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10 April 2019

Food costs on the rise

Today The Caterer reported that the CGA and Prestige Purchasing’s Foodservice Price Index (FPI) for March recorded the highest levels of inflation among ingredient prices since the dataset’s creation in 2015.

The FPI found that food prices overall had risen by almost 10% year on year across the month with the highest growth categories including fish and fruit. This is bad news for caterers who are already facing challenges on the high street in particular, with increasing Business Rates, rising employment costs and stagnant demand for many in the current economic environment.

Efficient and effective cost control is important at any time, but when margins are being squeezed it is essential to ensure that, as caterers, we are safeguarding gross profit with appropriate controls on key costs as well as correct pricing strategies based on cost recovery and an understanding of market demand.

Top tips include:

  1. Keep control. Agree prices in advance with nominated food suppliers and use correct ordering procedures with purchase specifications
  2. Standardise. Prepare a standard recipe for every dish sold with every ingredient costed
  3. Communicate. Train staff to use standard recipes ensuring quantities and preset portion sizes are followed
  4. Analyse the data. Monitor the number of ingredients being used and save storage space and cost by using ingredients in more than one dish
  5. Waste not, want not. Design menus to reduce waste so that ingredients can be repurposed and cook to order if possible
  6. Regular updates. Check standard recipes are updated regularly with the latest prices from the supplier
  7. Set targets. Ensure every item on the menu is priced to achieve at least the target gross profit as a percentage or in cash and ensure that all items are listed on the point of sale system
  8. Mix low cost and high cost ingredients. Monitor the sales mix to see which menu items are the most popular and adjust forecast to take account of internal and external factors
  9. Reduce wastage. Calculate the amount of food waste, both from preparation and from plate waste and adapt menus in response. For more wise tips regarding reducing food waste - visit
  10. Just in time. Keep an eye on how much stock you are holding – high stock levels mean less cash is available whilst also using up valuable space in the business. Take stock on a regular basis and monitor transfers.

The key to successful F&B management is to keep monitoring how the business is performing with these key measures included on your dashboard: Average Spends, Sales Mix changes, REVPASH (Revenue per Available Seat Hour) as well as Actual and Theoretical Gross Profit percentages. Keep stock levels monitored with average days held calculations based on the monthly stock take values and focus on slow moving items. Finally, monitor wastage both during production and plate waste.

To learn more about all of the above and how these techniques could help you in your catering business why not join us for a course. Our next course is on the 16th April in Manchester - to book click here.

Alternatively a bespoke course could be really beneficial for your business and help to keep all the members of your kitchen and restaurant teams focused on the prize - producing the best possible food and beverage profit!

For more information email us at