Restaurant Operations

Learning Outcomes

After reading and studying this chapter, you should be able to:

• Identify key aspects of a restaurant manager’s job.

• Describe restaurant operations for the front of the house.

• Outline back-of-the-house operations.

• Calculate basic food, beverage, and labor cost percentages.

Restaurant

Operations

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5. Evaluate progress of employees during training.

6. Supervise on-site training of employees that is conducted

by another manager, employee leader, trainer, and so on.

7. Conduct payroll signup.

8. Complete reports or other written documentation on

successful completion of training by employees.

Scheduling for Shifts

1. Review employee work schedule for shift.

2. Determine staffing needs for each shift.

3. Make work assignments for dining room, kitchen staff,

and maintenance person(s).

4. Make changes to employee work schedule.

5. Assign employees to work stations to optimize employee

effectiveness.

6. Call in, reassign, or send home employees in reaction to

sales and other needs.

7. Approve requests for schedule changes, vacation, days

off, and so on.

Supervision and Employee

Development

1. Observe employees and give immediate feedback on

unsatisfactory employee performance.

2. Observe employees and give immediate feedback on

satisfactory employee performance.

3. Discuss unsatisfactory performance with an employee.

4. Develop and deliver incentive for above-satisfactory

performance of employees.

5. Observe employee behavior for compliance with safety

and security.

6. Counsel employees on work-related problems.

7. Counsel employees on nonwork-related problems.

8. Talk with employees who have frequent absences.

9. Observe employees to ensure compliance with fair labor

standards and equal opportunity guidelines.

10. Discipline employees by issuing oral and/or written

warnings for poor performance.

11. Conduct employee and staff meetings.

12. Identify and develop candidates for management programs.

13. Put results of observation of employee performance in

writing.

14. Develop action plans for employees to help them in their

performance.

15. Authorize promotion and/or wage increases for staff.

16. Terminate employment of an employee for unsatisfactory

performance.

The job of restaurant general manager or managing partner, if they

own a stake in the business, is very challenging and demanding,

and requires strong leadership and organizational skills. First, let

us analyze the job by examining the key areas of the job.

Restaurant Manager

Job Analysis

Learning Outcome 1: Identify key aspects of a restaurant

manager’s job.

The National Restaurant Association (NRA), the largest industry

association, which represents over 500,000 restaurant busi-

nesses, has formulated an analysis of the foodservice manager’s

job by functional areas and tasks. This analysis follows a natural

sequence of functional areas from human resources to sanitation

and safety.

Human Resource Management

Recruiting/Training

1. Recruit new employees by seeking referrals.

2. Recruit new employees by advertising.

3. Recruit new employees by seeking help from district

manager/supervisor.

4. Interview applicants for employment.

Orientation/Training

1. Conduct on-site orientation for new employees.

2. Explain employee benefits and compensation programs.

3. Plan training programs for employees.

4. Conduct on-site training for employees.

The job of restaurant general manager requires strong leader-

ship and organizational skills.

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Marketing Management

1. Create and execute local establishment marketing

activities.

2. Develop opportunities for the establishment to provide

community services.

3. Carry out special product promotions.

Operations Management

Facility Maintenance

1. Conduct routine maintenance checks on facility and

equipment.

2. Direct routine maintenance checks on facility and

equipment.

3. Repair or supervise the repair of equipment.

4. Review establishment evaluations with district manager/

supervisor.

5. Authorize the repair of equipment by outside contractor.

6. Recommend upgrades in facility and equipment.

Food and Beverage Operations

Management

1. Direct activities for opening establishment.

2. Direct activities for closing establishment.

3. Talk with other managers at beginning and end of shift to

relay information about ongoing problems and activities.

4. Count, verify, and report inventory.

5. Receive, inspect, and verify vendor deliveries.

6. Check stock levels and submit orders as necessary.

7. Talk with vendors concerning quality of product delivered.

8. Interview vendors who wish to sell products to

establishment.

9. Check finished product quality and act to correct

problems.

10. Work as expediter to get meals served effectively.

11. Inspect dining area, kitchen, rest rooms, food lockers,

storage, and parking lot.

Financial Management

Accounting

1. Authorize payment on vendor invoices.

2. Verify payroll.

3. Count cash drawers.

4. Prepare bank deposits.

5. Assist in establishment of audits by management or

outside auditors.

6. Balance cash at end of shift.

7. Analyze profit and loss reports for establishment.

Cost Control

1. Discuss factors that impact profitability with district

manager/supervisor.

2. Check establishment figures for sales, labor costs, waste,

inventory, and so on.

Administrative Management

Scheduling/Coordinating

1. Establish objectives for shift based on needs of

establishment.

2. Coordinate work performed by different shifts, for exam-

ple, cleanup, routine maintenance, and so on.

3. Complete special projects assigned by district manager/

supervisor.

4. Complete shift readiness checklist.

Planning

1. Develop and implement action plans to meet financial

goals.

2. Attend off-site workshops and training sessions.

Communication

1. Communicate with management team by reading and

making entries in daily communication log.

2. Prepare written reports on cleanliness, food quality, person-

nel, inventory, sales, food waste, labor costs, and so on.

3. Review reports prepared by other establishment

managers.

4. Review memos, reports, and letters from company head-

quarters/main office.

5. Inform district manager/supervisor of problems or devel-

opments that affect operation and performance of the

establishment.

6. Initiate and answer correspondence with company, ven-

dors, and so on.

7. File correspondence, reports, personnel records, and so on.

“

Ray Kroc, of McDonald’s, once spent a

couple of hours in a good suit with one of his

restaurant managers cleaning up the park-

ing lot of one of his restaurants. Word soon

got around to the other stores that manage-

ment begins in the parking lot and ends in the

bathrooms.

”

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CHAPTER 7 Restaurant Operations

12. Check daily reports for indications of internal theft.

13. Instruct employees regarding the control of waste, portion

sizes, and so on.

14. Prepare forecast for daily or shift food preparation.

Service

1. Receive and record table reservations.

2. Greet familiar customers by name.

3. Seat customers.

4. Talk with customers while they are dining.

5. Monitor service times and procedures in the dining area.

6. Observe customers being served in order to correct

problems.

7. Ask customers about quality of service.

8. Ask customers about quality of the food product.

9. Listen to and resolve customer complaints.

10. Authorize complementary meals or beverages.

11. Write letters in response to customer complaints.

12. Telephone customers in response to customer complaints.

13. Secure and return items left by customers.

Sanitation and Safety

1. Accompany local officials on health inspections on

premises.

2. Administer first aid to employees and customers.

3. Submit accident, incident, and OSHA reports.

4. Report incidents to police.

5. Observe employee behavior and establishment

conditions for compliance with safety and security

procedures.

This comprehensive analysis of a restaurant manager’s job

details all the major areas that a restaurant manager will deal

with. Depending on the type of restaurant, more emphasis

may be placed on one area over another – and that may

change from day to day. Next, we review the job of an assis-

tant restaurant manager. Most restaurants go with an open-

ing and closing manager. In either case, they perform much

the same basic duties plus any special opening or closing

requirements.

An assistant restaurant manager does some of the duties of

a restaurant manager, and generally there is both an opening

manager and a closing manager.

Restaurants are traditionally organized by front and back

of the house. The front of the house comprises the servers,

bussers, wine stewards, bartenders, and cocktail servers,

while the back of the house includes the chef and kitchen

cooks, dishwashers, stewards, dishwashers, receivers, and

storekeepers.

Check Your Knowledge

1. Name ways that new employees are recruited.

2. Explain key tasks of administrative management.

3. Explain key tasks of operations management.

Front of the House

Learning Outcome 2: Describe restaurant operations for the

front of the house.

Restaurant operations are generally divided between what is

commonly called front of the house and back of the house.

The front of the house includes anyone with guest contact,

from the hostess to the bus person. The sample organization

chart in Figure 7–1 shows the differences between the front and

back of the house areas.

The general manager or restaurant manager runs the restau-

rant. Depending on the size and sales volume of the restaurant,

there may be more managers with special responsibilities, such as

kitchen manager, bar manager, and dining room manager. These

managers are usually cross-trained in order to relieve each other.

In the front of the house, restaurant operation begins with

creating and maintaining what is called curbside appeal, or

keeping the restaurant looking attractive and welcoming. Ray

Kroc, of McDonald’s, once spent a couple of hours in a good

suit with one of his restaurant managers cleaning up the parking

lot of one of his restaurants. Word soon got around to the other

stores that management begins in the parking lot and ends in

FIGURE 7–1 Restaurant Organization Chart.

General Manager

Kitchen Manager

Back of the House

Cooks

Prep cooks

Expediter

Receiving

Dishwashing

Bar Manager Dining Room Manager

Front of the House

Opening and Closing Managers

Bar-backs

Bartenders

Cocktail servers

Hostess

Buspersons

Servers

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Front of the House

133

“

Working together is the key to success in

the restaurant business.

