase has been made, the next step is to receive the item in the safest, and most efficient and effective way possible. Following well-designed receiving procedures can help ensure a safe delivery of products, as well as guarantee that the product will meet the established standards for the quality and quantity. Properly receiving items is very important when controlling costs, because a food service operation always needs the quality foods they purchase on time in order to produce food on time.

3) Storing

When food service operations are preparing to store items, it is important that they follow procedures that are in place. Items in storage should be monitored daily in order to preserve the quality of each item. Some foods may come with manufacturer's guidelines for storing, which should always be followed. Items should always be stored with proper labels, following the FIFO system. Not only should the items in storage be checked regularly, but the storage area itself should also be checked regularly so that it stays clean and sanitized. If these guidelines are not followed, it is possible that foods may not be stored properly, which could lead to items going bad, and in turn can cost the food service operation valuable money.

4) Issuing

Food cost is the actual dollar value of food used by an operation during a certain period. The formula for obtaining Food Cost:


(Opening inventory + Purchases = Total Food Available) – Closing inventory = Total Food cost


Total food cost percentage is the relationship between sales and the cost of food to achieve those sales.

The formula for obtaining Total Food Cost Percentage:


Total food cost / Sales = Food cost percentage


Being aware of these terms and pricing food correctly can control cost by preventing under pricing of items, which could cost a food service operation valuable money.

5) Preparation

Standard portion sizes, standardized recipes, and standard portion costs are all preparation standards. Some tools that can be used to ensure proper portion sizes include scoops, ladles, serving spoons, ramekins, and portion scales. Standardized recipes are used by most operations and are followed every time a meal is prepared. A standard portion cost is the exact amount that one serving, or portion, of a food item should cost when prepared according to the standardized recipe. Following each of these standards can ensure the right amount of portion per plate, which in turn would prevent wasting any food, and will control costs immensely.

6) Cooking (Production)

When restaurants produce too much, food costs go up, and vice versa. A food production chart shows how much product should be made in the kitchen during a given meal period. Following this type of chart can help guarantee product quality, as well as help minimize product shortages and possible waste, spoilage, theft, and administrative costs.

7) Service (Sale)

The menu is the primary sales tool in most restaurants. There are a number of tools for menu pricing which include:

1) Contribution Margin - the portion of dollars that a particular menu item contributes to overall profits.

2) Straight Markup Pricing Method - Multiply raw food costs by a predetermined fraction.

3) Average Check Method - the total revenue is divided by the number of seats, average seat turnover, and days open in the year.

4) Food Cost Percentage - equal to the food cost divided by the food sales.