Terms & Definitions from the course
Help!
|
|
||||
|---|---|---|---|---|---|
| Food Costs | All costs associated with the production of menu items. Includes generally juices and hot beverages too.
🗑
|
||||
| Beverage Costs | All costs related to alcoholic and non-alcoholic drinks: Wine, Spirits, Beer, Soft Drinks. Includes costs of ingredients necessary to produce the drinks: fruits, garnishes.
🗑
|
||||
| Labor Costs | Includes all costs for salaries and wages, including taxes and benefits
🗑
|
||||
| Prime Costs | All costs related to the production of menu items, alcoholic and non-alcoholic drinks, salaries and wages together.
🗑
|
||||
| Operating expenses | Includes all expenses incurred other than food, beverages or labor.
🗑
|
||||
| Revenue | Amount of dollars you take in
🗑
|
||||
| Expenses | Costs of the items required to operate the business
🗑
|
||||
| Profit | Amount of dollars that remain after all costs have been paid
🗑
|
||||
| Controllable expenses | Expenses which can be restrained by management to some extent. E.g. direct operating expenses, music & entertainment, marketing, utilities, general & administrative, repair & maintenance.
🗑
|
||||
| Non-Controllable Expenses | Expenses that cannot be unilaterally changed by an individual, department or business.
🗑
|
||||
| Contract foodservice | Commercial, legally binding contract, getting into spaces, for private managed properties
🗑
|
||||
| Contact food service | Subsidized or welfare, cost sector, institutional
🗑
|
||||
| Airport hotels | Practical hotels, without fine-dining
🗑
|
||||
| City center hotels | Hotels with high expectations, high quality
🗑
|
||||
| Convention centers | Very functional hotels, with space, catering, events service, banquets vs. restaurant services. Little waste because the number of seats is known in advance
🗑
|
||||
| Limited service hotels | Budget hotels selling beds and saving money on F&B
🗑
|
||||
| Residential hotels | Hotels for long stays, more focus on rooms than F&B
🗑
|
||||
| Spa hotels | Hotels with health as a priority over F&B
🗑
|
||||
| External analysis | Analysis of the socio-economics trends & demographic changes continuing to affect the food service industry.
🗑
|
||||
| Consumers’ behavior | Defined by “everything now”, the value for money, uniqueness, the needs to be pampered, efficiency, simplicity, butterflying
🗑
|
||||
| Macro environment | Major external & uncontrollable factors that influence an organization’s decision making – political, economic, social, technological, legal, and environmental
🗑
|
||||
| Basic Business Model | Plan that explains the relationship between its parts. 1. Input, 2. Transformation, 3. Output
🗑
|
||||
| Input | First step of the basic business model. Includes energy, manpower, money, equipment, raw products & materials.
🗑
|
||||
| Transformation | Second step of the basic business model. It is relationship between consumed inputs and produced outputs through an organization’s capabilities in applying management and technology.
🗑
|
||||
| Output | Third step of the basic business model. Includes products, services, revenues & profits, productivity & covers.
🗑
|
||||
| Expanded system model | Plan that allows management to see the organization as one entity and as a part of the larger external environment.
🗑
|
||||
| Control process | Direction that compares standards to the actual performance. Acceptable variance = +/- 5%
🗑
|
||||
| 4 management functions | Planning, directing, controlling, organizing
🗑
|
||||
| Fine-dining restaurants | F&B category where labor costs > food costs
🗑
|
||||
| Restaurant chains | F&B category where food costs > labor costs
🗑
|
||||
| Family cafeteria | F&B category where food costs = ~ labor costs
🗑
|
||||
| Income Statement (P&L) | Document with the following outlines: revenues earned from sales, costs incurred from expenses, department’s financial gain
🗑
|
||||
| Uniform System of Accounts | Key tool of comparison with standardized formats
🗑
|
||||
| Forecasting | Predictions and estimations for investors, finance department. Need to know how much money we are expecting and understand where the cash is coming from and how to use it.
🗑
|
||||
| Average forecast | On a fixed period, e.g. 14 days. Estimations that are just averages. Quick method.
🗑
|
||||
| Rolling Forecast | Add/drop process to predict future over a set period of time. It gives a better idea of where the trend is going.
🗑
|
||||
| Future period forecast | Result past period * (1.00 + % increase estimate)
🗑
|
||||
| Payroll | Management of salaries’ costs, wages (hourly) and employee benefit (vacation, sickness)
🗑
|
||||
| Omnes Principles | Five straightforward tools designed to build a menu.
🗑
|
||||
| Price Range (Omnes Principle) | Variance between highest and lowest price within a category not to exceed 2.5 times the pricing of the lowest priced item. It does not apply to wine. Starters should be ~35% of the main courses prices. Desserts should be ~25% of the main courses prices.
🗑
|
||||
| Price Spread (Omnes Principle) | Price variation within menu. # of dishes priced in the middle range = or slightly > total amount of dishes in the lower and in the upper ranges together.
🗑
|
||||
| Supply / Demand Ratio (Omnes Principle) | Balancing sales prices by orientating against average food sales check.x = Average check / Average Menu Price. If x < 0.9, reduce pricing as too expensive. If 0.9 < x < 1, maintain pricing. If x > 1 : slightly increase pricing.
🗑
|
||||
| Promotion of the Set Menu (Omnes Principle) | Not a cheap item, but an item at an attractive price. Selection of items in mid-price range per category: avg. 1st course price + avg. main course price + avg. dessert price
🗑
|
||||
| Consistency of the Menu (Omnes Principle) | Maintain stability between different product categories (appetizers, mains, desserts) by avoiding steep price differences between the categories. Important to maintain brand perception of your restaurant all across your menu.