”Bruce Folkins, Marina Jacks,

Sarasota, FL

The front of the house includes anyone with guest contact, from

the hostess to the bus person.

This is known as suggestive selling. The server then takes

the entree orders. Often, when taking orders, the server begins

at a designated point and takes the orders clockwise from that

point. In this way, the server will automatically know which per-

son is having a particular dish. When the entrees are ready,

the server brings them to the table. He or she checks a few

minutes later to see if everything is to the guests’ liking and

perhaps asks if they would like another beverage. Good serv-

ers are also encouraged, when possible, to pre-bus tables.

“

Management involvement is vital to the

success of a restaurant.

”

Bussers and servers may clear the entree plates, while serv-

ers suggestively sell desserts by describing, recommending, or

showing the desserts. Coffee and after-dinner cocktails are also

offered. Suggestions for steps to take in table service include

the following:

• Greet the guests.

• Introduce and suggestively sell beverages.

• Suggest appetizers.

• Take orders.

• Check to see that everything is to the guests’ liking

within two bites of the entrees.

• Ask if the guests would like another drink.

• Bring out dessert tray and suggest after-dinner drinks

and coffee.

In addition to the seven steps of the table service, servers are

expected to be NCO—(neat, clean, and organized)—and to help

ensure that hot food is served hot, and cold food is served cold.

For example, during the lunch hour, servers may be sched-

uled to start at 11:00

a.m. The opening group of two or three

people is joined by the closing group of the same number at

around 11:45

p.m. If the restaurant is quiet, servers may be

phased out early. When the closing group comes in, there is

a quick shift meeting, line up, or “alley rally.” This provides an

opportunity to review recent sales figures, discuss any promo-

tions, and acknowledge any items that are “86'ed”—the res-

taurant term for a menu item that is not available. Recognition

is also given to the servers during the meetings, serving as

morale boosters.

Restaurant Forecasting

Most businesses, including restaurants, operate by formulating

a budget that projects sales and costs for a year on a weekly

and monthly basis. Financial viability is predicted on sales, and

sales budgets are forecasts of expected business.

Forecasting restaurant sales has two components: guest

counts or covers and the average guest check. Guest

counts or covers are the number of guests patronizing the res-

taurant over a given time period—a week, month, or year. To

forecast the number of guests for a year, the year is divided into

the bathrooms. Most restaurant chains have checklists that

each manager uses. In the front of the house, the parking lot,

including the flower gardens, needs to be maintained in good

order. As guests approach the restaurant, greeters may hold

the door open and welcome them to the restaurant. At the 15th

Street Fisheries Restaurant in Ft. Lauderdale, greeters welcome

the guests by assuring them that “we’re glad you’re here!”

Once inside, the greeter, or as some restaurants call them, a

“smiling people greeter” (SPG), greets guests appropriately

and, if seating is available, escorts them to a table. If there is a

wait, the hostess will take the guests’ names and ask for their

table preference.

Aside from greeting the guests, one critical function of the host-

ess is to rotate arriving guests among the sections or stations.

This ensures an even and timely distribution of guests—otherwise

one section may get overloaded. Guests are sometimes asked to

wait a few minutes even if tables are available. This is done to help

manage the kitchen’s workload—because most kitchens have

limited space and cannot cope with too much volume at one time.

The greeters maintain a book, or chart, showing the sections

and tables so they know which tables are occupied. Greeters

escort guests to the tables, present menus, and may explain

special sales promotions. Some may also remove excess place

settings from the table.

In some restaurants, servers are allocated a certain number

of tables, which may vary depending on the size of the tables

and the volume of the restaurant. Normally, five is the maxi-

mum. In other restaurants, servers rotate within their section to

cover three or four tables.

Servers introduce themselves and offer a variety of bever-

ages and/or specials, or invite guests to select from the menu.

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Forecasting restaurant sales has two components: guest counts

or covers and the average guest check.

twelve 28- and one 29-day accounting periods. The accounting

periods then are broken down into four 7-day weeks. Restaurant

forecasting is done by taking into consideration meal period, day

of week, special holidays, and previous forecast materializations.

In terms of number of guests, Mondays usually are quiet;

business gradually builds to Friday, which is often the busiest

day. Friday, Saturday, and Sunday frequently provide up to

50percent of revenue. This, however, can vary according to

type of restaurant and its location.

The average guest check is calculated by dividing total sales

by the number of guests. Most restaurants keep such figures

for each meal. The number of guests forecast for each day is

multiplied by the amount of the average food and beverage

check for each meal to calculate the total forecast sales. Each

day, actual totals are compared with the forecasts. Four weekly

forecasts are combined to form one accounting period; the

13accounting periods, when totaled, become the annual total.

Restaurant forecasting is used not only to calculate sales

projections but also to predict staffing levels and labor cost per-

centages. Much depends on the accuracy of forecasting. Once

sales figures are determined, all expenditures, fixed and vari-

able, must be deducted to calculate profit or loss.

Point of Sale and Software Systems

There are several Point of Sale Systems (POS) available for res-

taurants. Some are for large restaurants and chains like fran-

chises, while others are better suited for smaller independent

restaurants and cafés. For example, Shopkeep is a cloud-based

POS system for iPads that can tailor menus, monitor inven-

tory, manage employees, market to guests, and analyze data,

whereas Square is good for quick-service restaurants or cafés.

It can come with a square stand that transforms an iPad into a

simple cash register. NCR, a long-standing provider of POS, has

a cloud-based POS system, as do several other companies.

Open Table (OT) manages walk-ins, waitlists, and reserva-

tions. This allows operators to communicate with guests before

and after their visit (you may receive a questionnaire) or birth-

day wishes. Open Table is mostly used by upscale full-service

restaurants and it costs them $2.50 per cover (or guest). One

advantage of Open Table is that guests can make reservations,

even when the restaurant is closed, at just $0.25 per cover. OT

stores useful guest information, such as seating preferences,

VIP’s, dietary restrictions, and special events. OT also enables

smarter table management with floor plans to pre-assign tables,

monitor table status, and assign server sections.

Next Table is a cloud-based reservation and table man-

agement system for an iPad. It can manage not only table

reservations, but also restaurant operations. Oracle is also a

cloud-based reservation system that enables guests to see

time and availability and request reservations from a restau-

rant’s Web site. Guests can see current availability and next

table reservation times. No Wait is an on-demand mobile app

that helps bring guests into a restaurant and aids in their seat-

ing. Then there is the free Table Agent restaurant reservation

system app in Cloud that offers restaurants alternatives to paid

systems. Other systems include Dine Time, Cake, and Quora,

which even texts guests when their table is ready, so they can

relax at the bar or wherever. Going one step further, some fast-

casual restaurants, among them Starbucks, Panera Bread,

Subway, and Domino’s Pizza, have turned to order-ahead apps

to extract higher sales and give guests a convenience.

Service

A discussion about restaurant service in America necessarily

includes the topic of a $15 per hour minimum wage. This topic

naturally has people on both sides of the issue. Restaurateurs

like Danny Meyer have begun paying employees $15 per hour

and increased menu prices to compensate. Moo Cluck Moo

Great service adds tremendous value to the dining experience.

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seat. A gueridon is a trolley-like table with a gas burner for

tableside cooking. This is the most impressive and expen-

sive form of service. Due to the higher cost of training and

employing servers who can do French service, and given

that sometimes the food is cold by the time the guest gets

to eat, this form of service is rarely used today except in

very formal service situations.

Russian Service: The food is cooked in the kitchen, cut,

placed onto a serving dish, and beautifully garnished. The

dish is then presented to the guests and served individu-

ally by lifting the food onto the guest’s plate with a serving

spoon and fork. Russian service can be used at a formal

restaurant where the servers use white gloves. Russian and

French service share the same challenges: to get the food

to the guests quickly so it is still hot, and to keep it priced

reasonably. Russian service also is used only at very formal

restaurants; it also costs much more than American service.

At Posterio, in Las Vegas, servers are invited to attend a

one-and-a-half-hour wine class in the restaurant; about three-

quarters of the 40-member staff routinely benefit from this

additional training. The best employees are also rewarded

with monthly, semi-annual, and/or annual prizes, which could

be $100 cash, a limousine ride, dinner at Posterio, a night’s

lodging at the Prescott Hotel, or a week in Hawaii. Servers at

some San Francisco restaurants role-play the various elements

of service such as greeting and seating guests, suggestive sell-

ing, correct methods of service, and guest relations to ensure a

positive dining experience. A good food server in a top restau-

rant in many cities can earn about $50,000 a year.

Good servers quickly learn to gauge guests’ satisfaction lev-

els and needs; they check to ensure guests have everything

they need as their entree is placed before them. Even better,

they anticipate guests’ needs. For example, if the guest has

used the entree knife to eat the appetizer, then a clean one

should automatically be placed to the guest’s right side. In

other words, the guest should not receive the entree and then

realize that he or she needs another knife.

