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HA442 : The Class : Food Service Control : Storage : Storage


The Storing Control Point

Food must be stored at the operation in between the time it is received and the time it is put into production. The goal of the operation is to maintain enough stock on an item so they do not run out between deliveries. Deciding which level of each item is a tricky matter. If the operation orders too much of an item they risk deterioration of the product and tying up too much money while they wait to sell the item and get a return on their investment, while if they order too little they run the risk of running out and disappointing guests.

The storage area has its goal of protecting the food service operation's food and non-food purchases until they are needed to serve the guests. To maximize income, profits, and customer satisfaction spoilage and contamination must be minimized. Also, these assets must be protected from theft, pilferage, and unauthorized use.

The key to proper food storage is knowing how items should be stored having facilities and equipment to keep the products in optimal condition while maintaining the proper inventory levels. Keep in mind most food products do not improve in quality while in storage.

The storing function is a weak link in the cost control system of some food service establishments. Many operations experience large losses due to contamination, spoilage, and deterioration of their food products. These losses are usually due to the fact that no one is in charge of monitoring the storage areas. Care must be taken that inventory is rotated to reduce the possibility of spoilage. Although a small business may not be able to justify hiring a storeroom person on a full-time basis, responsibility for the storage areas must be given to one dependable employee (e.g., chef or assistant manager). The establishment's investment in food and nonfood products is too large to be left un-managed.

The responsibilities of the storeroom person vary with the operation and the dollar value of its inventory. (Recall that inventory ties up money but does not earn interest for the business.) In smaller operations, the storeroom person often has other responsibilities such as receiving, issuing, and/or production. Splitting time between these responsibilities need not be a problem if the proper routines are being followed at each of the other control point.

The functions of the storeroom person are:

1. To conduct frequent, careful inspections of product storage areas in the facility

2. To discard food which is contaminated or spoiled

3. To reduce financial losses due to theft and pilferage

4. To monitor rates of usage of each product

5. Notify foodservice personnel of items nearing expiration dates

6. To record inventory dollar amounts using the perpetual inventory and/or physical inventory system

The purpose of the storeroom person's inspections is to ensure that the operation's quality and safety standards are being maintained. Proper care of inventory items contributes to the cost control program also.

Waste in the form of spoilage and decreased product quality increases the &cost of goods sold& expense and decreases profitability. By preserving food properly the storeroom person makes a major contribution to the operation's bottom-line performance.

Unfortunately, thefts and pilferage are not uncommon in the food service industry. However, the establishment of inventory controls can make these losses easier to detect. Security precautions must be taken throughout the operation, and storage areas are no exception. Key and lock control and the establishment of an audit trail are examples of security measures at the storing control point.

There are several good reasons for monitoring product usage rates. First, the information gained in this process can help the purchasing agent to establish par stocks and automatic re-order points, thus minimizing stock-outs. Second, surplus products which are not being used up fast enough can be brought to the attention of the production department. Then these dead inventory items can be worked into production before they spoil, causing the operation's food cost to increase.
Every food service business must keep proper inventory records for accounting and tax purposes.

Storing and Equipment

Equipment is an important consideration in each of the three areas of storage: and refrigerated, and frozen. Storage temperatures in all three of these areas must be monitored with thermometers. A thermometer should be placed in the warmest part of each storage area in a location where it is easily readable. The warmest area in a refrigerator or freezer can usually be found near the door.

Storing and Inventory

Generally, the larger the inventory dollar value, the more difficult is to achieve control of the storing function. While too small an inventory can lead to frequent stock-outs, an excessively large inventory can cause a number of problems. Most food products, including frozen items, experience a loss of volume and quality if stored too long.

Pilferage and spoilage losses tend to increase in direct proportion to the amount of inventory on hand. When employees see a large quantity of products in stock, they may be tempted to steal, figuring that one less will not be noticed. Large inventory amounts encourage waste. Food preparation employees are not as likely to conserve food products that are obviously overstocked.

