Restaurant Cost Control Strategies

This assignment focuses on understanding the critical aspect of cost control in the restaurant industry. Students are required to conduct research on various cost control methods employed by restaurants. An interview with a professional from a restaurant is also part of the assignment, using a set of prepared questions to delve into their specific practices for managing front-of-house and back-of-house costs. The assignment provides references for further research and includes a structured interview guide.

Food & Beverage Management 1
FOOD AND BEVERAGE MANAGEMENT
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Food & Beverage Management 2
Food and Beverage Management
In the restaurant community, the phrases Front of House and Back of House are
usually utilized to differentiate between dissimilar areas within a restaurant. Front of house
(FOH) operations consist of operations that are carried out in the area in which the guests or
customers sit. FOH is the area that patrons would be exposed to as they stay at the restaurant
(Theng 2012, p. 136). On the other hand, back of house (BOH) operations are all the
operations that are carried out in the behind-the-scene areas not seen by clients (Lewis 2008,
p. 13). This investigative report highlights the findings of the interview with Food and
Beverage Manager of Café Piatto restaurant which is situated in Adelaide, Australia along
264 Rundle Street. It is an Italian restaurant that offers café as well as Italian cuisine. FOH
areas at Café Piatto include waiting area, restrooms, entry, outdoor seating, dining room, and
bar. BOH areas include the office, employee area, and kitchen.
Analysis of the Interview Findings
The interview contained a mix of both closed-ended and open-ended questions. The
person interviewed is the restaurant’s Food and Beverage Manager called Paolo Paolini. He
takes a number of measures to maintain cost control there. In particular, the findings revealed
that to maintain cost control of Front of House Operations, this manager avoids menu price
increases and asks chefs to interact with servers to tell them the menu items that have to be
pushed. In addition, he also advises his chefs to control portion sizes and not to put on the
plate more food than required or than ordered by the patron. This helps to meet food cost
targets.
To maintain cost control of the Back of House Operations, the Food and Beverage
Manager orders wisely and correctly. This entails knowing what is needed and how much. He
also orders food and beverages in bulk for particular items and asks for those shipments to be
sent to his restaurant in installments; not all of them sent at once. This way, he is able to get

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extras such as extra specialty pastas, sea salt, San Marzano tomatoes, and virgin olive oil.
This manager also purchases the restaurant’s foods and beverages directly from the source,
for instance straight from the fish auction or from the farm, and thus avoids middlemen.
When he buys from the source, he also asks for discount. Furthermore, the Food and
Beverage Manager maintains cost control by reducing waste and has trained back office
staffs on his rules as regards not wasting food. Furthermore, the findings indicated that he
uses a few financial control methods in the restaurant’s daily business operation. He
specifically uses financial accounting software and point-of-sale (POS) registers, and
software which integrate these two; as well as financial statement review.
Evaluation of the Findings and its Effectiveness in Managing Foodservice Operations
The restaurant’s Food and Beverage Manager has adopted highly effective methods of
maintaining cost control for both Back of House and Front of House Operations. Controlling
portion sizes for the restaurant’s patrons is a notable way of maintaining Front of House cost
control (Luo & Stark 2015, p. 26). Training staffs to know that every portion of salmon fillet
that goes on the plate is 4 ounces and not any more or that 2 ounces, not 2½ or 3, of duck
prosciutto is put on the plate, makes a significant difference to meet a food cost target
(McDougall & Rose 2010). Equally important, avoiding increasing the prices of menu food
and beverage items ensures that patrons do not feel uncomfortable coming to the restaurant.
All in all, keeping prices low but charging enough to make sufficient profits helps to ensure
that the food items go quickly and decreases overall food costs (Durocher 2013, p. 102).
Moreover, selling food and beverage products that sell fast to the guests helps to maintain
cost control and decrease inventory (Gregorash 2016, p. 336). Since the Food and Beverage
Manager of Café Piatto adopted these measures to maintain cost control, it means that he is
effectively managing foodservice operations of Front of House Operations.

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Purchasing directly from the source and buying non-perishable food products in bulk
are common methods of controlling costs. Porter (2014, p. 55) mentioned that ordering food
products in bulk is very cost-effective. Even so, this could bring about spoiling of food which
in turn cancels out any money that would have been saved through purchasing the food in
bulk. When the shipments are sent to the restaurant in a number of installments, it ensures
that the restaurant serves foods and drinks that are always fresh (Porter 2014, p. 55). This also
decreases the quantity of food that is wasted, and consequently saves the restaurant money
(Duncan 2010, p. 172).
When buying food and drinks such milk, Theng (2012, p. 134) pointed out that there
is always the alternative of cutting out the middlemen and going straight to the source such as
farmers markets and local farms. Usually, middlemen buy from these local sources at a lower
price and then resell them to restaurants at a much higher price for a profit. By bypassing
middlemen, restaurants can save a significant amount of money (Theng 2012, p. 135).
Therefore, the fact that the restaurant at Café Piatto buys directly from the source and buys in
bulk implies that he is actually saving the restaurant a lot of money every month. This is a
great way of maintaining cost control.
Reducing wastage of food and beverage is also an important method of maintaining
cost control. This is particularly critical for restaurants that specialize in highly perishable and
high-cost items (Finch 2010, p. 23). It is vital for cooks to clearly understand the value of
using each piece of a food product. In addition, they have to be creative with the scraps. In
the long-term, reducing waste could lead to huge amount of cost savings (Gregorash 2016, p.
335). Since the manager of Café Piatto strives to decrease waste as a method of maintaining
cost control, it denotes that he is effective in managing foodservice operations.
As a financial control method, financial statement review basically entails sufficient
review of both the balance sheet and the income statement. Restaurant managers need to

