Five simple steps to manage your restaurant inventory

Inventory management is one of the most significant skills when operating a restaurant. Nonetheless, not many restaurants owners aware the importance of inventory management.

In today post, PosApp will share with you the significance of inventory management and five steps to improve your inventory management.

If you are planning or running a restaurants, it is impossible to operate your restaurant business smoothly without  effective inventory management as improper inventory management can raw material waste, customer dissatisfaction, budget mismanagement, or internal frauds.

restaurant management

If you are all awared of the essential of inventory management, now I will tell you five steps of an effective inventory management.

Five steps of an effective inventory management

Step 1: Tidying up and classifying  your warehouse

A dirty and messy always leads to employee frustration and of course, double counting. Therefore. Before you check inventory, make sure that you tidy up your warehouse. Firstly, you should categorize items by different groups of food . Next, yo had better label your shelves so that you will not be confused by the time sreaching for a raw materials. In addition, you should create an inventory ID for each item.  Finally, you just need to apply this ID to label your items in a spreadsheet or a piece of software so you and your employees can search the items easily and so that it’s easier to search for items or to moveyour inventory data.


Step 2: Planning a schedule with a cleanning team

Inventory should be done by the time you place new orders, so you do not waste money on items you already have.

After deciding the schedule, you should choose your cleanning team as they had better be the ones whom are in charge of counting inventory or table runners so they are familiar with all the raw materials.


Step 3: Creating a sheet template for inventory

It is better for your restaurant to apply both software and spreadsheet to manage your inventory. In the following table below, we will discuss some important elements that is important to present in an physical inventory spreadsheet.  The spreadsheet will be filled in when your employees do inventory check.  The information and data in the spreadsheet will be input into your POS software so you can manage and customize your inventory in ease. These numbers can be used to inform and validate your restaurant food cost and item inventory by software to make report for your business use.

1 Inventory ID The inventory ID will help to prevent false caused by similar or inconsistent naming convention.  For example, if you buy different types of pork, there will be no confusion if each type of pork is categorized as different inventory ID.
2 Time period EX: weekly: March 5 – 21
3 Food category For instance: meat, protein, dairy product, vegetable, fruit,…
4 Item name Item name will help you quickly identify it in food category
5 Unit of measure (ib, oz,…) Each type of product is measured in different and respective unit. Taking this as example, meat cannot be measured as the same unit with vegetable. One notice is that you should always stick to the unit of measure of the product when ordering instead of changing randomly.
6 Unit cost After establishing unit of measure, you need to input the cost for each unit. One thing to be awared is that you should always track and follow the cost from your suppliers in case you there is any fluctuation. In that case, you will have to update all cost per unit that has bên changed in your inventory spreadsheet.
7 Quantity in stock Quantity in stock is the actual number of the product in your inventory stock. For example, if you order 15 boxes of tissue, nonetheless, on inventory day, there are only 10 boxes of tissues then 10 is the number of quantity in stock that is reflected here.
8 Inventory value The inventory value per item is counted through multiplying your cost per unit by your quantity in stock.  For instance, the inventory value of 10 boxes of five-dollar-tissue is $50 counted as multiplying 10 by 5 for a total of $50.
9 Total inventory value All inventory value line items was added together

Step 4: Creating your restaurant spreadsheet of inventory consumption

The inventory consumption spreadsheet will help report the amount of food your restaurants are wasting, how much of an item you use per day, and how much you are spending for inventory.

When tracking inventory consumption on a day-to-day basis, it means that your are tracking the flow of products that exit your restaurant whether if they were bought or wasted. This way of tracking inventory will prevent the false quantity of raw material order and save on costs.

Step 5: Automating your inventory proccess  by POS

You should invest in a POS that allows inventory tracking and manipulate sall sorts of ways which can help your business. Spreadsheets are very important, nevertheless, you should consider owning a POS that helpx handles inventory tracking instead of depending on it too much. Nowadays, many successful restaurants owners exploit their inventory data to facilitate their business.


Inventory management is one of the most vital aspects of operating a restaurant. You can run a restaurants or any kinds of business models without efective inventory management. We hope that after this paper, you wil gain some insights on inventory management to apply in you’re your business situation.