In light of these problems, managers may wonder how to achieve an optimum inventory level, thus avoiding shortages and overstocking. If sales are properly forecasted, purchasing is more accurate and inventory is easier to control. But suppose an establishment finds it necessary to maintain a large inventory, perhaps due to infrequent supplier deliveries and a high level of sales. Is a detailed security system necessary for every product in stock? Such a system might require a considerably larger storeroom staff, and might actually end up costing more than the losses from thefts, spoilage, and contamination.

Realistically, the dollar value of food products dictates the minimal amount of inventory control necessary to guarantee security. Foods can be compared by price per unit of weight or volume. On this basis, it is clear that relatively few food products have a high dollar value per unit of measure (pound, kilogram, quart, liter, etc.). On the average, less than 20% of the total items in a food service operation's inventory account for over 80% of the total dollar value of the food inventory. Therefore, the operation's inventory control measures should focus on these high cost items.

A physical inventory is an actual count of what is on the shelves. It must be taken each time an income statement is prepared. The physical inventory must be precise and accurate since it is used to calculate the operation's cost of goods sold and food cost percentage.

A perpetual inventory continuously records what is in storage at any given time. As products are added to or removed from storage, the balance is adjusted. At all times, the amount on the shelves should agree exactly with the balance figure on the form. Although the perpetual inventory system requires more record keeping, it offers several advantages. If filled out accurately, the perpetual inventory form provides tight control over food products. Also, unlike the physical inventory method, the perpetual inventory system is always up to date throughout the month. Furthermore, the close monitoring involved in this system prevents food spoilage from progressing uncontrolled in storage areas.

Since most operations have a shortage of personnel resources, the perpetual inventory system is mainly used for expensive menu items such as meat, fish, shellfish, specialty foods, expensive spices and alcoholic beverages. Using the perpetual inventory system for costly items tells employees that these items are being watched.

Another important inventory management technique for preventing spoilage is the rotation of food supplies on a first-in-first out (FIFO) basis. Keeping records on all spoiled food products helps management identify areas for improvement and helps the accounting department maintain accurate values for inventory. During the physical inventory process, management can check each storage area to be sure that the FIFO system is being used. The food production supervisor (usually the chef or assistant manager) should also make a daily FIFO check.

Good housekeeping in dry storage not only reduces contamination, it also reduces fire hazards. The light sources in storage areas should be sufficient to provide adequate illumination for reading product labels. Refrigerated storage areas are designed to maintain food products temperatures of 45'For less. Refrigerators and freezers require visible thermometers so that temperatures can be checked at least four times per day-. Refrigerated storage areas are used to prolong the shelf life of perishable foods so the FIFO system is indispensable.

Frozen storage areas are similar to refrigerated areas except the temperature maximum is O'F . Storage freezers require visible thermometers which should be checked four times each day. Unsafe temperatures or faulty thermometers are to be reported to the food. production supervisor immediately. Most food service operations do not have commercial freezing equipment. Instead most freezers in food service operations are designed to keep already frozen foods frozen. Storage freezers do not freeze foods rapidly but only relatively slowly. It is important to guard against freezer burn (dehydration) or quality deterioration during freezer storage. Careful wrapping of food products is a deterrent to dehydration and quality loss. The food production supervisor should personally inspect each storage area on a daily basis to be sure the operation's food and beverage assets are being protected.

Management's role at the storing control point is twofold: (1) establish the standards and procedures to be followed, and (2) periodically perform a follow-up check to be certain that the standards are being upheld. It is difficult for some employees to break or change old habits which may be counterproductive. However, if they are expected to care about and uphold standards, it must be apparent to them that management cares about the standards enough to enforce them.

A change in storing procedures is necessary when any of the other three control points which precede it are altered. For example, storage area requirements may change drastically when the operation changes from an all-scratch preparation kitchen to the use of convenience foods. More refrigerated and frozen storage areas may be necessary, particularly in an older establishment where refrigerated and frozen storage space may already be inadequate. Product quality and costs are negatively affected if operational decisions are made without considering the resources of the storing control point.

To complete this Topic successfully, please complete the following activities in the order shown below:

ACTIVITY: Evaluation of a storage operation

You should now:

Go on to Issuing
Go back to Food Service Control Points

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