Chapter 15 - Menu Planning and Purchasing

Importance of food in successful operations | Planning a menu | Sales analysis | Cycle menus | Popularity index | Other cost considerations in menu planning | Three aspects of purchasing | Knowing your needs | What about pre-portioned pre-packaged items? How much should be purchased? Planning your ordering
and receiving | Purchasing procedures | Purchasing forms

An error in planning any of the following processes will cause food costs to rise: purchasing, receiving, storing, preparing, processing, serv­ing or selling. A repeated consistent error in any one of these phases can conceivably put an operator out of business!

Consequently, a competent food service operator must know how (1) to plan a profitable menu, (2) to purchase quality food at eco­nomical prices, (3) to receive and store his food items properly, (4) to control the food issues from the storeroom, (5) to prepare and process foods according to a determined cost and quality, (6) to serve foods attractively and (7) to account for sales of food.

Analyzing the Menu

Planning a menu involves the following:

1.  A careful study of sales information so that the menu will reflect the desire of the guests. Many forms for analyzing menu sales are available on the market, ranging from simple to complex. These may be purchased for an operation, or the operator can design his own form. Some operations use a copy of the menu and as each item is sold, a check is made to indicate how many times that item was sold. Over a very short period of time analyses of sales will tell what the customers want and the prices they are willing to pay. The study will enable the operator to pinpoint and push the popular menu items, remove the less popular items and consequently increase his volume of business.

2.  Once the most popular items have been determined, a method of rotating the menu will have to be decided upon. No matter how much a customer may like breaded veal cutlets he doesn't want to find this item on the menu every day or every Wednesday.

The menu should be limited and varied. To accomplish this variety of menu items on any particular day, most operators base their sequence of menu offerings on an even number of days that are not multiples of seven.

For example, their basic menus are planned 10, 16, 22, 40 or more days in advance. Each day's menu is different. In the case of the 10-day menu plan, if the first day's menu was offered Monday, it would take 12 Mondays before the same menu was offered again to the customer.

3. When an operator learns what the more popular menu items are, he must next figure out a basic rotating pattern to even the load on the kitchen equipment and kitchen personnel. All fried items or all baked items, for example, would not utilize equipment properly.

A roast rib of beef, broiled lamb chops, extender-cooked macaroni, breaded veal cutlet, cold seafood platter, and baked salmon may be decided upon. This will give the guests a variety of foods to select from, keep the kitchen personnel busy, and not overload any piece of equipment.

4.  The day must be considered also (e.g., Friday, fish; Monday, less volume; Sunday, family patrons; holidays), the time, the weather,
quantity, quality, size, grade, the market, the season, refrigeration,
inventory, and the price.

Balancing the Menu

Specialty and fast food restaurants and the typical drive-in have menus which are limited in number. In the drive-in for example, the milk shake, hamburger, hot-dog, fried chicken, and french fries are the big leaders. No attempt is made to offer a meal which is balanced nutritionally or any other way.

The operator of the usual table service, cafeteria, or even counter service restaurant, however, must balance his menu. This requires time, study, imagination, and knowledge of food.

1.  Fill in those items which are run as features or regular items, such as a Key Lime Pie, the standard ice creams, standard juices, steaks, and sandwiches.

2.  Select the entrees so as to achieve variety of meat, fowl, and sea­ food having a variety of preparation methods. A soft dish such as a Beef Goulash, a seafood item such as Broiled Snapper, a fried item such as Porkchops Piquant, and a fowl such as roast chicken would be a minimum menu offering variety. Avoid having more than one entree which is exotic or borderline such as frog legs, kidneys, or tripe.

Select the entrees for several days in advance so that they do not repeat so often as to become monotonous to the guest. Chain organiza­tions fill in many of their entrees for a month in advance, supplemented by seasonal items and good buys.

3. Select the juices, soups, vegetables, salads and desserts, to com­plement the entree. Offer a variety of color in the juice, a heavy and a light soup, a variety of textures and colors in the vegetables, at least two salads with a choice of about three dressings, and a choice of at lease three desserts, perhaps up to 10 on an elaborate menu. Plan so as to avoid overtending the kitchen as regards to equipment and skills of the cooks.

Menu planning is a complicated matter and the beginner should read extensively about it. The book, Profitable Food and Beverage Operations, by Brodner, Carlson and Maschal has several excellent chapters on the subject. Menu planning can be a full time job with consideration given to balancing the menu in terms of shape and con­tour of the food, its color, texture, blandness—sweet, sour, and spicy combinations, richness, fatty content, number of calories, and tem­perature.

