Food Cost and Budgets

Discussion in 'Professional Chefs' started by chefboy2160, Jul 18, 2010.

  1. chefboy2160

    chefboy2160

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    Good day all!

    I am wondering how all of you are coping with the economy, your food costs and budgets. I moved to the health care arena 13 years ago and we work on a budget derived from the census at the facility. My current budget is $3.75 per patient day (PPD) . I run a small assisted living with 40 apartments and my only vendor the company allows me to purchase food and supplies from is Sysco with a once a week delivery. This is a very tough dollar amount to make work in this setting as it includes employee meals also which are reimbursed at $1.25 each. My company is consistent for the last three years I have received a nickel a year increase in budget while the food prices have been increasing at a much  faster pace and now I am trying to write a new 7 week rotational menu with good food but at budget!

    I have for the last 3 years had the best budget in the company always being just slightly under but man is this getting harder to do as costs go up.

    I can surely feel for the owner operators and chefs who must continue to stay competitive in this economy in order to have incomes. Also in my case having just one vendor kinda negates the finding better product and better price thing which can be a major part of the food cost control and customer satisfaction.

    What I am doing to keep costs down is most all meat fabrication  (whole turkeys, Top rounds, Pit hams, pork butts) with a bonus of stock and broths as well as leftovers for other meals and soups. Also a lot of scratch baking and cutting up all fruits and salads.

    So how is this lovely economy affecting your world and what are you doing to cope with it? Off to work.................
     
  2. foodpump

    foodpump

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    1) If they cut down on your food budget, the only thing you have to bargain with is to have at least 5 vendors.  If management does not agree to this then you might as well walk away.  I'm dead serious about this.  Be diplomatic as possible about it, but if you only rely on one supplier, you're never going to get the best price, and you will be forced to accept thier prices and increases

    2) Have at least two suppliers for meat, 2 for poultry, 3 for fresh produce, 3 for beverages, two for dry goods and try to make as many inhouse desserts as possible.    There are many good frozen raw dough bread products out there, and proof and bake is fairly straight forward with added advantages of "freshly baked" bragging rights and no minimum bakery orders for delivery.

    3) Take advantage of seasonal produce.  Now is the time to buy in fresh strawbs, blueberries,etc locally and freeze them, in fall you can get onions and potatoes fairly cheap locally and they don't need refirgeration to store.

    4) Most suppliers have "Fresh sheets" or weekly/monthly specials.  Take advantage of these and plan them into your menus.

    5) Try to do as much in-house butchering as posible.  Cost for whole chix fryers might be as low as $3./lb,  cost for portioned breasts is as much as $7/lb.  Save the legs for other items, use the bones for stock.  I regularily render down the fat and skin (i.e. "Schmaltz") to use for sweating aromatics in my soups and sauces.  Same goes for salmon, and you can always make your own ground pork and ground beef.

    Hope this helps, but remember, you can't do anything if you only rely on one supplier....
     
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  3. chefboy2160

    chefboy2160

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    Great pointers for any one trying to save a buck and keep up the quality. Thanks.........
     
  4. foodpump

    foodpump

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    O.K. so you're inbetween a rock and hard place...

    If you really want to make something stick, then you have to pull out the big guns and be prepared to walk away.  You keep a clean kitchen and consistant costs, basically you're very good at what you do, and the natural tendancy for upper manglement is to ask for a 100 bucks when you give them 5 bucks.

    The only thing they understand is money, and this is the route you have to go.

    You have to proove, on paper, that prices for staples have increased as you state, you have to proove, on paper, that your budget has only increased by 5 cents.  Next you have to proove, with non-Sysco  supplier's current price lists, that you can get the same items, or a reasonable replacement, for cheaper than you can get through Sysco.  And I'm guessing that Sysco suplies all the paper products and cleaning products for the kitchen too.......

    Question is, who do you give the report to after you've invested all this time and effort in writing it?

    The big boys make side money by buying in bulk,(i.e. kickbacks) so their first reaction will be that "other suppliers" aren't Sysco and don't meet the Health and quality controls Sysco does. They'll diss your report.

