AVS Catering – Melbourne, Australia

Delaware North Companies Australia purchased a small sports concessions company located in Melbourne, Australia. It consisted of a half dozen Aussie Rules Football Stadiums, the Australian Tennis Stadium, a couple of museum cafeterias, and the Melbourne Zoo. Management was concerned that product cost at the venues was running high and wanted DNC’s PC based back of the house inventory systems to be implemented in the Melbourne venues. I was asked to travel to Australia, live there for three months, and implement these systems in the six largest venues.

I met with AVS’s General Manager at the Australian Football Stadium and explained the purpose of my two week visit to his facility. I explained how the various inventory control software packages worked and how they would help him to manage his business.

Since a large percentage of sales was concessions food and beer, I started with the concessions package. I set up each concessions item with the description, sales price, unit cost, etc. I trained the office manager to enter all purchases into the concessions system when the products were received, spoilage as it occurred, employee meals, and the ending inventory at the end of the inventory period (second and last week of the month). When used properly, the software would calculate product yields, product cost, cost of employee meals, and cost of spoilage.

The next software package that I implemented was the Bar Reports. I set up the Liquor Room, Wine Cellar, and Main Beer Cooler on a perpetual inventory system where the Bar Manager would know by looking at the report how much inventory he had in stock. He could tell at a glance how many bottles of each liquor brand he had in the liquor room, how many bottles of each wine brand he had in the wine cellar, and how many kegs and bottles of beer he had in the main beer cooler.

Each bar was set up on its own bar report. Every bottle of liquor, beer, and wine was tracked from the time it was received from the Vendor into the Beverage Warehouse until it was issued to a bar. At the end of the inventory period, the liquor, beer, and wine was counted in the Beverage Warehouse and in each bar. When the Bar Reports were completed properly, management would know the Liquor Cost Percentage, Beer Cost Percentage, and Wine Cost Percentage at each bar.

The third software package I implemented was the Menu Mix. Each menu item was listed on Cost Specification Sheets, broken down into its ingredients, and the cost of those ingredients were calculated. The selling price and total cost of each menu item was input into the Menu Mix software. Each day, the number of items sold was entered into the Menu Mix. At the end of the month, the Menu Mix software calculated the Theoretical Food Cost Percentage for the items sold during the month. The Dining Room Manager would compare the Theoretical Food Cost Percentage to the Actual Food Cost Percentage on the P&L. Any variance greater than two percentage points was investigated.

The final software package that I implemented was the Food Inventory software. Back in the 1990’s, a lot of Food and Beverage companies were still manually extending food inventories. I set up all food items from the fine dining kitchens and storerooms in the software. Prior to the inventory, I printed count sheets that had all items listed. The counters would enter the counts on the count sheet and the Office Manager would key the counts. When everything was entered, the software would calculate the inventory by Dry Goods, Baked Goods, Dairy, Produce, Meat, Fish, etc, and a Total to record in the General Ledger.

After I had implemented the inventory control software, management had tools in place to detect problems with Food Cost, Liquor Cost, Beer Cost, and Wine Cost. They could isolate the cause of a problem and take prompt corrective action to resolve the issues. As a result, there was a noticeable improvement in Product Cost at the six venues utilizing the software. Once familiar with how the software worked, the Aussies were able to install the software in the remaining venues.

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