Another example of good service is when the server does

not have to ask everyone at the table who is eating what. The

server should either remember or make a seating plan so that

the correct dishes are automatically placed in front of guests.

Danny Meyer, owner of New York City’s celebrated Union

Square Café and recipient of 25 James Beard awards and

4Michelin Stars, plus 16 years on the Zagat most popular restau-

rants list and Outstanding Service Awards from the James Beard

Foundation, gives each of the restaurant’s 95employees—from

bus person to chef—a $600 annual allowance ($50each a month)

to eat in the restaurant and critique the experience.

This is a very

smart move because any comments or observations come from

peers and not from Danny. His “enlightened hospitality” is based

upon the belief that putting your own employees first is key to run-

ning a meaningful and sustainable business. Danny’s 14 restau-

rants range from the celebrated Union Square Café, to Gramercy

Tavern, The Modern, Blue Smoke, North End Grill, Marta, and

is a quick service burger joint that is paying $15 per hour and

making a profit. They do it with employees who multitask – one

person is not just flipping burgers; they also bake buns, make

sauces, and prepare made-to-order grass-fed burgers and free-

range chicken sandwiches.

One advantage is that employees

are more engaged in their work and that people don’t leave,

which means that training is not a constant issue. Several res-

taurants, McDonald’s among them, have introduced touch-

screen self-service kiosks. Many other chains, both quick and

full service, have engaged tablets as a solution for rising labor

costs that won’t adversely impact the guest service experience.

More than ever, what American diners really want to order

when eating out is good service. All too often, this is not on the

menu. With increased competition, however, bad service will

not be tolerated in American restaurants. Great service adds

tremendous value to the dining experience; something most

guests are willing to pay for.

American service is a method in which the food is

prepared and decoratively placed onto plates in the kitchen,

carried into the dining room, and served to guests. American

service isa less formal—yet professional—approach preferred

by today’s restaurant guests. The restaurants’ commitment

to service is evidenced by the fact that most have increased

training for new employees. Servers are not merely order tak-

ers; they are the salespeople of the restaurant. A server who

is undereducated about the menu can seriously hurt business.

Restaurants in the United States and Canada, and in many

other parts of the world, all use American service.

Other types of service used less often in the United States

include the following:

French Service: This service is used in very formal res-

taurants where the food is attractively arranged on platters

in the kitchen and brought to the table by servers and

presented to guests, after which the preparation of the

food is completed on a gueridon table beside the guest’s

American service is a method in which the food is prepared and

decoratively placed onto plates in the kitchen, carried into the

dining room, and served to guests.

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Shake Shack. Danny also makes time to give backto the com-

munity by being a national figure in the fight against hunger.

At the critically acclaimed Inn at Little Washington in Washington,

Virginia, servers are required to gauge the mood of every table

and jot a number (1 to 10) and sometimes a description (“elated,

grumpy, or edgy”) on each ticket. Anything below a seven requires

a diagnosis. Servers and kitchen staff work together to try to elevate

the number to at least a nine by the time dessert is ordered. Given

the likelihood of increased labor and health costs, more restaurants

will probably opt for a service style similar to Chipotle or Pie Wei.

Suggestive Selling

Suggestive selling can be a potent weapon in the effort to increase

food and beverage sales. Many restaurateurs cannot think of a

better, more effective, and easier way to boost profit margins. Most

guests are not offended or uncomfortable with suggestive selling

techniques, provided servers are properly trained not to overdo

it! In fact, guests may feel special that the server is in tune with

their needs and desires. It may be that the server suggests some-

thing to the guest that he or she has never considered before.

The object here is to turn servers into sellers. Guests will almost

certainly be receptive to suggestions from competent servers.

On a hot day, for example, servers can suggest frozen mar-

garitas or daiquiris before going on to describe the drink spe-

cials. Likewise, servers who suggest a bottle of fumé blanc to

complement a fish dish, or a pinot noir or cabernet sauvignon

to go with red meat, are likely to increase their restaurant’s bev-

erage sales. Upselling takes place when a guest orders a vodka

and tonic, asking for a lower-priced “well” vodka, and the server

tries to “sell” the guest on a higher-priced vodka like Stoli, Ketel

One, or Grey Goose in their vodka and tonic.

Check Your Knowledge

1. Define curbside appeal.

2. Explain the suggestion for steps to take in table

service.

3. Explain the purpose of forecasting.

For a restaurant to be successful, there must be clear lines

of communication between the front and back of the house.

Back of the House

Learning Outcome 3: Outline back-of-the-house operations.

The back of the house is generally run by the kitchen man-

ager and the term refers to all the areas with which guests do

not normally come in contact. This includes purchasing, receiv-

ing, storing/issuing, food production, stewarding, budgeting,

accounting, and control.

One of the most important aspects to running a success-

ful restaurant is having a strong back-of-the-house operation,

particularly in the kitchen. The kitchen is the backbone of every

full-service restaurant, so it must be well managed and orga-

nized. Some of the main considerations in efficiently operating

the back of the house include staffing, scheduling, training,

food cost analysis (internal controls), production, management

involvement, management follow-up, and employee recognition.

Food Production

Planning, organizing, and producing food of a consistently high

quality is no easy task. The kitchen manager, cook, or chef

begins the production process by determining the expected

volume of business for the next few days. Sales during the

same period in the previous year give a good indication of the

expected volume and the breakdown of the number of sales of

each menu item. As described earlier, ordering and receiving

will have already been done for the day’s production schedule.

The kitchen manager checks the head line-cook’s order,

which will bring the prep (preparation) area up to the par stock

of prepared items. Most of the prep work is done in the early

part of the morning and afternoon. Taking advantage of slower

times allows the line cooks to do the final preparation just prior

to and during the actual meal service. The kitchen layout is set

up according to the business projected as well as the menu

design. Most full-service restaurants have similar layouts and

designs for their kitchens. The layout consists of the receiving

area, walk-ins, the freezer, dry storage, prep line, salad bar,

cooking line, expediter, dessert station, and service bar area.

The cooking line is the most important part of the kitchen

layout. It might consist of a broiler station, pickup area, fry

station, salad station, sauté station, and pizza station—just a

Planning, organizing, and producing food are critical tasks for the kitchen manager.

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Back of the House

137

be qualified and experienced in the kitchen. Often, the most

competent chefs are used to train new hires. Such trainings are

usually done on the job and may include study material. Some

restaurants may even require new hires to complete a written

test, evaluating the skills acquired through the training process.

Ensuring adequate training is necessary because the suc-

cess of the business lies in the hands of the trainer and the

trainee. If employees are properly trained when they begin their

employment, little time and money will need to be spent on cor-

recting errors. Thorough training also helps in retaining employ-

ees for longer periods of time.

Training, however, does not stop after passing a test.

Developing the skills of all the employees is critical to the growth

and success of the kitchen and, ultimately, the restaurant. A

development program may consist of delegating duties or proj-

ects to the staff, allowing them to expand their horizons within

the kitchen and the restaurant business. Such duties include pro-

jections of sales, inventory, ordering, schedule writing, and train-

ing. This will help management get feedback on the running of

the kitchen and on how well the development program works in

their particular operation. Also, this allows for internal growth and

promotion. Having “trainers” and people who train the trainers is

important to the restaurant’s goal of offering exceptional quality

and service.

Production Procedures

Production in the kitchen is key to the success of a restaurant

since it relates directly to the recipes on the menu and how much

product is on hand to produce the menu. Thus, controlling the pro-

duction process is crucial. To undertake such a task, production

control sheets are created for each station, for example, broiler,

sauté, fry, pantry, window, prep, dish, and dessert. With the con-

trol sheets, levels are set up for each day according to sales.

The first step in creating the production sheets is to count

the products on hand for each station. Once the produc-

tion levels are determined, the amount of product required to

reach the level for each recipe is decided. Once these calcula-

tions are completed, the sheets are handed to the cooks. It is

important to make these calculations before the cooks arrive,

considering the amount of prep time that is needed before

the restaurant opens. For instance, if a restaurant is open only

for lunch and dinner, enough product should be on hand by

11:00

a.m. to ensure that the cooks are prepared to handle the

lunch crowd.

When determining production, par levels should be

changed weekly according to sales trends. This will help

control and minimize waste levels. Waste is a large contrib-

utor to increasing food cost; therefore, the kitchen should

determine the product levels necessary to make it through

only one day. Products have a particular shelf life, and if the

kitchen overproduces and does not sell the product within

its shelf life, it must be thrown away. More importantly, this

practice allows for the freshest product to reach the custom-

ers on a dailybasis.