    You immediate boss, the one who probably pays all the Sysco bills, might see things a bit different, it's his money, after all.

    This is where push comes to shove, and if you go through with it, you better have a zillion copies of your resume out there, for back-up purposes.   
     
  5. chefedb

    chefedb

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    Sysco has more then 1 price on every item. It depends sometime at how fast you pay your bills. Sysco is notorious for substituting their Imperial brand for the brand you order ie You order Hellman's they tell you out of stock send you Imperial. Don't accept it send it back if they see they can get away with it they will do it more and more.Call your salesman tell him get the Hellmans bring it right over. He will. Get a price lets say on 16/20 shrimp ask how much a pound.They say lets say $6.95. Ok now ask  how much a pound for 100 Pounds. If he says same price tell him you have to check other sources. Play the game hard because they will do anything they can to make $. So you have to do same. They make more $ by selling you their own brand,so does the salesman.Watch the invoice many times item will go up gradually from previously quoted price  and they wont tell you. I worked for 1 place where I used 500 as is Prime Ribs a week .When I got them down 2 cents a pound it was $400.00 a week or $20800.00 per years. Not a bad hunk of change. Had I paid 3.99 per pound or 4.01 per pound I would have received same ribs..When you buy, make believe money is coming out of your pocket.
     
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  6. chefboy2160

    chefboy2160

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    Ed you hit the nail on the head! "When you buy, make believe money is coming out of your pocket." these are words to live buy as a professional for sure and what a difference it makes for your food cost over the long run as you so aptly pointed out.

    As a young cook I worked for several immigrant owner operators (German, Greek and Italian) all of who made there livings through there restaurants and they were successful in a large part by watching all expenditures closely.

    You are so right that these sales reps will do as much as possible to up there ante and foodpump has given me an old idea. I am going to get price quotes from a couple of meat,fish, produce and bread companies and leave them lying around the office and when the rep comes in I will let her wait for me in there for a little bit so she can snoop through them and then I will tell her we are having a bit of a corporate shake up and we might be able to mix up our purveyors soon for better pricing and quality! Hey maybe she would like to give me an updated price list. I will then start a bi-weekly faxing of highlighted prices compared to Syscos to the corporate office asking when can we start saving the company money and making our clients happier with better quality stuff. Yep, its time to make a few waves..

    Thanks............
     
  7. chef tomain

    chef tomain Banned

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    Ditto. another strategy I use is to work my way up the middle man chain eliminating as many in betweens as possible. On most items its hard to do but if your using lots of (fill in the blank)

    try to get as close to the source as possible to get the cheapest price you can. Another strategy is to call up vendors get cheapest price and then call the other back to see if they can best x price,making them compete against each other. The final solution: Cut back on portions of costly ingrediants and add filler items,

    My mom worked at a nursing home and for Thanksgiving the kitchen would serve 125 patients with two turkeys, dinner consisted of small portion of turkey 1"x1", a pill cup of cranberry sauce, a tblsp of potato and peas. The patient would complain constantly. I though the situation was pretty sick. But as the prevailing corp. view " don't let people get in the way of profits. I would just kick and scream the point you need more money, more money. What are you going to do when the dollar deflates and your $3.75 turns into $1.87. 
     
  8. caterchef

    caterchef Banned

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    /img/vbsmilies/smilies/chef.gifThat is why I liked the Chef's pay rate up north over down south.

    Up north the Chef got a percentage of total sales and a percentage of net. profits.

    He would take a monthly draw on those percentages.

    The owners treated the Chef as a business partner.

    If the Chef did something increase sales he profited from it.

    If the Chef did something to save money he profited from it.

    It is not a system favored by GM's or taught at culinary schools.

    In the south they are treat Chefs like a Kitchen Manager on salary and maybe a bonus.

    It's also why I didn't get along with the Union. I always made more than union scale.

