7 Reasons Why Inventory Is So Hard and How to Make it 1000X Easier

Over the past 3 years, we’ve talked to thousands of restaurant managers.

Most agree… they’d rather do just about anything than take inventory.

Count cash…

Schedule servers…

Wipe down the line at the end of the night…

We’re talking anything other than stepping into that stockroom to count.

But why?

Why do most managers want to skip inventory altogether? WHY is inventory just so hard?

We’ve boiled it down to the 7 of the reasons we hear… over and over again… and we’re giving you tricks to make it a whole lot easier. 

Reason #1 – Organizing. Takes. Forever.

Walking into a well-organized stockroom is one thing…

Wait.

Who has a well-organized stock room?

Reason #1 inventory is so hard is that there’s so much work to do before you can even start taking inventory properly. 

Just off the top of our heads, you’ve got to…

  • Get rid of expired ingredients and any items you don’t use
  • Install proper shelving
  • Clean existing shelving
  • Create sections for produce and dry goods
  • Group similar items together
  • Label shelving

All that… before you can even start counting.

Let’s say you try to take inventory without organizing first.

You think you’ve counted all the containers of homemade marinara sauce… but at the end of the night, you find your sous chef stirring up an extra batch.

Looks like you’re recounting it. Or guesstimating.

But you’re just too tired… too busy… and too frustrated to even give two cents.

Instead, like many others, you call it a day.

Not good

If you’re following industry averages, your kitchen area… including all prep and storage space… should be around 40% of your restaurant square footage.

So any way you slice it, that’s a heck of a lot of room for things to get unorganized.

But there are a couple simple ways to fight this…

ORGANIZE AS YOU GO

See an item behind the ice machine that doesn’t belong there? Grab it as you walk by and quickly put it in the right spot. And encourage your staff to do the same thing.

TEAM SWEEP

At the end of each shift, have the staff do a 15-minute sweep of the entire restaurant. Their goal? Look for items that have wandered from their proper storage places… and put them back where they belong.

ANNUAL RE-ORGANIZATION

Take stock of your storage areas once or twice a year. Consider whether there’s a better way to organize your items to make them easier to store… and more efficient to find.

Reason #2 – FOMO Trumps FIFO

If we’re keeping it real… Fear of Missing Out (FOMO) is more powerful than worrying about First In, First Out (FIFO) in the stockroom.

You know that FIFO is important…

But during the lunch rush, first-in-first-out turns into whatever-I-can-get-my-hands-on.

Why?

Rotating stock is tedious and time-consuming… and there are legit reasons why FIFO can go by the wayside.

Servers…

  • Don’t feel like it’s their job
  • Don’t understand how following FIFO will benefit them
  • Think time spent in the backroom = lost tips

And managers…

  • Often don’t have time
  • Need to help servers and cooks during rush times
  • Have money to count… and menus to print… and linens to wash…

Even if your employees want to give FIFO the attention it deserves, they might simply be just too busy during hectic service times.

Whatever the reason employees fail to follow FIFO… goods go bad (10% of all food received by restaurants ends up in the trash)… and a bad inventory count gets worse.

Despite everything that’s stacked against it, there are ways to make FIFO easier to implement.

USE SLOW TIMES TO YOUR ADVANTAGE

The times when the restaurant is slow, say at the beginning of a lunch shift or the end of a dinner shift, are perfect for implementing FIFO. Managers aren’t as busy and servers won’t be losing tips.

MORE INVENTORY TIME = BETTER BUSINESS

If you’re communicating the importance of inventory taking to your staff, they’ll understand and make FIFO a priority. You won’t have to beg them to help or to do a good job… they’ll know that every minute spent on inventory is more money in the cash register.

And what’s good for the business… is good for their paychecks.

Reason #3 – Untrained Staff

Alright. Let’s say your stockroom is organized, and you’re committed to following FIFO.

You know you can’t do it all alone.

Reason #3 inventory is so hard: Training your team to do it right.

And it’s not only your newbies that need to be trained… it’s your seasoned staff that needs to be retrained, too.

Get this… 2016 was the second consecutive year in which the turnover rate in the hospitality industry exceeded 70%. If you experience the average rate of turnover, you’ll likely lose 7 of your 10 employees by year’s end.

Know what that means?

Now you (or at least somebody on your team) will have to train 7 new people.

And there’s more…

You hire a lot of teens. In fact, 1/3 of all working teens are employed at restaurants.

And they’re not exactly the easiest group to train.

Just saying.

No matter how hard you try, you can’t run from training… especially if you want employees to do inventory right…because deep down, you know inventory needs to be done right.

That means you’ve got to teach:

  • Inventory-taking standards
  • Inventory categories
  • Purchase and issue units
  • Key-inventory figures

Training takes time… and like death and taxes… it’s unavoidable. 

And even after you’ve spent a bunch of time training… there’s the double-checking, the supervising, the question-answering to look forward to.

You’re going to have to make sure inventory is done properly, especially if you’re still using pen and paper to handle your restaurant inventory.

So just how do you get out of the training dilemma?

HAND IT OFF TO YOUR MANAGERS

Pass the training baton to your managers… or even seasoned employees. They know the drill well, and by trusting them with this important task, you’ll show them they’re valued as leaders.

HOLD QUARTERLY TRAINING MEETINGS

Once every few months, hold a company meeting where training on inventory takes center stage. This will cement concepts in the minds of staff who’ve already been trained on its importance.