The menu gives the operator an opportunity to exercise system as well as ingenuity and artistry. The menu should have new items intro­duced continually and unpopular items withdrawn. Menu planning without system is chaos; without imagination and innovation, boring. The happy compromise gives interest and efficiency. A rotating menu seems to be a good way to attain balance, eliminating the hours of work needed to construct a new menu each day. The fixed menu with a few carte du jour items, and daily specials, is another way of saving time and energy.

Purchasing

Food purchasing is a subject that demands study to get what you pay for. We can think of it as being divided into three phases—

1.  Determining what is required.

2.  Learning the market and getting the best buy for your purposes.

3. Checking on what is received for specification, quality and quantity.

The menu and style of operation determines the best size and kind of food item to buy.

A very successful Los Angeles drive-in features fried fish and speci­fies that the halibut it orders be between 60 and 70 pounds in weight.

A highly profitable sea food specialty house uses only 200 pound swordfish and allows only a plus or minus of 10 pounds in weight. "The size of the fish determines the portion," says this operator, "and we are willing to pay 2 to 3 cents a pound more to get the size we want."

The operator who knows his clientele, knows his prices, and what he is trying to do usually knows the grade he should buy. But he should have reasons for his selection. Do not be like the manager who was recently seen cutting up U.S. Choice sirloin steak for stew meat.

A food management teacher recently remarked that if specifications were drawn up properly it is not necessary to spend a lot of time learn­ing to identify the different grades of meat. She was so wrong! Two weeks after her remarks I was privileged to tour five packing houses in a major Western city. We passed by row after row of hanging beef, all of which had been graded "U.S. Choice." The variations within the grade were tremendous. Some of it was well feathered with fat inside the ribs, beautifully marbled, and well covered with a creamy fat. Others the same, poorly marbled, the fat covering spotty and the spread of the ribs unsatisfactory. A grammar school boy could have noted the differences once he knew what to look for.

Oddly enough, in none of these packing houses was any beef graded "U.S. Prime." It seems that in this Western city no one wants prime meat even though the price be the same as for U.S. Choice.

A restaurateur selecting his own meat in this situation would have been able to get a much higher quality of meat than if he had merely ordered a "U.S. Choice" grade. Actually, the meat graders themselves are quick to agree that there are "grades within grades" of beef, and variation of quality within a grade is inevitable.

As with any purchasing, the restaurant operator must decide what he needs. It would be folly for him to buy Prime beef for hamburgers. Some highly successful operators use Commercial grade of beef for hamburgers, being certain to grind the meat coarsely rather than fine and to get the right proportion of fat into the meat patties.

Pre-fabricated meats are fine for small operations that have high labor costs and limited menus. Larger places are usually money ahead to buy wholesale cuts; as they can well use the scraps and odd pieces for stews, soups and braised entrees.

Most restaurant operators seem to prefer frozen vegetables and use canned vegetables as a reserve supply to back up their service should the frozen items run out. Other operators prefer the canned items. Still others depend upon fresh vegetables during their season.

As restaurant operations become more sophisticated, they will cook vegetables only a few minutes in advance of serving them. This means small quantity preparation continued throughout the serving period. By preparing only small quantities, the big problem of buying only those vegetables which hold up on the steam table will disappear.

In buying detergents, the restaurant operator has only a few guides to go by. Not being a chemist or a detergent specialist, information about the composition of the detergent means little. He may know that the amount of polyphosphates in the detergent largely determines how effective it will be in hard water. He may know that the amount of polyphosphates determines its cost. He can find out the hardness of the water from the municipal water officials. But he still is not certain of which product to buy.

Probably the best test is the practical one—does the detergent do the job? Equally important is the matter of service. Will the detergent representative train the dish machine employees and clean and main­tain the machine? Dishwashing is one of the two or three biggest restaurant problems. Unless the operator understands this problem well, he is wise to consider buying from the detergent company that provides specialized service.

The same principle is true in buying equipment—service for the equipment is probably more important than original cost. Buy a prod­uct for which service and replacement parts are immediately available.

Pre-packaged and Pre-portioned Items

Theoretically the purchase of pre-packaged and pre-portioned foods can be done cheaper on a volume basis than when its cans are fashioned by the individual operator. The food producer who is doing the packag­ing usually has the capital to purchase more specialized equipment than the individual restaurateur can afford. Packaging on a volume basis can be done with specialized personnel and by use of methods which permit greater production per man hour than can be done by the restaurant operator. The cost to the restaurant operator should be less than if he does the packaging and pre-portioning himself. In many cases this is not true, and the restaurant operator must arrive at an accurate cost of doing the job in his own restaurant as compared with the price of the packaged or pre-portioned item.