    I don't miss the bad weather up north but, I do miss the smarter Restaurant owners./img/vbsmilies/smilies/smile.gif
     
  9. chefedb

    chefedb

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    Also be careful when buying on contract. Example Sysco again, Bacon contracted price 2.79lb . Pork Market takes a big drop, going price now is 2.49. Contract stlll 2.79.. Easy solution don't buy bacon from them. Buy from 2.49 source. Contract does not say you must buy bacon from them, Also when you buy  on contract you can't take advantage of market prices. On an overall you will save.$. Sysco also cuts deals where your company gets a rebate monthly based on sales.from them.(they collect rebate from broker or manufacturer, higher then what they are giving your company.. If you do volume like I did you go to broker and cut own deals and get great prices..It takes a little time , but it is amazing what you save..Sometimes a broker cuts a product out  and you can buy it all for 1/3 of the usual price.   REMEMBER  Save pennies and they will equal dollars.
     
    Last edited: Jul 22, 2010
  10. chefboy2160

    chefboy2160

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    Now I got it! Yes we have the contracted prices on the ESysco order guide for our company but when using the product search button I see our contracted prices do not follow market trends.We are led to believe by our sales rep that these are what we are supposed to buy but I never see the rebate on my food cost bottom line if we get one at all through this company.

    This facility I am currently with is the smallest operation I have ever run and I have found that smaller operations require much more attention to detail than a larger one does.At my last facility I had an average of $8,000 weekly for food and here I have about $1,000 with very little storage space as in 1 double door refer for protein and 1 single door for produce with only 2 chest freezers and one upright single door unit all which require continual defrosting.

    My dry goods room is smaller than my freezer at my last place and oh how I miss my walk in refer!

    I have been out of the kitchen for the last 6 months due to surgery but I was able to train my fill in and he just does not get it and has run the budget several thousand dollars over mainly by buying break items instead of full cases. Break a case of ham and it costs you 5 dollars more as well as other meats, cheeses, produce and dry good items. You actually can save money by spending more on whole case items and not being charged the break price than trying to keep the current order lower with break items.

    Any other ideas on this little pop stand??????????/ Gotta work and thanks for the input.........
     
  11. foodpump

    foodpump

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    It's my understanding that when a buyer "contracts" a price with Sysco, he must guarantee a minimum amount of the product he will buy for a 6 mth or 12 mth period.  If I know your upper manglement boys, they have probably contracted prices for staples like bacon, tomatoes, veg oil, etc. and are relying on you to "help them" make thier minimum amount guarantee.

    You say your only alotted a once a week delivery, with no other suppliers, and have didly-squat for refrigeration?

    Ai-ya ya yeih-ya yaieh...... 

    I dunno, assuming you had your boss's blessing ( your immediate supervisor, not the Upper manglement boys) could you rent fridge/freezer space from a nearby restaurant?  Or even deal with the devil and buy several month's worth of say, hams, bacon, mayonniase etc. and have Sysco keep them in their warehouse for you?
     
  12. chefbillyb

    chefbillyb

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    Hi Chef, I'm on the other side of the State Northeast from you. What I see in my food service is, the convenience food I use, that used to be labor saving, is no longer affordable. The Convenience food items saved me labor dollars, so it was a win win situation. That gave me a two man kitchen and time to make everything right. Now that I can't afford the luxury of these items, and no longer can afford the labor, I have all the work of 4 people, back on the shoulders of two. It's getting harder and harder to give quality at a low price, something has to give, I guess Its me.............................The best.............Chef BillyB...................P.S
     
  13. chefedb

    chefedb

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    Foodpump   Chef you buy contract, if you have to you do not have to guarantee x amount. Most of them use last years figures as their guide. If they asked me for a guarantee, I would tell them I have to check other purveyors. You gotta play hardball with these guys. I am not saying be dishonest. Just hardball. Example truck drops off something and it is not mine or they did not bill me ,I tell them. This shows them I have ethics, but at same time If their price is high they are shafting me.That is not ethics on their part. Same applies if they send something in NG or bad. I call them up and say "Are we paying you with damaged checks or broken money? No !  then don't send me defective merchandise. they get the hint.
     
