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Manual Vs. Computerized Restaurant Inventory: What’s Best?

manual vs. digital bar inventory management
Restaurant Operations, Restaurant Inventory - April 19, 2022 Written By: Krista Dinsmore

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Taking restaurant inventory gives you better oversight over your food and beverage stock levels, helps forecast future demand and reduces food and beverage waste. In essence, well managed inventory makes your business more profitable.

There was a time when all businesses did their inventory manually, but as technology has evolved, new methods have been introduced. In fact, certain technologies - such as Radio-Frequency Identification (RFID) for large operations such as warehouses - have completely automated the inventory process.

While restaurant inventory can’t be completely automated with RFID technology, there are technologies (such as inventory management systems) that can help your business improve the productivity and efficiency of your inventory process, while also gaining actionable insights that help your business grow. 

The method you choose to use will depend on your business size, budget and time constraints. With that in mind, let’s review some of the most common methods for taking inventory and their pros and cons.

Restaurant inventory methods and technologies

  • Card method (manual)

Products are stored together and assigned a card, which is kept with the items. This card includes information about the food or beverage item, where it is stored and how much is on hand. Every time you add or remove items from this group, you add or subtract from the quantity listed on the card.

  • Pen and paper method (manual)

This method uses a single document to track inventory data for all products. Each item, its details, location and quantity are listed on the sheet(s). Whenever an item is added or removed to inventory, you will add the adjustment to the sheet. 

  • Spreadsheet method (manual)

This method is similar to the pen and paper method but incorporates some technology, such as Google Sheets, Numbers or Excel. That being said, this method is still considered manual as you will have to manually enter the data. The upside to using computerized spreadsheets is that there is less risk of losing or damaging sheets and cards.

Restaurant Inventory Spreadsheet Vs. Restaurant Inventory Software

  • Spreadsheet formula method (manual/automated)

This form of restaurant inventory management uses spreadsheets for data collection but you will use formulas to help do calculations. This reduces user errors associated with doing calculations manually and adding them to the spreadsheet. 

  • Restaurant inventory software (manual/automated)

Restaurant inventory management software still requires you to manually enter data but, like a formulated spreadsheet, will do the calculations for you to determine ending inventory and measure performance. One of the biggest benefits of using inventory software over a spreadsheet with formulas is that the software is pre-programmed to do the calculations. This means you don’t have to set it up yourself and you don’t have to worry about formulas being accidentally changed or deleted. Additionally, inventory software usually has built-in reports and other tools to provide you with better insights, as well as reduce the amount of time spent calculating and comparing data.

  • Barcodes / QR Codes

Barcodes and QR codes are popular options in today’s business world. To use this method, a barcode is attached to each item. Once scanned, you will be able to review information about that item and adjust inventory. Barcodes and QR codes help save time tracking inventory, reduce wastage by flagging expiration dates and provide more accurate real-time data. Many restaurant inventory management systems and apps have barcode and QR code count functions. 

Manual Vs computerized inventory solutions

The main benefit of manual inventory management solutions is that they have low implementation costs (pen, paper and spreadsheet software, which most computers have). This makes manual inventory the first choice for many startup restaurants. They are also generally easy to learn.

Manual inventory methods are, however, time-consuming. They also leave more room for error, which can end up costing your business more in the long run. These costs include inventory shrinkage, food wastage and poor forecasting and pricing decisions due to inaccurate records.

Computerized options can be more costly to implement, but they can ultimately save you money in the long run. Firstly, it will reduce the amount of time spent doing inventory, which will reduce labor costs or allow staff to spend more time on revenue-generating tasks. It will also reduce the risk of human error and provide you with more accurate insights into how you can drive profitability. 

It will also provide you insights regarding turnover, seasonality and other performance measures to improve forecasting and planning.

As you can see, each inventory method has its pros and cons. The option you choose needs to meet your specific needs. If you would like to further discuss these options and what is right for your restaurant and bar, contact us today.

Contact your Local Inventory Consultant Today

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A Complete Buyer's Guide to Food & Beverage Inventory Management Systems

With around 25 to 35 percent of a restaurant’s operating budget dedicated to purchasing food (that’s not even taking into account beverage inventory costs for the bar), proper inventory management can significantly improve expected revenue.

To maximize profits you need to improve visibility and control over your restaurant or bar’s inventory. 

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