After the lunch rush, the kitchen checks to see how much

product was sold and how much is left for the night shift. (Running

few of the intricate parts that go into the setup of the back of

the house. The size of the kitchen and its equipment are all

designed according to the sales forecast for the restaurant and

by the menu. The menu dictates the equipment needed as well

as the experience level of the cooks.

The kitchen will also be set up according to what the cus-

tomers prefer and order most frequently. For example, if guests

eat more broiled or sautéed items, the size of the broiler and

sauté must be larger to cope with the demand.

Teamwork, a prerequisite for success in all areas of the

hospitality and tourism industry, is especially important in the

kitchen. Due to the hectic pace, pressure builds, and unless

each member of the team excels, the result will be food that is

delayed, not up to standard, or both.

While organization and performance standards are necessary,

it is helping each other with the prepping and the cooking that cre-

ates teamwork. “It’s just like a relay race; we can’t afford to drop

the baton,” says Amy Lu, kitchen manager of China Coast restau-

rant in Los Angeles. Teamwork in the back of the house is like an

orchestra playing in tune, each player adding to the harmony.

Another example of organization and teamwork is having

five rules of control for running a kitchen:

1. Order it well.

2. Receive it well.

3. Store it well.

4. Make it to the recipe.

5. Don’t let it die in the window.

It is amazing to see a kitchen line being overloaded, yet every-

one is gratified when the team succeeds in preparing and serv-

ing quality food on time.

Kitchen/Food Production

Staffing and Scheduling

Practicing proper staffing is absolutely crucial for the success-

ful running of a kitchen. It is important to have enough employ-

ees on the schedule to enable the restaurant, as a whole, to

handle the volume on any given shift. Often it is better to over-

staff the kitchen, rather than understaff it, for two reasons. First,

it is much easier to send an employee home than it is to call

someone in. Second, having extra employees on hand allows

for cross-training and development, which is becoming a widely

used method.

Problems can also be eliminated if a staffing plan is created

to set needed levels. These levels should be adjusted according

to sales trends on a monthly basis. Also, crucial to the smooth

running of the kitchen is having a competent staff. This means

putting the best cooks in the appropriate stations on the line,

which will assist in the speed of service, the food quality, and

the quality of the operations.

Training and Development

Due to a high turnover rate, implementing a comprehensive

training program is vital in the kitchen. Trainers should, of course,

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CHAPTER 7 Restaurant Operations

138

out of a product is unacceptable and should not happen. If proper

production procedures are followed, a restaurant will not have to

“86” anything on the menu.) After all production is completed on

all stations, the cooks may be checked out. It is essential to check

out the cooks and hold them accountable for production levels.

If they are not checked out, they might slide on their production,

negatively impacting the restaurant and the customer.

The use of production sheets is also critical in controlling

how the cooks use the products, since production plays a key

role in food cost. Every recipe has a particular “spec” (specifica-

tion) to follow. When one deviates from the recipe, quality goes

down, consistency is lost, and food cost goes up. That is why it

is important to follow the recipe at all times. Standardized reci-

pes are developed for each menu item to maintain consistency

and minimize waste. It is very important to use them; otherwise,

a dish will taste one way today but be quite different tomorrow.

And fluctuation in standards leads to guest complaints.

7:00

a.m.–Arrive. Check the work of cleaning crew (such

as clogs in burners, stoves/ovens, etc.) for overall cleanli-

ness.

7:15–7:40–Set production levels for all stations (broiler/

hot sauce/expediter, cold sauce, vegetable preparation,

baker preparation, line preparation: sauté/noodles, pan-

try, fry/seafood portioning).

8:00–The first cooks begin arriving; greet them and allo-

cate production sheets with priority items circled.

9:00–On a good day, the produce arrives at 9:00

a.m.

Check for quality, quantity, accuracy (making sure the

prices match the quotation sheet), and that the produce

is stored properly.

9:30–11:00–Follow up on production.

The sauté cook, who is last to come in, arrives. He or she

is the closing person for the morning shift.

• Follow up on cleanliness, recipe adherence (using

standardized recipes), and production accuracy.

• Check the stations to ensure the storage of prepped

items (e.g., plastic draining inserts under poultry and

seafood), the shelf life of products, general cleanli-

ness, and that what is in the station is prepared

correctly (e.g., turkey diced to the right size and por-

tioned and dated correctly).

10:45–Final check of the line and production to ensure

readiness. Did everyone prepare enough?

11:00–2:30–All hands on deck. Jump on the first ticket.

Pre-toast buns for burgers and hold in heated drawers.

Precook some chicken breasts for salads. Monitor lunch

until 2:30

p.m.

• Be responsible for cleanliness.

• Determine who needs to get off the clock.

• Decide what production is left for the remainder of

the day.

• Focus on changing over the line, change the food

pan inserts (BBQ sauce, etc.).

2:30–3:15–Complete changeover of the line and check

the stocking for the p.m. crew.

• Final prep portioning.

• Check the dishwasher area and prep line for

cleanliness.

• Check that the product is replaced in the store walk-

in or refrigerator.

• Reorganize the produce walk-in. Check the storage

of food, labels, and day dots, lids on.

• Thank the

a.m. crew and send them home.

4:00–4:15–Welcome the p.m. crew.

• Place produce order (as a double-check, ask the

p.m. crew what they might need).

5:00–Hand over to the p.m. manager.

Introducing

Jose Hernandez,

KitchenManager

Management Involvement

andFollow-Up

As in any business, management involvement is vital to the suc-

cess of a restaurant. Management should know first-hand what is

going on in the back of the house. It is also important that they be

“on the line,” assisting the staff in the preparation of the menu and

in the other operations of the kitchen, just as they should be helping

when things are rushed. When management is visible to the staff,

they are prone to do what they need to be doing at all times, and

food quality is more apparent and consistent. Managers should

constantly be walking and talking food cost, cleanliness, sanitation,

and quality. This shows the staff how serious and committed they

are to the successful running of the back of the house. Figure 7–2

is a job description for a typical assistant restaurant manager.

As management spends more time in the kitchen, more

knowledge is gained, more confidence is acquired, and more

M07_WALK4919_04_SE_C07.indd 138 06/11/17 3:13 PM

Back of the House

139

respect is earned. Employee–management interaction produces

a sense of stability and a strong work ethic among employees,

resulting in higher morale and promoting a positive working

environment. To ensure that policies and standards are being

upheld, management follow-up should happen on a continual

basis. This is especially important when cooks are held account-

able to specifications and production and when other staff

FIGURE 7–2 Job Description for an Assistant Restaurant Manager.

POSITION TITLE: Assistant Manager

REPORTS TO: Manager

POSITION OVERVIEW

RESPONSIBILITIES AND DUTIES

with each other

with guests

with the hostess/host

with the manager

with the cashier

with the kitchen personnel

A. Planning and organizing

B. Coordinating

Under the general supervision of the manager, subject to

the Service Policy and Procedure Manual, assures con-

stantly and consistently the creation of maximal guest

satisfaction and dining pleasure.

Studies past sales experience records, confers with

manager, keeps alert to holidays and special events,

and so on; forecasts loads and prepares work

schedules for service employees in advance to meet

requirements.

Observes guest reactions and confers frequently

with servers to determine guest satisfactions, dis-

satisfactions, relative popularity of menu items,

and so on and reports such information with rec-

ommendations to the manager.

Observes daily the condition of all physical facilities

and equipment in the dining room, making recom-

mendations to the manager for correction and im-

provements needed.

Anticipates all material needs and supplies and

assures availability of same.

Inspects, plans, and assures that all personnel, fa-

cilities, and materials are in complete readiness to

provide excellent service before each meal period.

Anticipates employment needs, recommending to

the manager plans for recruitment and selection to

meet needs as they arise.

Discusses menu changes with servers in advance to

assure full understanding of new items.

Conducts meetings of service employees at appro-

priate times.

Deﬁnes and explains clearly for servers and bus-

persons their responsibilities for relationships

Ensures that servers are fully informed as to all

menu items—how they are prepared, what they

contain, number of ounces per portion.

Periodically discusses and reviews with employees

company objectives, and guest and personnel

policies.

D. Controlling

E. Other

C. Supervising

Keeps manager informed at all times about service

activities, progress, and major problems.

Actively participates in employment of new servers

and buspersons, suggests recruitment sources,

studies applications, checks references, and con-

ducts interviews.

Following an orientation outline, introduces new

employees to the restaurant, restaurant policies,

and fellow employees.

Using a training plan, trains new employees and

current employees in need of additional training.

Promptly corrects any deviations from established

service standards.

Counsels employees on job issues and personal

problems.

Follows established policy in making station as-

signments for servers.

Establishes, with approval of manager, standards

of conduct, grooming, personal hygiene, and dress.

Prepares, in consultation and with approval of the

manager, applied standards of performance for

servers and buspersons.

Recommends deserving employees for promotion,

and outstanding performers for special recogni-

tion and award.