And it will give new employees a chance to get acquainted with the process.

Reason #4 – Price Lookups Suck

Speaking of time… you’ve counted everything in your organized storeroom.

Sure, it took hours, but now you’ve marked your quantities down on paper.

Next up… price lookups.

Price lookups mean weeding through piles of paper looking at the last price you paid for each and every item… and you’ve likely got hundreds of items in that organized storeroom of yours.

Sound like fun?

Yeah… not so much.

Especially when you consider that, for most restaurant owners, getting these necessary prices means digging through a stack of coffee-stained invoices.

If you’re lucky… no, really lucky… your invoice won’t be caffeine-saturated, and they may even be in some semblance of order in a filing cabinet.

But even if they are… you still have to dig through them by hand.

No small task, for sure.

You know your purchasing decisions affect your COGS and of course your restaurant’s bottom line… so yeah… no wonder painful on-paper price lookups are on this list.

Here are a few ideas for making price lookups less painful.

KEEP ALL YOUR INVOICES IN ONE PLACE

Best way to make price lookups easier… is to keep all your invoices in one place. Take the time to file them away by date right after you get them.

MOVE IT ONLINE

Better yet, we’d suggest moving the entire price lookup process online. Snap pictures of your invoices with the Orderly app. Your prices are automatically updated based on your last invoice price.

So you can say goodbye to price lookups once and for all.

Reason #5 – Data Entry Is For the Birds

Ground beef… chicken wings… lettuce… eggs… counted.

Price lookups? Check.

But you STILL have another task…

Time to type these details into the computer.

That’s right… data entry, baby.

And remember, you don’t just need to type in your quantities and the most recent price lookups.

Added any new items to your inventory?

You’re going to have to insert those into your Excel sheet… manually.

And manual data-entry mistakes happen… a lot. In fact, 90 percent of spreadsheets contain errors.

Which underlines just another reason inventory is just so hard.

So how do you get out of the data entry business?

AUTOMATE IT

To get out of data entry, do what every other small business is doing… automate it. Move your manual processes online and let the restaurant apps out there do the hard work for you.

It will save you hours of time… and hair-tearing-out.

Reason #6 – Calculating Your Numbers Eats Your Time

Let’s bottom line the inventory deal.

Doing inventory is hard for many reasons… yet you know getting those numbers is important for your restaurant’s healthy bottom line.

Figures you get from…

  • Counting inventory along with a trained staff
  • Properly entering counts into your restaurant inventory system
  • Keeping track of current price lookups
  • Hoping your spreadsheet formulas were entered right…

Yeesh… and now you need to interpret those figures and how they should guide your decisions going forward. Can we get a collective…

Damn. This IS hard.

Sure, you’ve got a printout of your COGS, your inventory turns, your prime cost, your gross margins.

But these figures won’t help you at all if you don’t know what they mean… or how they’re trending. 

Is your chef going a bit too heavy on the truffle shavings? No idea.

Does it look like some items might be walking off on their own? Let’s hope not.

Are you over-ordering perishables resulting in avoidable waste? Oh jeez, that Dumpster did look full.

Actually counting inventory might be hard and time-consuming, but using the figures you gather from taking inventory to benefit your restaurant… well… yeah, it’s even harder.

Adding insult to time-sucking injury, the entire inventory process is far from a one-and-done type situation.

Good news is, there’s a pretty simple solution for getting out of this…

LET YOUR PHONE DO THE WORK

Skip pulling out the calculator and figuring out your spreadsheet formulas.

You’ve got a mini-computer sitting in your pocket that can automate the entire process. If you’re getting your numbers with an app, it will do the work for you. You’ll know your Cost of Goods Sold, Usage Reports, Days on Hand and more.

Let your phone do all the hard work.

Reason #7 – It’s Time To Do Inventory… Again?!

Just when you think you’re done… it’s time to do inventory yet again.

(Long…labored…sigh.)

You need to take inventory on a weekly – or at least monthly – basis for the insights to make any difference to your business’ bottom line.

But again… who really has time for this tedious task?

There are so many other demands on your time… and spending 4 hours on the inventory process a week…

… well, it’s just not at the top of your priority list.

But there are ways to make it more likely you’ll take inventory regularly, and they’re pretty simple.

SCHEDULE IT ON YOUR PHONE

If you add inventory to your phone’s calendar as a weekly or monthly event, a notification will pop up on those days reminding you to take inventory. Seems simple, but a lot of people aren’t using this tool.

SCHEDULE IT ON YOUR SHIFT SOFTWARE

Another way to schedule regular reminders for you AND your staff is to include it as a recurring event in your shift scheduling software. It serves a double purpose…

  1. You’ll only schedule trained employees on days when inventory needs to be taken and
  2. Those people will have a reminder they need to complete the task that day.

Win-win.

Does It All Have to Be So Hard?

Some things in life are going to be difficult…

But one struggle you shouldn’t have to deal with is inventory.

And with the new Orderly App, well… You don’t have to.

You can get all the numbers you need by just snapping photos of your invoices and uploading your sales.

Seriously. It’s that simple.

All those counts we talked about? And fudged numbers? And hours spent in the freezer? Gone.

Instead, take more time to focus on everything else in your restaurant. And get numbers that are even more accurate than the ones you’ve had.

No spreadsheets and no data entry. Numbers in half the time.

Make your job easier… check out the Orderly app today.

Orderly

Orderly

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