How To Calculate Your Restaurant’s Inventory Par Levels | Par Level Meaning

By: KEXY Team
January 20, 2024
News And Tips

Calculating your restaurant’s inventory par level meaning is an integral part of your overall food and beverage inventory management. It is an essential method you can use to create your restaurant inventory list and streamline its quantities on hand on any given day.

Successful businesses have different restaurant inventory categories. Establishing a par value varies, depending on various factors, such as holiday events, changing seasons, or a specific day of the week.

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When you understand the importance of par value and levels, you can identify the best practices around it and develop strategies to implement them in your restaurant effectively. Read on!

The Importance of Inventory Par Levels

Par inventory is an essential tool for your restaurant that impacts your restaurant inventory list and directly impacts the cost of food and your practices to use ingredients in food items you serve.

Using part inventory levels allows you to improve product inventory management and gives you access to control functions. As a result, you can automate or streamline numerous tasks associated with your restaurant’s inventory management.

When you use it as your inventory foundation, you can make significant contributions to profit margins. Not only does par inventory prevent you from worrying about wasted inventory, but it also maintains minimum levels of food and ingredients.

Optimizing par levels mean implementing a just-in-time strategy, leading to a wide range of advantages. For instance, when you implement a par inventory strategy, you can avoid food or ingredients spoilage and prevent “exceeding use-by dates.”

You can use these items immediately to eliminate wasteful and costly uses of revenue. Par inventory also enables you to monitor and control inventory turnover rates and ensure your menus evolve constantly.

So, this empowers you to follow a proactive approach and streamline your customers’ experience, leading to improved overall restaurant reputation. Proper inventory par level management helps you decrease food waste, work with vendors effectively, reduce costs of goods, boost profit margins, and increase customer satisfaction rates. Some of the advantages include:

Less Food Loss

According to FoodPrint, 4% to 10% of food, ingredients, or inventory is wasted before the restaurant staff serves it to the customer. Because you purchase too many ingredients at a time, you end up spoiling your inventory before the food is served to customers. KEXY is a reputable inventory software that can reduce food loss.

Decreased Cost of Goods

If you want to lower the cost of goods, use KEXY and look no further than it because it can streamline your cost of goods. Remember, food costs for a restaurant are between 28% and 35% of the total costs. KEXY can help you decrease the cost of goods by preventing food spoilage or loss.

Automatic Inventory Supply

Not only does inventory management software like KEXY allows for streamlined vendor management, but it also helps you track your food and purchases. The purpose is to manage your purchases and payments to the vendors.

In addition, KEXY provides insights into your restaurant’s supply levels and creates automated processes to streamline food supplies to appropriate quantities. That way, you can avoid waste.

Increased Profits

Optimizing inventory par levels is an excellent way to control ingredients on hand for all recipes and dishes on your menu. The purpose is to control portion size and provide your customers with quality service.

Remember, repeat customers means satisfies customers, which is directly proportional to increased profits. The total cost of food or goods sold is a crucial component for restaurants determining their net profits. Inventory management enables you to decrease waste and lower the cost of goods sold, leading to boosted ROIs.

Calculating Par Inventory Levels

There are two essential requirements for creating a par inventory strategy. First, you need to understand the method for calculating par levels accurately. Second, you must know the product delivery frequency before you start performing the calculation process. That way, you can accurately analyze ingredients usage. The formula for calculating par inventory levels for your restaurant is:

PAR Level = (food inventory used every week + stock buffer) / delivery quantities

It is crucial to know the method of deriving the stock buffer or safety stock buffer. Bear in mind that it is a number that represents the restaurant inventory list or restaurant inventory categories and the amount required for handling an increasing number of customers. The general rule of thumb is that the value is about 20% to 25% of your food stock or inventory used each week.

After calculating the par level, it is time to begin ordering at the levels based on this number or value. It is crucial to execute this correctly to mitigate the risk of lost revenue due to over-ordering or product wastefulness. You may need a backup to execute your strategy for par inventory. Make sure you use a quality backup based on technology to get the job done accurately.

Is it Possible to align Par Levels with Inventory Control?

Yes, it is possible to synchronize and balance inventory control to par levels. Creating a successful par inventory strategy requires you to use inventory software, such as KEXY to manage everything. KEXY allows you to perform efficient management operations of par inventory and get the most out of your data management using automation options.

KEXY can integrate data from all sources and make it accessible to create efficient data analytics levels to maximize the advantages of par-level inventory management. Remember, not all data is meaningful, especially when you want to build the controls and monitor par-based inventory.

Ask yourself: is it more viable to track the number of egg cartons in the fridge or track the number of eggs in each carton? Remember, implementing a par inventory strategy requires you to track inventory by going down to specific units. If your current POS system does not provide this, make sure you integrate it with KEXY.

Using a food and beverage inventory management system allows you to implement a par level strategy to improve your ordering accuracy and control your food costs. You will run out of food items without accurate ordering, forcing you to place orders in a rush. Bear in mind that this can cost you extra from your supplier.

That’s why it is crucial to align your inventory control to par levels. KEXY is one of the most popular and reputable inventory control software, allowing you to perform automated and precise orders to achieve consistent cost levels without any fluctuations.

Final Words

Par inventory is an excellent way to streamline your restaurant inventory list or restaurant inventory categories. It is crucial to have an in-depth understanding of par inventory and know what goes into your building and how you can maintain your strategy for a long time?

Innovative inventory management systems, such as KEXY, integrate with POS systems, allowing restaurant operators to manage their par inventory methods. KEXY makes substantial efforts to introduce new features that will enable businesses to perform more efficient operations in all restaurant areas.

Moreover, KEXY is a state-of-the-art, cutting-edge tool that helps you implement and carry out the best inventory control and management strategies. It is a customizable tool that integrates with a wide range of POS systems, leading to accurate automation of inventory and generating higher returns on investments for your business.

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