Strives at all times through the practice of good

human relations and leadership to establish esprit

de corps—teamwork, unity of eort, and individ-

ual and group pride.

Remains constantly alert to the entire dining room

situation—is sensitive to any deviation or problem

and assists quickly and quietly in its correction,

alleviating guests’ complaints.

Greets and seats guests cordially and courteously,

to assure a sincere welcome and to express a gen-

uine interest in their dining pleasure.

Controls performance, conduct, dress, hygiene,

sanitation, and personal appearance of employees

according to established policies, standards, and

procedures.

Studies all evidence of waste of time and materials,

and makes recommendations for preventing further

waste.

In emergency situations, may serve guests, act as

cashier, or perform speciﬁcally assigned duties of

the manager.

Personiﬁes graciousness and oers hospitality to

guests and employees by showing “we’re glad

you’re here” and “we’re proud to serve you.”

10.

11.

12.

members are given duties to perform. Without follow-up, the

restaurant may fold.

It happens all too often: Supervisors only notice when a

mistake is made or something is going wrong. It is important

for management to recognize the good things and give praise

when it is deserved. Employees appreciate positive reinforce-

ment and recognition.

M07_WALK4919_04_SE_C07.indd 139 06/11/17 3:13 PM

CHAPTER 7 Restaurant Operations

140

theft. The best way to avoid losses is to have the chef prepare

the order, the manager or the manager’s designee place the

order, and a third person responsible for the stores receive the

goods together with the chef (or the chef’s designee).

Commercial (for-profit) restaurant and foodservice operators

who are part of a chain may have the menu items and order

specifications determined at the corporate office. This saves

the unit manager from having to order individually; specialists

at thecorporate office not only develop the menu but also write

the specifications for the ingredients to ensure consistency.

Both chain and independent restaurants and foodservice oper-

ators use similar prepurchase functions.

• Plan menus.

• Determine quality and quantity needed to produce

menus.

• Write specifications and develop market orders for

purchases.

• Determine inventory stock levels.

• Identify items to purchase by subtracting stock levels

from the quantity required to produce menus.

Professor Emeritus Stefanelli at the University of Nevada,

Las Vegas, suggests a formal and an informal method of pur-

chasing, which includes the following steps.

Formal Informal

Develop purchase order Develop purchase order

Establish bid schedule Quote price

Issue invitation to bid Select vendor and place

order

Tabulate and evaluate bids

Award contract and issue

delivery order

Inspect/receive deliveries,

inventory stores, and record

transactions in inventory

Receive and inspect

deliveries, store, and

record transaction

Evaluate and follow up Evaluate and follow up

Issue food supplies for food

production and service

Issue food supplies for food

production and service

The formal method is generally used by chain restaurant oper-

ators and the informal one by independent restaurant operators

(see Figure 7-3).

Purchasing

Purchasing for restaurants involves procuring the products and

services that the restaurant needs in order to serve its guests.

Restaurant operators set up purchasing systems that deter-

mine the following:

• Standards for each item (product specification)

• Systems that minimize effort and maximize control of

loss from within the restaurant (theft, pilferage, or spoil-

age) and losses from other sources

• The amount of each item that should be on hand (par

stock and reorder point)

• Who will do the buying and keep the purchasing system

in motion

• Who will do the receiving, storage, and issuing of items

It is desirable for restaurants to establish standards for each

product, which is called product specification. When order-

ing meat, for example, the cut, weight, size, percentage of fat

content, and number of days aged are all factors that are speci-

fied by the purchaser.

Establishing systems that minimize effort and maximize con-

trol of loss may be done manually or by computer or a combina-

tion. However, merely computerizing a system does not make

it theft-proof. Instead, employing honest workers is a top prior-

ity because temptation is everywhere in the restaurant industry.

One story about stealing happened at a restaurant at which the

author worked. It was a nice old place with wrought iron gates

as a door to the bar. The thieves got a fishing pole and inserted it

between the iron posts of the gate and took several bottles out.

They removed some of the alcohol, then added water or colored

liquid. Eventually, external auditors checked the proof content of

the spirits and found them diluted. It was later discovered that

several servers at the restaurant had incurred gambling debts at

the new casino and were paying them off with the restaurant’s

liquor. This was discovered when the police “interviewed” some

of the suspects. Would you believe that some of the bottles at

the casino had the stamp of the restaurant on them?

An efficient and effective system establishes a stock level that

must be on hand at all times. This is called a par stock. If the stock

on hand falls below a specified reorder point, the computer system

automatically reorders a predetermined quantity of the item.

In identifying who will do the buying, it is most important to

separate task and responsibility between the person placing the

order and the person receiving the goods. This avoids possible

FIGURE 7–3 Food Cost Control Process.

Menu Planning

Food Cost Analysis

Forecasting

Sales

Purchasing Receiving

Service Production Issuing

Storing

M07_WALK4919_04_SE_C07.indd 140 06/11/17 3:13 PM

Cost Control

141

employees to bring bags into the restaurant with them; employ-

ing a good accountant; and, yes, checking the garbage! You’ll be

amazed what you will find in the garbage—some dishonest peo-

ple use the garbage as a constant way to remove valuable items

from the restaurant and collect them later from the garbage area.

In the movie Five Easy Pieces, star Jack Nicholson goes

to a restaurant and orders a side order of whole-wheat toast.

The waitress makes it clear that they do not serve whole-wheat

toast. Nicholson notes on the menu that the chicken salad

sandwich comes on whole-wheat bread. The annoyed wait-

ress points to a sign in the restaurant that reads “No substitu-

tions” and “We reserve the right to refuse service to anyone.”

Jack Nicholson orders a chicken salad sandwich on whole-

wheat toast, but tells the waitress to hold the mayo, hold the

lettuce, hold the chicken salad, and just bring him the whole-

wheat toast. Unwisely, she asks where she should hold the

chicken salad. Nicholson sarcastically responds, “Between

your knees!” On that note he leaves, a very dissatisfied guest.

Check Your Knowledge

1. List the five rules of cost control and explain why

they are important.

2. Why do restaurant operators set up purchasing

systems?

3. Why is thorough training important in back of house

operations?

Cost Control

Learning Outcome 4: Calculate basic food, beverage,

and labor cost percentages.

A purchase order comes as a result of the product specifi-

cation. As it sounds, a purchase order is an order to purchase a

certain quantity of an item at a specific price. Many restaurants

develop purchase orders for items they need on a regular basis.

These are then sent to suppliers for quotations, and samples

are sent in for product evaluations. For example, canned items

have varying amounts of liquid. Normally, it is the drained

weight of the product that matters to the restaurant operator.

After comparing samples from several vendors, the operator

can choose the supplier that best suits the restaurant’s needs.

Receiving

When placing an order, the restaurant operator specifies the day

and time for the delivery to be made (e.g., Friday, 10:00

a.m. to

12:00 noon). This prevents deliveries from being made at incon-

venient times.

Receiving is a point of control in the restaurant operation.

The purpose of receiving is to ensure that the quantity, quality,

and price are exactly as ordered. The quantity and quality relate

to the order specification and the standardized recipe.

Depending on the restaurant and the type of food and beverage

control system, some perishable items are issued directly to the

kitchen, and most of the non-perishable items go into storage.

Storing/Issuing

Control of the stores is often a problem. Records must be kept

of all items going into or out of the stores. If more than one

person has access to the stores, it is difficult to know where to

attach responsibility in case of losses.

Items should only be issued from the stores on an authorized

requisition signed by the appropriate person. One restaurateur

who has been in business for many years issues stores to the

kitchen on a daily basis. No inventory is kept in the production

area and there is no access to the stores. To some, this may be

overdoing control, but it is hard to fault the results: a good food

cost percentage. All items that enter the stores should have a date

stamp and be rotated using the first in–first out (FIFO) system.

FIFO is a simple but effective system of ensuring stock rota-

tion. This is achieved by placing the most recent purchases,

in rotation, behind previous purchases. Failure to do this can

result in spoilage.

Obviously, restaurants should maintain strict controls.

Better-known controls include taking inventory regularly and

calculating food, beverage, and labor cost percentages. For a

restaurant to be successful, management must “manage” by

controlling food, beverage, and labor costs and keeping them

in line with company expectations based on budget.