  14. gypsy2727

    gypsy2727

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    I have a large list of suppliers...main and alternative

    I would never depend on a twic a week delivery and by one source?...your at their mercy with that route for supplies.

    For example I deal with The Butcher Shoppe 7 day a week delivery 24 hour telephone messaging ...Truck leaves at 5 a.m but if you catch the order desk at 4:30 a.m they'll throw what ya need on there. Building a good repore with suppliers is so key.

    Champage Poultry is the same ...although they do like to speak to you directly at the desk...they'll come up and hand deliver if your really in a jam.I know the original owner as I apprenticed under him at the King Eddie hotel ...he's retired now.

    I love my vegetable supplier ..even though he's a hot head he gives me the lowdown on all prices and I always have two back up 24 hour sources ...one of them being me!

    Build your network of key vendors ...and remember you are the purchaser in this company ...ya gotta play hardball
     
  15. chefboy2160

    chefboy2160

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    Foodpump said

    It's my understanding that when a buyer "contracts" a price with Sysco, he must guarantee a minimum amount of the product he will buy for a 6 mth or 12 mth period. If I know your upper manglement boys, they have probably contracted prices for staples like bacon, tomatoes, veg oil, etc. and are relying on you to "help them" make thier minimum amount guarantee.

    chefboy2160

    My understanding is that since we have contracted with sysco they give us a pricing agreement

    on certain items which shows up on the order guide in red letters which lets the purchaser know that these prices are constant for the year. No reimbursement with this company. No F&B structure either only a clinical registered dietitian to support the skilled nursing facilities. All F&B agreements are made at the regional level which has turned over twice (VP and RD) in the last 2 years and the new people will not be willing to make any decisions which will rock there boat. Typical corporate attitude in this environment I am afraid.

    I did notice when I first came on board that the pricing between this account and my last was quite different. Items cost me a lot less with my previous account where I spent 8 to 9 hundred thousand annually on food versus the 50 thousand I spend now. I also did receive quarterly reimbursements on my food cost per our contract which was a nice boon.

    An example was I bought a case of dinner plates from sysco before I left my last account and 3 months later purchased the same case with this small outfit and paid 40 dollars more!

    Also I was always visited by a sales rep at my last outfit with the RD or VP stopping by a couple times a tear to make sure I was happy where here I have never seen a corporate sysco person and my sales rep is frequently to busy to stop by and I get a quick phone call from the cell in the car. Man I sure do miss the purchasing power of being able to spend bigger money and the cost and customer service benefits it gives you.

    Chef BillyB

    Hi Chef, I'm on the other side of the State Northeast from you. What I see in my food service is, the convenience food I use, that used to be labor saving, is no longer affordable. The Convenience food items saved me labor dollars, so it was a win win situation. That gave me a two man kitchen and time to make everything right. Now that I can't afford the luxury of these items, and no longer can afford the labor, I have all the work of 4 people, back on the shoulders of two. It's getting harder and harder to give quality at a low price, something has to give, I guess Its me.............................The best.............Chef BillyB...................P.S

    chefboy2160

    I feel for you man. I have seen the changes as I am old enough to remember when chickens came in whole and broccoli was delivered on ice. It was hard for me at first to start using some of the convienience items but now they have become a major staple in a lot of kitchens. I used to work at a major hotel casino in Reno and before I left the area I had breakfast with the chef who I used to work for and he told me he was purchasing a machine for the pantry which would eliminate 2 FTEs. He told me this machine was set up to where you could dump in cases of potatoes, onions and such and get whatever cut you wanted and that this would pay for itself in under a year.

    I do know that convienence food has lowered the skill level required to work a lot of kitchens

    but in your case it is quite justifiable as a labor saving device until as you say the pricing puts you at a breaking point.

