The aim of this module is to allow students develop an understanding of cost control methodologies and procedures for profitable operations in the food and beverage industry
Importance of Cost control
• Definition of cost control• Costs structure in a food and business operation: fixed costs, variable cost• Link between, purchasing, costs, sales and profit• Links between profit and demand
The control cycle in food and beverage operations
Procurement: the need for purchase specifications and criteria for writing these • Storage: correct conditions, stock rotation, bin cards and valuation techniques, stock • control• Methods of requisition and return • Control : standard recipes, standard portion sizes, capital items and equipment returns *Sale and accounting for sales (NB problems with seasonal cost variations)
Manual and information technology based accounting systems
• Use manual systems to ensure effective stock control and rotation • Discussion of appropriate re-order points for different types of commodity • Software suppliers’ promotional videos on electronic systems available • Need to audit and stock take as well as record stock movements • Control of staff hours worked • Basic departmental (kitchen) accounting
Understanding and application of business mathematics
• Number and numerical operations • Decimals, fractions and percentages • Units of measure• Consumer price index
Calculation and application of costing principles to the production of menu items
• Calculating unit cost and food cost for menu items,• Calculating percentages, VAT, Gross Profit ,selling price and cost of sales, portion costs • The sales Mix, average spend, break- even point analysis• Operating Standards: standard yields, Calculation of yield and yield percentage in relation to food preparation
The fundamentals of budgetary control
• Role of budgeting in a food and beverage operation• Objectives of the food and beverage operation: profit targets, sales volume, Gross Profit, Payroll, Other operating expenses• Influence of the external environment, previous experience,• Preparing a budget• Budget Evaluation and control. • Sales forecasting
Lecturer-led approach for practical applications of costings to production of menu items.
Module Content & Assessment | |
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Assessment Breakdown | % |
Formal Examination | 50 |
Other Assessment(s) | 50 |