A tight control is maintained on food costs by having the

receiving done by a person other than the person who orders

the food—this lessens the chance of over-ordering. At one res-

taurant where I worked as a food and beverage manager, it was

discovered that the chef was doing the ordering and receiving;

however, some of the receiving was done at “another” restaurant

owned by the chef’s brother! Needless to say, the chef was let

go. Other strict controls include using a “par stock” reordering

system; using one entrance/exit for employees and not permitting

Jim Barber/Shutterstock

M07_WALK4919_04_SE_C07.indd 141 06/11/17 3:13 PM

CHAPTER 7 Restaurant Operations

142

Chris Robinson

Chain Restaurant General Manager

hris works a combination of open (typically 7 a.m.–6 p.m.),

swing (11

a.m.–10 p.m.), and close (5 p.m.–3 a.m.) shifts,

depending on the needs of the business and her goals

for the week. Regardless of when Chris works, she is ulti-

mately responsible for food safety and quality, employee

staffing and training, guest satisfaction, and restaurant profit-

ability. Chris’s responsibilities are accomplished throughout

the day by conducting food line checks, employee shift meet-

ings, and guest table visits. As the general manager, Chris is

expected to be a role model for all the employees and man-

agers and is responsible for upholding the company credo.

Expectations of the General Manager

The expectations of the general manager are different in

each restaurant; however, there are certain commonalities

as well. Some of these include:

• General managers answer directly to the owner or to

regional directors in major corporations.

• General managers are expected to run good numbers for

the periods. The numbers analyzed are food cost, labor

cost, and beverage cost. These areas are controlled in

order to produce sucient proﬁt for the restaurant.

• General managers promote good morale and teamwork

in the restaurant. Having a positive environment in the

restaurant is of utmost importance. This will not only

keep the employees happy, but it will also contribute to

providing better service to the guests.

Duties and Responsibilities

The general manager of a restaurant is directly responsible

for all the operations in the restaurant. General managers are

also in charge of the floor managers, the kitchen manager,

and the other employees of the restaurant.

The general manager should always check on the floor

managers to ensure that all policies and regulations are

being met. This will keep operations running smoothly.

Another important duty is to organize and control the

staffing of the restaurant. The floor managers usually write

the employee schedule; however, the general manager is still

directly responsible for proper staffing for the period. This will

help keep labor costs to about 20 percent of sales. The gen-

eral manager also conducts employee reviews and training.

Qualifications for a

General Manager

A general manager has the

following qualifications:

• He or she should be

very knowledgeable about the restaurant business.

• He or she should have worked all the stations in a

restaurant and be very familiar with them.

• The general manager should be able to get along

withall people, be fair with all employees, and not

discriminate.

Budgeted Costs in a Restaurant

Running a good pace in the restaurant is of absolute impor-

tance. Every restaurant has different numbers to make.

The following results came from a chain restaurant. These

results reflect their goals versus actual numbers run for a

given week.

As can be seen, this restaurant did well with the bever-

age cost; however, the food cost and the labor cost are two

areas to focus on for the upcoming week. Making good per-

centages for the restaurant is the top priority because this

is where the restaurant makes or does not make a profit.

When the general manager runs good numbers, he or she

receives a large bonus check for contributing to the profit

of the restaurant. This is why it is so important to focus on

these three key areas.

Scheduling the Restaurant

Appropriate scheduling plays a key role in the success

of the restaurant. For one thing, overscheduling and

underscheduling have a direct effect on the labor cost. If

there are too many employees working on a shift for the

business that is done, then the labor cost will be high.

In contrast, if there are not enough employees working,

then the service will suffer and overtime will increase the

labor cost.

Goal Actual Variance

Food Cost 27.0 27.2

+0.2

Labor Cost 19.9 20.8

+0.9

Beverage Cost 19.0 18.2

-0.8

Introducing

The Restaurant

GeneralManager

John Lund/Marc Romanelli/Getty Images

M07_WALK4919_04_SE_C07.indd 142 06/11/17 3:13 PM

Cost Control

143

from a low of 18 on up to 30 percent, with an average around

22 to 26percent beverage cost. Of course, there are different

percentages for beer, wine, spirits, and cocktails—just to make

the job more interesting!

Labor Cost Control

Like other service industries, labor is the highest cost in

operating a restaurant. Labor costs range from about 24 to

30percent of total sales. One of the challenges of restaurant

operations is scheduling the right amount of staff for each

shift. As the number of guests and sales increases, more

staff are needed but, when sales drop, so should the number

of staff.

In the above example, the food and beverages sales are

$95,400 and $46,000, making the total sales $141,400. Given

a labor cost of $35,350, by using the formula of labor costs

over sales we have:

$35,350

$141,400

= 0.25 or 25

A labor cost of 25 percent means that for every dollar of sales,

25 percent goes to cover labor costs. Other operating costs include

non-food or labor costs such as office supplies, china, glassware,

knives, forks, spoons, table napkins, heat, light and power, clean-

ing, rent, lease or mortgage, music, menus, accounting and legal

fees, licenses, uniforms, and so on. Total other operating costs

range from 14 to 20 percent of sales.

Given that total sales are 100 percent, and each cost has

to be deducted from it, an example of restaurant costs would

look like this:

Food and Beverage Cost

Percentages

Managing restaurants is a complex operation. There are many

variables that need to be in line if the operation is to be suc-

cessful. One way that managers keep tabs on the operation’s

performance is by checking the food, beverage, and labor

costs. These costs, more than any other, need to be carefully

monitored on a daily, sometimes hourly, basis. Calculating a

food, beverage, or labor cost is like taking the temperature of

the operation. We can find out how we are doing on a regular

basis. The food cost percentage is calculated as the cost of

food sold divided by food sales for a specific period, such as a

week, 14 days, a month, or a year to date. The result is com-

pared to the budgeted percentage for the period. An example is

of a casual restaurant:

Total Food Sales $95,400

Total Beverage Sales $46,000

Cost of Food Sold $22,896

Cost of Beverage Sold $ 8,892

Labor Costs $35,350

The food cost percentage is (remember the simple formula,

cost over sales times 100):

Cost of food sold

Total food sales

$22,896

$95,400

= 0.24 or 24% food cos

A food cost of 24 percent shows us that $0.24 of each

$1.00 of food sales is spent on the cost of food prepared.

Most chain restaurants calculate the cost of ingredients and

use standardized recipes so that they expect a menu item to

have a $0.24 food cost percentage. As you progress in your

career, you will realize that some menu items have a higher or

lower food cost percentage and that the restaurant company

must decide what results it expects. For example, 24 percent

is too low for some restaurants and means that guests may

find the prices too high. Restaurants generally average about

28 percent food cost; however, high-end steak houses run

a 34 percent food cost—they make up for that with a lower

labor cost in the kitchen.

The beverage cost percentage is calculated in the

same way as the food cost: cost of beverages sold divided

by the total beverage sales for a period. Like the food cost

percentage, it is best utilized as a tool for cost control when

compared to the budgeted percentage for the same period.

Any significant variances from the budgeted amount should

be investigated. The beverage cost in the casual restaurant

above is:

Cost of beverage sold

Total beverage sales

$8,892

$46,000

= 19.33

So, for every beverage dollar earned, the cost was 19

percent. Restaurants vary in their beverage cost percentage

Total Sales $141,400

Category Cost Calculation

% Cost

of Total

Food $22,896

$22,896 , 141,400 * 100

16.19%

Beverage $ 8,892

$8,892 , 141,400 * 100

6.28%

Labor $35,350

$35,350 , 141,400 * 100

25%

Other $28,280

$28,280 , 141,400 * 100

20%

Total = 67.47 %

leaving 32.53 percent for any other costs, taxes, and profit.

Another important part of restaurant control is stopping

employee theft. As one experienced operator put it, “In each of

the restaurants that I worked at, someone was stealing.”

Here

are a few of the many ways employees can steal from restau-

rants. Some restaurant employees under-ring sales andtear up

the order ticket. For example, if an order for a round of drinks

comes to $16.95, the employee rings up $6.95 and puts a

swizzle stick in the till as a reminder that the draw is over by

$10. If there are eight swizzle sticks in the draw at the end of

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CHAPTER 7 Restaurant Operations

144

the shift, the employee pockets $80. Or, when the guest pays

the check, the server tears up the order and pockets the cash

instead of putting the money and a completed order ticket in

the register. In order to avoid this, restaurants use spotters

(people who sit in a bar or restaurant and watch everything

that goes on). Restaurants also require sequentially numbered

checks and insist that the servers return all checks at the end

of the shift.

We have discussed the move for a $15 per hour wage for all

restaurant employees in a previous section, and it will be inter-

esting to see if, when, and how this happens.

Check Your Knowledge

1. If the cost of food sold is $34,789 and the total food

sales is $105,006, calculate the food cost percentage.

2. If the cost of beverages sold is $9,723 and the total

beverage sales is $51,231, what is the beverage cost

percentage?

3. Given the food and beverage percentages from the

previous questions, how would you evaluate the

health of the restaurant?

Sustainability is not just a philosophy about food—it’s

about people, attitudes, communities, and lifestyles. In

the spirit of the theme of this year’s International Chefs

Congress—“The Responsibility of a Chef”—the ideas

below come from chefs across the country. There’s an

idea to inspire you each day of the next month; even

picking one to look into, or act on, per week is a good

way to start. Almost everywhere one goes, we hear the

same message: small changes and efforts can make a

big difference!

