The paper "Hospitality Management - Monitoring Catering Revenue and Costs" is a great example of an assignment on management. This paper aims to chalk out the plan of action for Billy Blue Brasserie in order to successfully combat challenges faced due to the recession bug striking the catering and restaurant business in general, both worldwide and specifically, in Australia. As Executive Chef/Manager of Billy Blue Brasserie, I would like to first prepare a market and business analysis of the current scenario and how it affects our industry. The paper will also touch upon the various aspects of running a restaurant such as purchasing systems, storage and control of food items, Management and implementation of stock records, Development of food control and production schedules, Development of well-planned workflows and staff schedules, Application of menu engineering techniques to track daily sales and maximize profitability, Preparation and analysis of income statements, budgets and financial records and suggest appropriate software/hardware and computer systems increase profitability. Impact of Recession According to the market intelligence provider Key Note, in its recent study on the impact of the recession on the catering industry, casual dining outlets are definitely impacted in a great way.
“ Fast-food chains may also gain from the credit crunch by attracting consumers that are trading down from the casual-dining outlets” (Catering Market Report, Key Note Report, 2009, p 5). The same report has predicted that restaurant sales will decline in comparison to figures in 2008, and catering sales through licensed clubs will remain static. According to Key Note, “ an increased focus on value meals by operators such as the pub-restaurant chains” is the future trend. In Australia, the restaurant and catering industry employs hundreds of thousands of people and has thus far attracted over 40,000 business owners.
Raising capital is proving to be a huge challenge with banks becoming extremely strict on their lending policies. Also, the average meal at any restaurant is nearly thrice that of a home-cooked meal, yet growth is anticipated in this sector. Factors that could continue to draw people towards restaurants and dining outside are convenience, enjoyment, and quality food. The current fear is that rising costs outweigh rising sales figures.
According to the President, Restaurant and Catering Queensland, Summers (2009), "We're not just talking about a downturn in the economy here, we're talking about the labor rates are changing, the industrial instruments that we're working under are about to take a dramatic change, come January next year there's going to be a sharp increase in wage rates in our industry - some 30 percent. ” Hence it is clear that spiraling food costs, real estate expenditure, and wages are proving to be huge obstacles. Let us look at the areas that we need to focus on. Establishment and Implementing Purchasing Systems One must also look into the Purchasing System.
It is essential that procedures are laid down and followed by Billy Blue Brasserie towards the following objectives: to decide the quantity and quality of an item that is needed, to get the best possible price and to be updated on the sources of supply. The system needs to utilize EOQ (Economic Order Quantity), a Quantity discount, MRP (Material Requirement Planning), and Optimal Reorder Point. A good purchasing system will significantly reduce the workload associated with managing the purchasing process and thereby bring about tangible benefits to the company.
This allows you to automate, measure, and control the procurement needs of a restaurant.
ABC News, (May 21, 2009) ‘Qld Hospitality Feeling Pinch of Recession’
http://www.costguard.com/features.htm#catering, (July 8, 2009)
http://www.co.whatcom.wa.us/health/pdf/foodprepchart.pdf, July 8, 2009
http://www.fastcasual.com/article.php?id=8214 (July 8, 2001)
http://www.foodservicewarehouse.com/equipment/c3040.aspx, July 8, 2009
http://www.restaurantowner.com/public/377.cfm (July 8, 2009)
Key Note Market Research, (2008) ‘Catering Market Report’
Riell Howard, (2007) ‘How To Cut Food Costs’, [Online] Available
Schwartz, Bill (2006), ‘Menu Engineering: A Scientific Approach to Improve Menu Profitability’