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analyze, review and reconcile every account to the general ledger monthly and annually (El
Biri 2015). Financial controls in restaurants also usually employ technology, for instance
financial accounting software and POS registers, and specific software which integrate the
two. It is of note that integrated systems could be programmed to run various financial
reports, signal the restaurant manager whenever cash drawers necessitate a drop, and perform
real-time inventory management (Lohrey 2016). A Point-of-Sale system provides a more
foolproof credit card and cash tracking system that makes it harder for staff members to
commit acts like voiding an already-recorded transaction or lifting money from the cash
registers (Lohrey 2016). The fact that the Food and Beverage Manager at Café Piatto uses
these financial control methods implies that he has adopted effective ways in managing
foodservice operations.
Appendices
Appendix 1: The Interview Script
Reference List
Interview Questions
1. What role do you play at Café Piatto restaurant?
□ Food and Beverage Manager □ Executive Chef □ Other
2. Do you take any measures aimed at controlling costs at the restaurant?
□ Yes □ No
3. What measures do you take to maintain cost control of the Front of House
Operations?
4. How effective have these measures been in keeping costs low?
□ Very Effective □ Effective □ Unsure □ Ineffective □ Very Ineffective
5. What measures do you take to maintain cost control of the Back of House
Operations?
6. How effective have these measures been in keeping costs low?
□ Very Effective □ Effective □ Unsure □ Ineffective □ Very Ineffective
7. Do you use any financial control methods in daily business operation of the
restaurant?
□ Yes □ No
8. If yes, which ones?

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Reference List
Duncan, R 2010, 'Fish farms, restaurants, hotels and libraries', Aplis, 23, 4, pp. 170-178,
Professional Development Collection, EBSCOhost, viewed 1 October 2017.
Durocher, JF 2013, 'Profitable Food and Beverage Management (Book)', Cornell Hotel &
Restaurant Administration Quarterly, 20, 2, p. 102, Business Source Complete,
EBSCOhost, viewed 1 October 2017.
El Biri, G 2015, Internal controls for restaurants. Viewed 30 September, <
https://www.bdo.com/blogs/restaurants/september-2015/internal-controls-for-
restaurants>
Finch, B 2010, Effective Financial Management, London: Kogan Page, eBook Collection
(EBSCOhost), EBSCOhost, viewed 1 October 2017.
Gregorash, B 2016, 'Restaurant revenue management: apply reservation management?',
Information Technology & Tourism, 16, 4, pp. 331-346, Hospitality & Tourism
Complete, EBSCOhost, viewed 1 October 2017.
Lohrey, J 2016, Internal control in restaurants. Viewed 30 September <
http://smallbusiness.chron.com/internal-control-restaurants-74765.html>
Lewis, M 2008, 'A bigger profile for front of house', Caterer & Hotelkeeper, 12 June,
Business Source Complete, EBSCOhost, viewed 1 October 2017.
Luo, T, & Stark, P 2015, 'Nine out of 10 restaurants fail? Check, please', Significance, 12, 2,
pp. 25-29, Academic Search Premier, EBSCOhost, viewed 1 October 2017.

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McDougall, A & Rose, T 2010, Tips and Tools for Controlling your Food Cost. Viewed 30
September 2017, < http://www.starchefs.com/cook/business-tips/controlling-
restaurant-food-cost>
Porter, J 2014, 'Cost control', Caterer & Hotelkeeper, 203, 4814, pp. 54-56, Business Source
Complete, EBSCOhost, viewed 1 October 2017.
Romm, D 2010, 'Food and Beverage Management in Hotels (Book)', Cornell Hotel &
Restaurant Administration Quarterly, 29, 2, p. 109, Business Source Complete,
EBSCOhost, viewed 1 October 2017.
Theng, LP 2012, 'Food and beverage management for the hospitality, tourism and event
industries', Anatolia: An International Journal Of Tourism & Hospitality Research,
23, 1, pp. 135-136, Hospitality & Tourism Complete, EBSCOhost, viewed 1 October
2017.