    Ed Buchanan

    Foodpump Chef you buy contract, if you have to you do not have to guarantee x amount. Most of them use last years figures as their guide. If they asked me for a guarantee, I would tell them I have to check other purveyors. You gotta play hardball with these guys. I am not saying be dishonest. Just hardball. Example truck drops off something and it is not mine or they did not bill me ,I tell them. This shows them I have ethics, but at same time If their price is high they are shafting me.That is not ethics on their part. Same applies if they send something in NG or bad. I call them up and say "Are we paying you with damaged checks or broken money? No ! then don't send me defective merchandise. they get the hint.

    chefboy2160

    Maybe just maybe I can play a little hardball with my own corporate people as well as the sysco group. Broken money, I love it, great advice Chef.

    gypsy2727

    I have a large list of suppliers...main and alternative

    chefboy2160

    I used to be able to work that way even in health care (acute care hospitals have the most money) but I have found that the arena I am in now (assisted living) is at the bottom of the food chain as far as care and food is concerned.

    Its sad to see how this health care biz is set up and how profit driven it is. Our regions employees received no pay increases this year due to the economy and not meeting projected profit increases.

    Just a quick note that this is not Sysco bashing in any way but just a lot of frustration at attempting to do the best job with what I have to work with. I sure do miss Rykoff and other companies though...............
     
  16. gypsy2727

    gypsy2727

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    Chickens still come in whole and broccoli still comes in on ice....Sysco is a joke ...sorry I don't waste my time with that kind of nonsence.

                         Good luck playing hardball with Sysco. I would not touch them with a ten foot bat

    All the best

    Gypsy
     
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  17. kuan

    kuan Moderator Staff Member

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    Real world man.  People use SYSCO because the people who write their paychecks say use SYSCO.
     
  18. gypsy2727

    gypsy2727

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    Not in my world ....that sucks so does SYSCO and is totally alien to me I have never and never will have anyone dictate who I should order from and leave me enough rope to hang myself with when it comes to MY food and labour cost and budget. You walk into a job like that and your setting yourself up for failure.

    Make sure you cross all your Ts and dot all your Is before you sign on the dotted line...it all looks so wonderfull from the outside ....then well just read the other threads and you can figure it out
     
  19. foodpump

    foodpump

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    Ahhh.. Gypsy, you know I'm 100% with you on not using Sysco, last business I had Sysco Rep figued he would "love bomb " me and wouldn't get out of my face, got to the point where I threatned the regional Sales manger with a restraining order.

    Problem is, big giants play best with big giants, and dwarves play best with dwarves--they might get along otherwise, but they play best with their own kind.  Sysco is an institutional supplier, and therefore loves institutions like seniors homes, schools, etc, and the place where the original poster is, I believe, has contracted out the food service and related management to an outside company.  This company, I am sure, manages many other similar institutions and can do as they please.  One of the things they can do is play with the big boys like Sysco and US foods, and get volume discounts and contracted prices--Giants playing with giants, screw the individual Chefs at the other end, they're just there to fullfill contract obligations and to keep the payroll dept and acct. dept employed.

    I still get whole fryers by the case- if I order from  a poultry supplier (and in many cases the same supplier Sysco uses), and I get broccoli on ice, if I order from a produce supplier.

    I get a big kick out of my business neighbor down the street, he's a very large Italian importer and retailer of Italian goods : olive oil, tomato products, pasta, etc, I walk past him every day on my way to work, Every morning I see big trucks loading up from his warehouse, Sysco, GFS, and many of the medium and smaller purveyors as well.  I deal direct with my chocolate supplier, and Sysco is there too, buying from him.

    I  love   being a dwarf, won't have it any other way
     
  20. kuan

    kuan Moderator Staff Member

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    Whatever.  Sysco can help when you're big and it can hurt when you're small.

    Maybe go down to 3oz half breasts and marinade it yourself.  This brings the weight up a bit.  Pretoss your salads so you're not having half the dressing come back.  Switch from LCR to whole heads.  Bulk fill your ketchup and mustard bottles too maybe.

    Actually the best thing you can do is to sit down with your rep and cost out the menu.  It's a lot of work but it might really make you realize where your money is going.   Get together with your rep together with your 7 week or even 14 week menu and see what you can work out.  Sometimes you can get a sub at a better price. 

    Whatever you do, try not to buy expensive sugar substitute.  Stick with Sweet and Low or whatever is cheaper.