Finimpact
How often do restaurants do inventory?

Each restaurant is different, but the majority will check their inventory once or twice a week. Doing full counts when you restock on goods is a good idea to make sure nothing has expired and that all your food is fresh.

How is food cost calculated?

To calculate food cost, calculate the cost of goods sold for a meal, then divide that by the revenue from the final dish.

How much food inventory should a restaurant carry?

Restaurants should keep their food inventory as low as possible. You want just enough to cover your sales, but not so little as to have to turn people away. The less excess inventory you carry, the lower your inventory costs.

What is a good inventory to sales ratio?

A good inventory to sales ratio for a restaurant is between four and eight. That means that you’ll sell through your full inventory between four and eight times a month.

What is the average inventory turnover rate for restaurant food?

Inventory turnover rate is calculated by dividing the cost of goods sold in a period by the average inventory. The average inventory turnover rate for restaurants seems to exist anywhere between  6 to 19.  This is the number of days of inventory before running out of the supply.

Conclusion

About the Authors

TJ Porter

Written by: TJ Porter

Personal Finance Writer

I have in-depth experience in reviewing financial products such as savings accounts, credit cards, and brokerages, writing how-tos, and answering financial questions both simple and complicated.

More about me
Joe Templin

Reviewed by: Joe Templin

ChFC - Charted Financial Consultant

Joe Templin is a Charted Financial Consultant (ChFC), MCEC, CEC, CLU and CAP with well over three decades consulting, coaching, and teaching. He's an author of the Amazon Kindle #1 New Release "Every Day Excellence" and host of The Human Kaizen Podcast.

More about me
Chip Stapleton

Fact-checked by: Chip Stapleton

Finance Manager

Chip Stapleton is a Series 7 and Series 66 license holder, CFA Level 1 exam holder, and currently holds a Life, Accident, and Health License in Indiana. He has 8 years of experience in finance, from financial planning and wealth management to corporate finance and FP&A.

More about me