Club Management - September/October 2007 - (Page 14) Taking inventory for accounting purposes is perhaps the least profitable use of the information. On the other hand, taking inventory for control purposes can result in savings ranging from $10,000 to $50,000 per $1 million in annual food and beverage revenue. or warehouse would spend time looking for something that wasn’t where it was supposed to be. And, of course, time spent taking inventory would be completely eliminated. While the zero inventory scenario might be unrealistic, less inventory equals less theft, less spoilage, less money tied up on the shelves, and more profit. In case after case, private clubs that reduced inventory levels reported increased food and beverage profits. The main thing holding club purchasing and food and beverage directors back from maintaining lowest-possible inventories is the fear of running out. Certainly nobody enjoys telling a member the item they want is unavailable. But in a well-controlled club, this should rarely be the case, even with minimum inventories. Terra S.H. Waldron, CCM, is a CMAA national director and general manager and vice president of Desert Highlands Country Club in Scottsdale, Arizona. Waldron is a believer in low inventory levels, and is not afraid of running out. “We position ourselves with the members as always striving for the freshest possible product,” Waldron says. “We forecast based on previous demand, and we call in advance to inform members of specials we know they liked. Then we keep track of how many orders are available and advise members prior to ordering we have limited quantities of fresh, flown-in product. Members appreciate our dedication to freshness, and this approach allows us to maintain low inventory levels.” Control Objective #2: Frequent Counting of Key Items Stated simply, the more often inventory is counted, the lower food and beverage costs will be. However, since 20 percent of the items purchased represent 80 percent of the food and beverage cost, it makes sense to count that 20 percent more frequently than the other 80 percent. In addition, it is not necessary to extend these inventories since they will not be used for accounting purposes, but rather for control purposes. The simple act of frequently counting this relatively small number of items drives significant savings to the bottom line. Consider some of the ways frequent inventories generate savings. Remember ® TEAK GARDEN and SITE FURNITURE 30 Years of Quality and Design 2007 HD Boutique & Expo Miami, Florida visit booth #1862 166309 Request our Sourcebook 14 339275_Country.indd 1 • CLUB MANAGEMENT ~ www.countrycasual.com ~ 800-284-8325 8/27/07 11:32:57 AM http://www.countrycasual.com
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