Restaurant operators have made large savings in some cities by purchasing pre-cooked frozen potatoes. In other places the operator saves money by peeling and cutting the potatoes himself. Commercial mixes unquestionably reduce labor in the restaurant. For example, one USDA-Minnesota Experiment Station found that commercial mixes cut the time of preparation by % for cakes, Vi for cookies and % for biscuits and pie crusts. The cost of the commercial mixes was 20% higher for cakes, 50% more for cookies and biscuits, and 75% more for pie crusts.

The Department of Baking Science and Management at Florida State University did a comparative study of baked items prepared from certain mixes and those similar products prepared by good standard recipes. In every case the mix product was as good or better in taste, and when the cost of labor was carefully computed, the mixes also had an advantage. On the other hand, a series of studies conducted at Pope's Cafeterias in St. Louis showed that the cafeteria's recipes were superior to the mixes. Harry Pope, President of the Cafeterias, con­cluded that it would be economical for the cafeteria's employees to make their own mix during times when employees would otherwise be idle. The mix could be made in fairly large quantities, packed, and marked for quick simple use later. Mr. Pope found the same sort of results when he studied the commercial costs of pre-packaged vs. bulk crackers.

All sorts of ready-mixed and pre-packaged foods are available, and more of them will be so in the future. In each instance comparative costs should be figured for such items and compared with the bulk item, taking into consideration the availability of labor that would otherwise not be used. Dehydrated onions, pre-packaged jellies and syrups, and dehydrated potatoes are a few of such foods which, along with bakery mixes, are becoming widely used in the commercial restaurants, as is pre-portioned meat. Some of these foods may offer advantages; others may not. Automation, the use of electrically con­trolled machinery to perform work, will not solve labor problems in the restaurant industry in and of itself. There will always be a necessity for planning and scheduling labor and a necessity to compare the advantages of one form of purchase against another.

Quantity to Purchase

A food service operator in the South bought a carload of beef, expecting meat prices to rise. He had to rent refrigeration space and pay for moving it in and out of the rented space. He also had to pay insurance costs on the refrigeration and no doubt lost some of the meat through thievery. If meat prices had risen, he probably would have broken even. Instead, meat prices fell, and his little speculation cost his operation more than his annual salary.

Most of us do not have the time to study market trends and make intelligent guesses about whether prices will move up or down. There are some exceptions. A very successful operator in the East buys frozen shrimp in quantities large enough to last him four months. The shrimp is delivered as he needs it so he has no storage, thawing, or spoilage losses.

Frozen shrimp in his area has consistently varied from about 70 cents a pound up to $1.25 a pound, depending upon the season of the year. He buys when it is at 70 cents. He also buys corn oil, turkey, frozen apples, and frozen eggs in quantity.

This operator wisely does not store these items himself but has the vendor deliver them as needed. Items which do not meet the operator's specifications are returned. The vendor has his money, the operator has saved money, and both are happy.

The chain operator can buy in quantity and store the merchandise himself. Usually, however, he is better off to do contract buying, ask­ing for delivery as needed. The large operator, by buying in quantity, can gain about a 3 percent net profit advantage over the individual operator, and that's stiff competition indeed.

The usual restaurant operator is well advised to buy daily, to pay weekly, and to take to heart the thought that "there is no future in futures."

Try to keep everything possible turning over daily or at least weekly. A clean refrigerator and a small supply of stores means finer, fresher food served, less, and fewer headaches.

Ordering and Receiving

Set a time to place all orders and a time to have the goods delivered. If ordering is not planned, there's always something that is overlooked and another telephone call is made—another delivery is necessary— additional expense is incurred both in the operator's time and in the extra delivery. Also, deliveries that come in at all hours of the day break into the work routine of everyone concerned.

One of the most successful restaurant operators in the country orders and receives this way—

1.  He inspects his refrigerators and storerooms by 4 p.m. to see what leftovers should be used on tomorrow's menu.

2.  After incorporating the leftovers into the menu, he itemizes what is needed for tomorrow.

3. At about 6 p.m., just before his evening business, he calls for purveyors and places his orders. The purveyors welcome his "after hours" call because it makes their work easier the next morning.

4.  The next morning the deliveries are made between 8 and 10 a.m.

This plan eliminates second orderings and conserves time taken for receiving. Receiving is accomplished during a specified and predicted period. Each operator can plan thus to fit his own schedule.

To keep the purveyors interested in sending the best food products and the correct amounts, pay vendors' bills at least weekly.

