In a restaurant, forecasting uses data to predict how much the company can expect in sales over a given period of time. At the macroeconomic level, sales forecasting helps a company set growth objectives and determine its overall profits and revenues. At the microeconomic level, forecasting helps a restaurant plan inventory orders and how many employees need to work each shift to prepare and sell food. An inaccurate sales forecast can result in a waste of funds on labor, inventory, and even restaurant operating expenses.
The better the forecast, the more efficient and effective the food service operation will be. Whether it's to predict income, expenses, the amount of food and beverages that will be needed, or the scheduled working hours. Accurate forecasting also means more efficient production schedules, better purchases, maintaining adequate inventory levels, and inventory rotation. Budgets are more accurate if long-term forecasts fit the objectives, which can result in more dollars available for projects such as facility maintenance and operation growth.
If a restaurant company is effective at forecasting, profits can increase and the customer is also likely to benefit from reducing menu prices and offering better service. This chapter is just a brief introduction to the importance of forecasting and some of the factors that need to be considered. Food service management students will undoubtedly benefit from further study of forecasting methods, models, and strategies. The most common forecasting method is to use the sales volumes of existing products to forecast demand for a new one.
This method is particularly useful if the new product is a variation of an existing one that involves, for example, a different color, size, or flavor. Other initiatives that may affect the forecast are the improvement of the quality of service, the renovation of facilities or “green” initiatives, such as a more sustainable supply, the use of compostable supplies, etc. The initial sales forecast for a new product will involve a lot of guesswork, so you should adjust your forecast as soon as you get the actual sales results. If the forecast of the total number of customers for a given day is set to 1200, the percentage of each main course applies to this total forecast (see the column on the right of the graph above).
In this post, we'll show you everything you need to know about forecasting sales in restaurants, from the reasons to make forecasts to the steps to create accurate forecasts and what you should consider when making forecasts for your restaurant. First of all, because if it's not on your shelf, you can't waste it, forecasting sales can help limit food waste. Foodservice Forecaster is an effort to help catering companies and suppliers work more effectively with each other: suppliers see peaks in demand well in advance, while catering companies have more peace of mind knowing that they will be able to get the supplies they need. Many operations use a concept called the “popularity index” to help predict the quantity of each menu item that will be produced, taking into account a general forecast of the number of customers.
Forecasting won't generate perfectly accurate results every day, but forecasting for restaurants is vital to recognizing trends and responding proactively. Introduction to Food Production and Service by Beth Egan is licensed under an international Creative Commons Attribution 4.0 license, except where otherwise noted. Walmart's innovative work has covered areas such as forecasting, collaborative planning, forecasting and resupply (CPFR), supplier-managed inventory (VMI) and radio frequency identification (RFID). After completing each sales forecast, set it aside and review it again after the time period is over to see how accurate the sales forecasts and inventory projections are.
Segments of education, such as elementary and secondary schools and the food service operations of colleges and universities, must analyze school enrollment, the academic calendar, current participation rates, and even the exact menu offering of the day could change the food forecast. .