Example Of Food And Beverage Cost Course Work

Published: 2021-06-22 12:25:06
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1.A. An increase in electric bill will likely to contribute to the utility expenses of the restaurant. The effect of such is a reduction in sales. For example if the restaurant is making $100,000 in last month and the same with the current month, but an increase in electric bill added $2,000 on expenses. The results will be a reduction in sales of $2,000 or 2% out of the total sales.

1.B. If the increase was due to the increase in kilowatt/hour the same effect of sales reduction will likely to occur. For instance, if the restaurant consumed the same amount of electricity in the second month, there would no effect on expenses and on sales percentage. However, an increase in per unit cost will also command an increase on electricity bill even if the restaurant had the same consumption rate.

1.C. The increase in number of customer served in the restaurant would definitely mean an increase in sales percentage provided that there were no changes made on operation hours. For example, if the normal operation hour is from 8:00AM to 10:00PM and the number of guests increased within those hours, sales will definitely increase. However if they decided to extend operation hours for two hours more, the increase in sales would be marginal because the added two hours of operation will also incur expenses corresponding to the added hours of operations.

2. Electricity consumption in the business is a controllable operating expense. This is because the amount of electricity consumed in the restaurant corresponds to the activities that transpired during operation hours. For example, during slow periods such as after lunch or after dinner the restaurant could switch off a few lights on areas that do not have sitting guests. The crew could lead the guests to sit near the window to utilize the light during daytime. The restaurant could also switch off electricity consuming equipment such as AC unit during cold weather seasons. Such measures would allow the restaurant to save on electricity consumptions, which would significantly contribute to the manager’s goal to achieve a better bottom line.

References

Laube, J. (n.d.). What Every Operator Should Know About Managing the Financial Side of the Restaurant. Retrieved July 12, 2012, from http://www.restaurantowner.com/RN_1.pdf
National Grid (n.d.). Managing Energy Costs in Restaurants. Retrieved July 12, 2013, from http://www.nationalgridus.com/non_html/shared_energyeff_restaurants.pdf

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