Inventory Ideal Usage Report

The Inventory Ideal Usage Report is the key to determining whether your food cost is on track - and where your problem areas lie.

To run this report, Navigate to Manager Home > Reports > Inventory > Inventory Ideal Usage

Choose your date range.  Generally this report works best if you choose a range from one physical inventory to the next.  For example, if you always do inventory on Sunday night, you can run it from Monday to Sunday, after your inventory is posted.    Click on Generate.

This report is organized by inventory category, and for each ingredient it will tell you the ideal usage, ideal cost, actual usage and actual cost, as well as a positive or negative variance.

Typically, the ideal usage is calculated based on your items sold, provided you've associated ingredients with those items.    The actual usage is based on your physical inventory adjustment.  The difference can shed light on where you may have a problem with over use, under use or theft.

Let's take a closer look at some of the elements on this report.

At the top, you'll see your total sales for the period.

Your overall food cost ideal vs. actual is listed next.

The variance summary is a total of all the positive and negative variances. While these may even out on the "Sum" line, the "Total" line is always positive whether the variance is over use or under use, so you can see the overall impact of your discrepancies.

Now lets examine a particular ingredient more closely - Mozzarella.

In this example, the ideal usage of Mozzarella for the items we've sold is 13.50 pounds.  However, after our physical inventory, we've found that we actually used 20 pounds during the period.   This discrepancy is costing us $11.64.  Now you know you have an issue -- are cooks putting too much cheese on your pizza?  Are blocks of cheese walking out the door?   This report gives you the details you need to zero in on food cost problems.

Usage Per Thousand
For some operations, or some ingredients, its too hard to associate ingredients precisely with items sold.  If you sell a buffet, for instance, you may not know exactly what items were consumed.  Some ingredients like napkins, cleaning supplies, etc. are generally used but not associated with specific items sold.    For these ingredients, you can set up the Usage Per Thousand (UPT) target in ingredient setup.    This lets you set an estimated ideal usage per $1000 in sales based on projected or historical knowledge about the usage of these ingredients.

To see the variance of these items, select the Usage Per Thousand checkbox when running this report.

Here are the results for Napkins, an ingredient that I've set to use 300 per $1000 sold.

In this case, because my sales were $1162, my ideal usage was 348.66 napkins.   When I did my physical count, I found that I only used 86 napkins during the period.  I have a positive variance, because I used less than expected.

You can use the buttons at the bottom of this report to Print or export to Excel. 

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