Food & Beverage Cost Control and Pricing Method

Food & Beverage Cost Control and Pricing Method

Introduction

Effective cost control and pricing strategies are critical for the success of any food and beverage (F&B) establishment. This 2-day intensive training program equips participants with the knowledge and practical tools to manage costs, optimize pricing, and maximize profitability. Covering key areas such as recipe costing, inventory control, menu engineering, and financial performance analysis, this program empowers F&B professionals to make data-driven decisions that enhance operational efficiency and sustainability. Tailored for restaurant owners, managers, chefs, and finance teams, this course blends theory with real-world applications to drive measurable results.

Outcome

By the end of this program, participants will be able to:

- Master Costing Techniques – Accurately calculate food, beverage, and labor costs using industry-proven costing methods.
- Optimize Purchasing & Inventory – Implement effective inventory control strategies to reduce waste, improve supplier negotiations, and enhance cost efficiency.
- Develop Strategic Pricing Models – Apply cost-based, value-based, and competitive pricing techniques to maximize menu profitability.
- Enhance Menu Profitability – Use menu engineering strategies to analyze sales data, adjust pricing, and promote high-margin items.
- Improve Financial Decision-Making – Utilize key financial performance indicators (KPIs) to monitor costs, track profitability, and drive sustainable growth.

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No	Topic	Topic Description
1	Introduction to Food & Beverage (F&B) Cost Control	Definition and Importance of Cost Control Role of cost control in profitability and sustainability Common cost challenges in F&B businesses Key Cost Components in F&B Food cost, beverage cost, labor cost, overheads Fixed vs. variable costs
2	Costing Methods in Food & Beverage	Standard Recipe Costing Developing and using standardized recipes How to calculate cost per portion Costing Methods Actual Costing: Direct calculation based on real expenses Standard Costing: Using pre-determined costs for consistency Activity-Based Costing (ABC): Allocating costs based on actual usage of resources Prime Cost Method: Adding food & labor costs for menu pricing
3	Purchasing and Inventory Control	Effective Purchasing Strategies Supplier negotiation and bulk purchasing Just-in-time purchasing vs. stockpiling Inventory Management Techniques FIFO (First-In-First-Out) vs. LIFO (Last-In-First-Out) Perpetual vs. periodic inventory systems Yield and Waste Management Yield testing and edible portion costing Techniques to minimize waste and spoilage
4	Beverage Cost Control	Beverage Costing Methods Costing alcoholic vs. non-alcoholic beverages Importance of standard drink recipes Loss Prevention in Beverage Service Common frauds in bars and strategies to prevent losses Monitoring pour costs and reducing over-pouring
5	Pricing Strategies for Menu Items	Cost-Based Pricing Cost-plus pricing (adding markup to cost) Prime cost method (considering labor & food cost together) Value-Based Pricing Setting prices based on perceived customer value Creating high-value items with lower costs Competitive Pricing Analyzing competitor pricing strategies Positioning menu prices effectively Psychological Pricing Strategies Charm pricing ($9.99 instead of $10) Bundle pricing for meal deals
6	Menu Engineering and Cost Optimization	Menu Profitability Analysis - Using the Menu Engineering Matrix: Stars (high profit, high popularity) Plowhorses (low profit, high popularity) Puzzles (high profit, low popularity) Dogs (low profit, low popularity) Optimizing the Menu for Profitability Removing low-performing items Enhancing presentation to increase perceived value
7	Financial Monitoring and Performance Analysis	Key Performance Indicators (KPIs) for Cost Control Food cost percentage, beverage cost percentage Gross profit margin, variance analysis Budgeting and Forecasting Setting realistic food and beverage cost budgets Forecasting trends and adjusting pricing accordingly
8	Case Study and Practical Application	Real-life Scenarios and Problem-Solving Analyzing food cost reports and identifying issues Implementing corrective actions Software and Tools for Cost Control Using POS systems, inventory software, and costing spreadsheets