1. Go local. It’s not possible for everyone all the time.

But when it is possible, support your local farmers.

2. Take your team to visit a farmer. This is good

practice for remembering that each piece of food has a

story and a person behind it. (And you can bring back

extra produce for a special family meal.)

3. Know your seafood. The criteria for evaluating the

sustainability of seafood differ from those for agricul-

ture. Inform yourself using resources like California’s

Monterey Bay Aquarium’s Seafood Watch Guide,

and demand that your purveyors are informed too. If

they can’t tell you where a fish is from, and how and

whenit was caught, you probably don’t want to be

serving it.

4. Not all bottled water is created equal. Some com-

panies are working to reduce and offset their carbon

footprint through a number of innovative measures.

And some of the biggest names in the restaurant

world (like The French Laundry) are moving away from

water bottled out of house. In-house filtration systems

offer a number of options—including in-house spar-

kling water!

5. Ditch the Styrofoam. Replace cooks’ drinking cups

with reusable plastic ones, and replace Styrofoam

take-out containers with containers made of recycled

paper. BioPac packaging is one option.

6. Support organic, biodynamic viniculture. There are

incredible, top-rated biodynamic or organic wines from

around the world.

7. Support organic bar products. All-natural and

organic spirits, beers, and mixers are growing in

popularity and availability.

8. Even your kitchen and bar mats can be respon-

sible. Waterhog’s EcoLine is made from 100 percent

recycled PET postconsumer recycled fiber reclaimed

from drink bottles and recycled tires.

9. Devote one morning per quarter or one morning

per month to community service. Send staff to a

soup kitchen, bring local kids into the kitchen, teach

the kitchen staff of the local elementary school a few

tricks, or spend a few hours working in the sun at a

community garden.

10. The kitchen equipment of the future is green!

Major equipment producers, like Hobart and Unified

Brands, are developing special initiatives to investigate

and develop greener, cleaner, energy-smart machines

(that also save you money in the long run).

11. Shut down the computer and POS systems when

you leave at night. When the computer system is

on, the juice keeps flowing—shutting it down can save

significant energy bill dollars over the course of a year.

12. Check the seals on your walk-in. If they’re not kept

clean and tight, warm air can seep in, making the

fridge work harder to stay cool.

13. Compact fluorescent light (CFL) bulbs use

75 percent less energy than incandescent bulbs.

CFLs also last 10 times longer, giving them the envi-

ronmental and economic advantage.

14. Consider wind power. Ask your energy provider

about options—ConEd, for example, offers a wind-

power option. Though it tends to cost 10 percent more

than regular energy, there’s an incentive to bring the bill

down by implementing other energy-saving techniques

to offset the higher cost of wind power.

15. Look into solar thermal panels to heat your

water. Solar Services, one of the oldest and biggest

companies, will walk you through the process—from

Sustainable Restaurant Operations

M07_WALK4919_04_SE_C07.indd 144 06/11/17 3:13 PM

Cost Control

145

paperwork to tax credits. With the money saved on a

water heater, the system will have paid for itself in two

to three years.

16. Green your cleaning routine. Trade astringent,

nonbiodegradable, potentially carcinogenic chemical

kitchen cleaners for biodegradable, eco-safe products.

17. Use nontoxic pest control. The options are increas-

ing, and even some of the major companies have

green options.

18. Consider purchasing locally built furniture. See

if there are any artisans in your state working with

reclaimed wood (from trees that have fallen naturally

because of storms or age).

19. Recycle your fryer oil. Biofuel companies across the

country will pick it up and convert it.

20. Grow your own. Consider a roof-top garden or inte-

rior/exterior window boxes for small plants and herbs.

EarthBoxes are one low-maintenance solution.

21. Cut down on shipping materials. Request that pur-

veyors send goods with the least amount of packing

materials possible. Request that Styrofoam packaging

not be used.

22. Trade in white toilet paper, c-folds, and rest-

room paper towels. Instead, use products made of

chlorine-free unbleached, recycled paper.

23. Need new toilets? There are a number of water-

saving options that save anywhere from half a gallon to

more than a gallon per flush. The old-fashioned brick

technique is a good start too: place a brick in the tank

of your toilet—the space that it takes up is water saved

each time the toilet is flushed.

24. Compost garbage. Even high-volume establishments

can make this happen. Keep separate cans for all

food-based waste, and dump it in a compost bin out

back. A common misconception about compost is

that it smells bad—this is not true!

25. Recycle! Be strict about kitchen and bar staff recy-

cling glass and plastic receptacles. Recycle cardboard

and wood boxes used for produce, and any newspa-

pers or magazines sent to the restaurant.

26. Cut down on linens. Tablecloths and napkins re-

quire a large amount of chemical cleaners, bleaches,

and starches. Stay away from white, if possible. If it’s

not imperative, consider eliminating tablecloths all to-

gether. Go for soft cloth napkins instead of starched.

27. Ice = water + energy. Don’t waste it! Don’t automati-

cally refill ice bins—wait until they truly get low, and

only add as much as you need to get through the

crush. Ice is expensive to produce, both in terms of

money and resources.

28. If you’re a small restaurant or café, without

huge needs or storage space, look into joining

(or forming) a local co-op for purchasing green

items. Cleaning supplies, paper products, and so on

are all cheaper in bulk.

29. Educate yourself! From agricultural philosophy to the

specifics of restaurant operations, the number of re-

sources for green issues and practices is ever-growing.

Pick up The Omnivore’s Dilemma by Michael Pollan,

the Green Restaurant Association’s Dining Green:

A Guide to Creating Environmentally Sustainable

Restaurants and Kitchens, and Seafood Handbook:

The Comprehensive Guide to Sourcing, Buyingand

Preparation by the Editors of Seafood Business.

30. Last but not least, educate your staff! They need

to know why you’re doing what you are doing, so that

they can spread the word—to the diners, and beyond!

Finally, let us look at how one operating partner manages

his restaurant. Matt Andrus manages a great seafood restau-

rant, The Anna Maria Oyster Bar in Bradenton, Florida. Matt

utilizes the elements of management to make his restaurant

successful. Planning for Matt includes financial planning where

he monitors the financial goals daily. Monday is his planning

day; he decides what to delegate to each of his opening,

middle, and closing managers. Sales and guest counts are

projected based on last and previous year’s sales figures and

are generally accurate to within two to three percent.

Matt organizes his restaurant by having his various

managers use check lists to cover all important aspects of

running the restaurant. For example, in the kitchen, one man-

ager is responsible for cleanliness, another for ordering, and

a third for hiring and training. In the front of the house,one

manager focuses on the bar and beverages, one on servers

and bussers, and another on paperwork, including I-9’s. He

holds a biweekly meeting of all managers to review past per-

formance from top line to the bottom line and to discuss

future business. At this meeting, any under-performers are

discussed (these are people who are not “ringing up” all

their sales nor suggestively selling items, or some other thing

not done in accordance with policies and procedures). Matt

uses a “par” system to ensure availability of items.

Decision making and communicating are done all day

and every day. Matt gives his managers the tools and lets

them decide and take care of the key result areas. Results

of food, beverage, and labor costs are monitored daily and

compared to sales and action is taken to rectify the situation,

when necessary. Matt has inventory taken monthly, unless

there is a suspected problem; in which case, inventory is

taken as needed.

Control is an on-going item. Labor costs are watched by

the hour as they are one of the highest costs. Food and bever-

age costs are also closely monitored daily. For example, Matt

expects the liquor-pouring costs to be 18% of liquor sales;

bottled beer to be 25 % of bottled beer sales; draft beer 15%

of draft beer sales; and wine 35% of wine sales. Maintenance

is checked each day and its costs are also controlled.

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CHAPTER 7 Restaurant Operations

146

Restaurant Operations

Choosing a management career in restaurant operations

means that you have just selected the area of hospitality

that offers college graduates enormous opportunity, the

highest starting salaries in the hospitality industry, and

the best opportunities for advancement. Opportunities

range from fast-food to five-star dining. Salaries range

from $32,000 to over $40,000 for assistant management

positions (this may be slightly lower or higher depending

on the location in the United States). Where you will be on

that continuum depends on the skills you acquired while

in the restaurant industry during college and your ability

to sell yourself. The type of operation, sales volume, and

location of the establishment also affect salaries.

Higher salaries mean a more competitive environment

for jobs. In the last few years, salaries have started to

increase, reflecting the restaurant industry’s willingness

to hire experienced young talent. Recruiters refer to these

graduates sometimes as grade A candidates or thorough-

breds. Recruiters want graduates who are confident in their

skills and have a work record that shows a genuine interest

in restaurant management (see Figure 7-4).

