Your team doesn't understand why you don't always have everything in stock. "Aren't we a restaurant?" you hear often. The reality is that inventory costs money - money that's tied up in products that might spoil or not sell.
Why inventory costs money
Every euro sitting in your cooler is a euro you can't use for something else. Plus, many products have a short shelf life.
💡 Example of inventory costs:
An average restaurant has €8,000 in inventory:
- Meat and fish: €3,500
- Vegetables and fruit: €2,000
- Dry goods: €1,500
- Dairy and eggs: €1,000
If you had this money in the bank at 3% interest, it would earn €240 per year.
Explaining the spoilage risk
Fresh products have a limited shelf life. Buying too much means waste, and waste is lost profit.
⚠️ Note:
On average, a restaurant throws away 5-15% of its purchases due to spoilage. With €50,000 in annual purchases, that's €2,500-€7,500 in losses.
The balance between inventory and sales
The goal is to have just enough in stock without tying up too much money in products that move slowly. From years of working in professional kitchens, I've seen restaurants fail because they couldn't balance this equation properly.
💡 Example of ABC analysis:
Divide your products into categories:
- A-products: Needed daily (potatoes, onions) - always in stock
- B-products: Needed weekly (certain fish) - limited stock
- C-products: Seasonal/special (truffles, game) - order only
Practical explanation for your team
Explain that every euro we invest in inventory must be earned back. Too much inventory means:
- Money tied up instead of generating returns
- Risk of spoilage and waste
- Less space in the cooler for fresh daily products
- Higher insurance premiums (more value in inventory)
Calculating inventory value
Show your team how much money is actually sitting in your inventory. Count the value of everything regularly.
💡 Calculation example:
Cooler check on Monday morning:
- 20 kg salmon at €22/kg = €440
- 15 kg beef at €18/kg = €270
- Various vegetables = €180
- Dairy and eggs = €95
Total: €985 in inventory for 1 week
When to stock up more
There are times when extra inventory makes sense:
- Holidays: Suppliers are closed, extra busy expected
- Promotions: Supplier offers discount on larger orders
- Seasonal products: Limited availability, good price
- Proven fast turnover: Product guaranteed to sell within 2 days
⚠️ Note:
Only stock up extra if you're sure you'll sell it within the shelf life. A 'good deal' that's half spoiled and thrown away is still a loss.
How do you explain inventory policy to your team?
Show the real costs
Count the value of all inventory together with your team. Show how much money is tied up in products that still need to be sold. This makes it tangible.
Calculate the spoilage risk
Track for a week what gets thrown away and what it costs. Share this with the team so they see that waste comes directly out of profit.
Create an ABC classification
Classify products together: what do we always need (A), what weekly (B), and what only special (C). This makes inventory policy logical and predictable.
✨ Pro tip
Track your top 8 ingredient costs weekly for 3 months to show staff exactly how much money sits idle in storage. Make different team members responsible for specific product groups so they feel ownership of the costs.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
What if guests are disappointed that something isn't available?
Explain that fresh quality is more important than having everything in stock all the time. Offer an alternative that is available.
How often should I count inventory?
Weekly for fresh products, monthly for dry goods. This gives insight into turnover speed and prevents overstocking.
What's a healthy inventory value?
General rule: inventory value equals 1-2 weeks of purchases for fresh products, 1 month for dry goods. With €10,000 in monthly purchases, max €5,000-7,500 in inventory.
What if suppliers have minimum order quantities?
Calculate whether the discount outweighs the spoilage risk. Sometimes a slightly higher purchase price is better than too much inventory that gets thrown away.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
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