Bankers and others in business to loan money enjoy loaning money at interest. Purveyors, who do not officially get interest on their "loans" to restaurant operators, do not enjoy extending credit over long periods. Unofficially, "interest" is charged. Slow payers are likely to find that they do not get what was ordered, either in quality or quantity.

A friendly customer-purveyor relationship based on good business controls and mutual respect should be maintained. At the same time prices must be compared and all items received, inspected for quality, weighed or counted.

Purchasing Procedures

Mechanics of purchasing are simple or complex depending upon the size of the restaurant and the kind of organization.

Purchasing procedures vary with the item to be bought and are usually divided as follows:

1. Staples and Groceries:

These include all canned, bottled, and packaged items which are relatively not perishable and can be stored without refrigeration. Such items are usually purchased on bid which may be received in writing or over the telephone.

2. Perishables:

These foods include all fresh fruits and vegetables and all meats and dairy products. Since this purchasing is done rapidly, there is no time for written bids ordering is done by telephone after receiving quota­tions from three or more purveyors.

3. Standard Contract Purchasing Items:

Items such as milk, bread, ice cream, and coffee are usually bought from a single purveyor who delivers daily, leaving as much merchandise as is required by the food buyer or restaurant operator. These pur­veyors come as a matter of routine and prices of their products usually remain about the same over a period of time. The "standard orders" are usually not contracted for by written agreement, but may be so made.

Written contracts for large purchases of corn oil, fish, shrimp, canned tomatoes, and other items are becoming more common. By such contracts the restaurant operator agrees to buy a specified amount of the food item over a definite period of time, usually 6 months to a year. The purveyor delivers the merchandise as called for by the operator. The operator usually gets a marked price advantage by buy­ing an item such as shrimp at a time when shrimp are in large supply and at a low in the annual price cycle. The operator has the added advantage of not having to receive all of the food when he makes a contract. The vendor stores the item and delivers it to the operator as he calls for it.

Purchasing Forms

To simplify and speed up the process of purchasing, most restaurants have either printed or mimeographed forms developed to fit their own situation. Larger restaurants give a code number to each food item which aids in bookkeeping and maintaining a system.

Perishable items may be classified as fresh fruits, fresh vegetables, frozen fruits, frozen vegetables, beef, pork, poultry, fish, lamb, veal, and dairy products.

Staples and grocery items may be classified into these groups: Con­diments and seasonings, general provisions and staples (such items as baking soda, cocoa, crackers and gelatin), canned fruits, vegetables, juices, canned fish and sea foods.

For ordering perishable items, a quotation sheet can be drawn up to fit the restaurant. The buyer calls three or four vendors and pencils in the price quotation given by each. He then selects the purveyor who has given the lowest quotation, if he knows that this purveyor will give good service and meet the specifications ordered.

Purchase Order forms for other than perishable items are used in large restaurants.

Here is an example of a form itemizing the various foods which are used regularly by a restaurant:

CODE	DESCRIPTION	UNIT
101	FRESH FRUITS Apples, Cooking	Bx
102	Apples, 88's	Bx
103	Avocados	Fit
104	Bananas	Lb
105	Cantaloupe	Crt
106	Cherries	Lug
107	Grapes	Lug
108	Grapefruit (45's)	Crt
109	Lemons (150)	Bx
110	Limes	Bx
111	Melons, Casaba	Crt
112	Melons, Honey Dew	Crt
113	Melons, Persian	Crt
114	Oranges	Bx
115	Peaches	Bu
116	Pears	Bu
117	Pineapple	Crt
118	Plums	Lug
119	Strawberries	Qt
120	Watermelons	Ea
121	FRESH VEGETABLES Asparagus	Crt
122	Beans, Green	Bu
123	Beans, String	Bu
124	Cabbage	Sk
125	Cabbage, Red	Sk
126	Carrots	Sk
127	Cauliflower	Crt
128	Celery	Crt
129	Celery, Pascal	Crt
130	Chives	Dz
131	Collard Greens	Dz
132	Corn on Cob	Crt
133	Cucumbers	Bu
134	Egg Plant	Bu
135	Endive	Crt
136	Escarole	Crt
137	Garlic	Lb.
138	Kale	Bu
139	Lettuce, Head	Crt
140	Mushrooms	Bskt
141	Okra	Bu

CODE	DESCRIPTION	UNIT
142	Onions, Green	Dz
143	Parsley	Dz
144	Peppers	Bu
145	Potatoes, Idaho	100#
146	Potatoes, Sweet	Bu
147	Radishes	Dz
148	Spinach	Bu
149	Squash, Yellow	Bu
150	Tomatoes	Lug
151	Turnip Greens	Dz
152	Water Cress	Dz

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