🗑
|
||||
| Purchasing | Link between internal departments and suppliers. Detached from production and contributes to the quality strategy of a company (supplier evaluations and negotiation). Buying at the right price, right time, right quantity, right quality, right vendor.
🗑
|
||||
| Procurement | Involves the process of selecting vendors, establishing payment terms, strategic checking, selection, the negotiation of contracts & actual purchasing of goods. Essentially, the overarching or umbrella term within which purchasing can be found.
🗑
|
||||
| Intern Suppliers | Farms & Ranches, Primary Processing plants & Production Plants
🗑
|
||||
| Direct Suppliers | Final Processing Facilities, Distribution Centers.
🗑
|
||||
| Direct Distribution (Source of purchase) | Retail sale between producers and restaurateurs
🗑
|
||||
| Wholesales (Source of purchase) | Intermediate between manufacturer/producer and retailer. Bulk Purchase & Bulk Sales.
🗑
|
||||
| Retailer (Source of purchase) | Buy in bulk but sell in small quantities.
🗑
|
||||
| Cash and Carry (Source of purchase) | No product delivery offered.
🗑
|
||||
| Referral Centers (Source of purchase) | Purchases from a single supplier with a product catalog covering all requirements. Contractual agreement with somebody to guarantee lower price.
🗑
|
||||
| Food Receiving Control | Verification of quantities, quality, and price conform to orders placed (clerk)
🗑
|
||||
| Establishing standards for receiving | Quantity delivered = quantity ordered. Quantity listed on invoice/delivery bill. Conformity to standard specification sheet. Pricing on incoice to be conform to those stated on order form.
🗑
|
||||
| Invoice Stamp | Used by receiver to record the data on which goods were received with signatures of individuals verifying the data.
🗑
|
||||
| As Purchased (A.P.) | Gross weight of an item as received upon delivery.
🗑
|
||||
| Edible Portion (E.P.) | Net weight defined as the weight of an item subject to processing and preparation methods in preparation sales.
🗑
|
||||
| Yield percentage (Yield tests) | (Servable weight / original weight) * 100
🗑
|
||||
| Yield Cost (Yield tests) | (Purchase Price / Yield percentage) * 100
🗑
|
||||
| Number of portions (Yield tests) | (Original Quantity * Yield Percentage) / Portion Size
🗑
|
||||
| Butcher Test (wholesale cuts) | Evaluates cost of operations cutting own portions rather than purchasing product pre-portioned. To measure loss from deboning, trimming, and portioning meats, fish, and poultry. Re-evaluate each time pricing changes.
🗑
|
||||
| Pareto’s Law | About 80% of a firm’s sales are generated by about 20% of the items in its inventory.
🗑
|
||||
| ‘A’ class items (Pareto’s Law) | Proteins. 10-20% of the items account for 70-80% of inventory value. Perpetual inventory control system.
🗑
|
||||
| ‘B’ class items (Pareto’s Law) | Fruits & Vegetables. 15-25% of the items account for 10-20% of inventory value. Periodic/routine control system.
🗑
|
||||
| ‘C’ class items (Pareto’s Law) | 65-75% of the items account for 5-10% of inventory value. Simple control. Many businesses carry large levels of safety stock of these items where carrying costs are low.
🗑
|
||||
| BIN Cards | Traditional tool for the control of bulk stock on the cellars and storerooms. One for every item.
🗑
|
||||
| Food available for sale | Sum of beginning inventory and purchase made during a specific accounting period
🗑
|
||||
| Food cost consumed (daily and monthly) | Value of all food used or consumed by an operation: sales, staff meals, spoilage, theft
🗑
|
||||
| Food cost sold (daily and monthly) | Value of all food expenses incurred that have generated a food revenue.
🗑
|
||||
| Potential food cost | Theoretical cost if all recipes were perfectly respected.
🗑
|
||||
| Beginning inventory | Value of all food on hand at beginning of the accounting period – determined by a physical inventory.
🗑
|
||||
| Purchases | Sum of all food bought (direct + stores) during the accounting period. The amount is determined by adding and properly summing up the value of all delivery invoices and other bills for products purchased in the accounting period.
🗑
|
||||
| Ending inventory | Refers to the dollar value of all food on hand at the end of the accounting period – determined by completing an accurate physical inventory.
🗑
|
||||
| Menu engineering | Analysis of the food sales to achieve optimum profit.
🗑
|
||||
| Dogs (Menu engineering) | Items with contribution margin lower than the average and popularity lower than the average.
🗑
|
||||
| Plough horses (Menu engineering) | Items with contribution margin lower than the average and popularity higher than the average.
🗑
|
||||
| Stars (Menu engineering) | Items with contribution margin higher than the average and popularity higher than the average.
🗑
|
||||
| Puzzles (Menu engineering) | Items with contribution margin higher than the average and popularity lower than the average.
🗑
|
Review the information in the table. When you are ready to quiz yourself you can hide individual columns or the entire table. Then you can click on the empty cells to reveal the answer. Try to recall what will be displayed before clicking the empty cell.
To hide a column, click on the column name.
To hide the entire table, click on the "Hide All" button.
You may also shuffle the rows of the table by clicking on the "Shuffle" button.
Or sort by any of the columns using the down arrow next to any column heading.
If you know all the data on any row, you can temporarily remove it by tapping the trash can to the right of the row.
To hide a column, click on the column name.
To hide the entire table, click on the "Hide All" button.
You may also shuffle the rows of the table by clicking on the "Shuffle" button.
Or sort by any of the columns using the down arrow next to any column heading.
If you know all the data on any row, you can temporarily remove it by tapping the trash can to the right of the row.
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
Created by:
IsabCamp
Popular Management sets