Possessing confidence and skill is necessary to

complete the management training programs and to get

through your first year as a manager. Typically, restau-

rant managers work 50 to 60 hours a week, including

weekends and holidays. It is a physically demanding job

that requires being constantly on your feet and working

under pressure in a fast-paced environment.

However, this kind of challenge has tremendous rewards.

As a manager, you will work in an atmosphere that offers end-

less opportunities to delight guests and motivate employees.

Few things are more gratifying than a genuinely satisfied guest

or sharing in the pleasure of a restaurant crew’s success-

fully completed shift. Restaurant operations typically pay

people based strictly on performance. It is not uncommon for

restaurant general managers to make six-figure incomes from

restaurants that generate $5 million plus in sales.

Career Information

CASE STUDY

It’s 9:30 on a Friday morning at The Pub. Product is sched-

uled to be delivered at 10:00. Sally specifically ordered an

exceptional amount of food for the upcoming holiday week-

end because she is projecting it to be busy. Sally receives

a phone call at 10:30 from J&G groceries, stating that it

cannot deliver the product until 10:00

a.m. on Saturday

morning. She explains to the driver that it is crucial that

she receives the product as soon as possible. He apolo-

gizes; however, it is impossible to have delivery made until

Saturday morning.

By 1:00

p.m., The Pub is beginning to run out of product,

including absolute necessities such as steaks, chicken, fish,

and produce. The guests are getting frustrated because the

staff are beginning to “86” a great deal of product. In addi-

tion, if they do not begin production for the

p.m. shift soon,

the restaurant will be in deep trouble. On Friday nights,

The Pub does in excess of $12,000 in sales. However, if

the problem is not immediately alleviated, it will lose many

guests and a great amount of profits.

DISCUSSION QUESTIONS

1. What immediate measures would you take to resolve

the problem?

2. How would you produce the appropriate product as

soon as possible?

3. Who should you call first, if anyone, to alleviate the

problem?

4. What can you do to always have enough product on

hand?

5. Is it important to have a backup plan for a situation like

this? If so, what would it be?

Shortage in Stock

FIGURE 7–4 Career Pattern in the Restaurant Industry.

Busser

Shift

Leader

Food

Server

Management

Trainee

Assistant

Manager

Vice

President

General

Manager

Regional

Manager

President Manager

M07_WALK4919_04_SE_C07.indd 146 06/11/17 3:13 PM

147

Summary

1. The National Restaurant Association has identified the

following functional areas of a foodservice manager’s

job: human resource management, financial manage-

ment, administrative management, and operations

management.

2. The front of the house includes anyone with guest con-

tact, from those in charge of maintaining curbside appeal

to the bus person. The general manager or restaurant

manager runs the restaurant. There may be more manag-

ers with special managers who are cross-trained in order

to relieve each other. The host greets guests and rotates

arriving guests among the sections. Servers take and

present orders, offer high-quality service, and use sugges-

tive selling to increase food and beverage sales. Bussers

clear tables.

Restaurants formulate a budget projecting sales and

costs for a year on a weekly and monthly basis. Such

forecasting involves estimating the number of guests and

average guest check. Average guest check is calculated

by dividing the total sales by number of guests. The num-

ber of guests forecast for each day is multiplied by the

amount of the average food and beverage check for each

meal to calculate the total forecast sales. Each day, actual

totals are compared with the forecasts. Forecasting is also

used to predict staffing levels and labor costs.

Cloud-based point of sale and reservation systems

help keep front of the house operational. Fast-casual res-

taurants use order-ahead apps to offer convenience.

A $15 per hour proposed minimum wage is controver-

sial. Restaurants have developed solutions for rising labor

costs.

3. The back of the house is generally run by the kitchen

manager and refers to all the areas with which guests

do not normally come in contact (purchasing, receiving,

storing/issuing, food production, stewarding, budgeting,

accounting, and control). Some of the main consid-

erations in efficiently operating the back of the house

include staffing, scheduling, training, food cost analysis

(internal controls), production, management involvement,

management follow-up, and employee recognition.

4. One way that managers keep tabs on the operation’s

performance is by checking the food, beverage, and labor

costs. These costs, more than any other, need to be care-

fully monitored on a daily, sometimes hourly, basis. The

food cost percentage is calculated as the cost of food

sold divided by food sales for a specific period. The result

is compared to the budgeted percentage of the period.

Beverage cost percentage is calculated the same way.

Labor is the highest cost in operating a restaurant.

Cost is calculated by dividing the total labor cost by the

total sum of food and beverage sales.

Key Words and Concepts

American service

Average guest check

Back of the house

Beverage cost percentage

86'ed

First in–first out (FIFO)

Food cost percentage

French service

• Social media for restaurants offer both the restaurant

and customers the ability to seek out and provide

feedback on the dining experience. Social media offer

an array of tools for increased marketing and aware-

ness, operations management, and customer selec-

tion of the dining experience.

• Twin and multi-restaurant locations.

• Quick-service restaurants (QSRs) in convenience

stores.

• Food trucks and pop-ups are appearing in most major

cities, as well as many cultural towns and suburban

centers. The options of menu items and cuisine styles

are rapidly increasing, thereby providing customers

with a multitude of offerings.

• Increase in casual dining, especially fast casual.

Trends in Restaurant Operations

• More flavorful food.

• Increased take-out meals, especially at lunch, and more

home meal replacement (for dinner).

• Increased food safety and sanitation.

• Increasingly sophisticated guests need more exciting

offerings.

• More food court restaurants in malls, movie theater

complexes, airports, gas stations, and colleges and

universities where guests line up (similar to a cafeteria),

select their food (which a server places on a tray), and

pay a cashier.

• Loyalty programs, group discounts, gift cards, and cou-

pons. People are dining out now as much as ever, and

the typical customer is all about a good dining experi-

ence at a discounted price.

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CHAPTER 7 Restaurant Operations

148

in Dallas, the chain now has more than 637 restaurants in

the United States and 20 other countries.

a. What requirements must you meet to open a Chili’s

franchise? From what you have learned about the issues

involved in starting your own business, how is setting up

your own business different from having a franchise?

b. What is the “Chilihead culture”?

Apply Your Knowledge

1. In a casual Italian restaurant, sales for the week of

September 15 are as follows:

Food sales: $10,000

Beverage sales: $ 2,500

Total: $12,500

a. If the food cost is 30 percent, how much did the

food actually cost?

b. If the beverage cost is 25 percent of beverage

sales, how much did the beverages cost?

c. If the labor cost is 28 percent, how much money

does that represent and how much is left over for

other costs and profit?

2. If a 33 percent food cost is required and a menu item sells

for $16.95, what is its cost supposed to be?

3. Sales at your restaurant for the month of October are

$685,324. If a 25 percent labor cost is expected, what

would that be in dollars?

Suggested Activities

1. In groups, interview a restaurant manager and check how

his or her duties and responsibilities compare with those

in the text.

2. In groups, look at the example of results in the chapter

and decide what you would do to improve the labor cost

percentage for the next week.

Endnotes

1. This section draws on John R. Walker, The Restaurant

from Concept to Operation, 5th ed. (New York: John

Wiley and Sons, 2009), pp. 86–87.

2. Please see the Moo Cluck Moo Website for more

information.

3. Personal conversation with Danny Meyer, January 14, 2006.

4. This section draws on John R. Walker, The Restaurant

from Concept to Operation, p. 275.

5. Ibid.

6. Personal conversation with Joe Riley, July 12, 2006.

7. Please see the Star Chefs Website for more information.

Front of the house

Gueridon

Guest counts or covers

NCO (neat, clean and organized)

Order specification

Par stock

Product specification

Production control sheets

Purchase order

Receiving

Restaurant forecasting

Russian service

Smiling people greeter (SPG)

Spotters

Standardized recipe

Suggestive selling

Review Questions

1. List key aspects of a restaurant manager’s job.

2. What is considered the front of the house?

3. Who runs the back of the house and what areas does

back of the house refer to?

4. If the total food and beverage sales for a restaurant are

$164,009 and the labor costs are $42,125, find the labor

cost percentage.

Imagine the restaurant in #4 is a fine dining restaurant.

Does this labor cost percentage seem reasonable? Why or

why not?

Internet Exercises

1. Organization: National Restaurant Association (NRA)

Summary: The NRA is the business association of the

food industry. It consists of 400,000 members and over

170,000 restaurants. Member restaurants represent table

service and quick-service operators, chains, and fran-

chises. The NRA helps international restaurants receive

the benefits of the association and gives guidance for

success to nonprofit members.

a. List the food-borne diseases presented on the

NRA site. Read about each disease and what the

NRA says about how to prevent it.

b. What kinds of careers are available in the restau-

rant and hospitality industry?

c. Check the top stories at the NRA’S Website;

www.restaurant.org

2. Organization: Chili’s Grill and Bar

Summary: Chili’s is a fun and exciting place to have

burgers, fajitas, margaritas, and chili. Established in 1975

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