This article has been initially published on iCHEF’s blog.

As the adage goes, prevention is better than cure. Temptation is literally all around when your workplace is a restaurant, bar or cafe – employees help themselves to “free” food and drinks, and are liable to make friends’ orders complimentary. While these acts may seem harmless in moderation, sometimes fraud is taken up a notch, especially when expensive ingredients are involved. 

Types of theft:

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A customer orders an item and pays in cash. The cashier rings it into the POS system as a cheaper item, pocketing the difference. 

Food theft:

Staff consume food outside of their staff meals, take home food without permission, or give friends and family free food and drinks.

False voiding:

When the customer pays the bill, the employee voids the order instead of closing it and keeps the cash. 

Untracked comping and discounts:

More common in bars, staff give away free drinks or discounts to customers, claiming that they were unhappy with their drinks or had to be appeased for one thing or another. It is difficult to be sure if your staff are drinking at work, giving away drinks/ discounts to friends, or stealing.

Kickbacks/ bribery:

Suppliers might incentivise chefs to order larger volumes of more expensive items than needed. Chefs might even place orders for phantom inventory, for example, seven cases of steak when they only receive two. 

Here’s how to ensure it doesn’t happen on your watch. 

Having good systems in place at your outlet is half the battle won. When everyone is on the same page and proper protocol is enforced, it is much harder for someone to cheat. 

1. Automatic Invoice Processing

At an F&B establishment, you can be receiving food ingredients and other consumables every single day; sometimes multiple times a day. Most restaurants also have more than one supplier for each consumable item. That means a lot of invoices.

Kitchen staff (usually the receivers of such supplies) are usually too busy to enter the amounts charged on the invoice and other details into a data sheet like Excel, so they simply chuck it in a drawer to be dealt with at the end of the month.

As a result a manager or accountant spends a few hours every month going through the invoices and doing data entry. More often that not, little attention is paid to whether the price of the fish is unusually high, or whether the volume of ingredients ordered is the standard amount. 

One way to keep better tabs on your invoices is to use automatic invoice processing. With software like Innovo Invoice, you simply snap a photo of the invoice, and it is instantly read and logged into the system for easy reference later. Having all your data on hand without having to manually enter it means you can use your time to analyse your spending instead and cut down on unnecessary costs.

2. Inventory Management 

Ensure you staff follow strict SOPs when ordering and receiving supplies, and that new supplies are always entered into the inventory system accurately. Check your back-end dashboard on your inventory system often and compare the numbers to the invoices tracked in Innovo42 to make sure they match.

Good POS systems will automatically deduct ingredient quantities every time a dish is sold, so your inventory feature will reflect usage. If the amount in your inventory report does not match what you have in stock, you should investigate why.

Monitor the quantities of ingredients ordered each time and see if it corresponds to your sales trends – is more beef being ordered when beef dishes are becoming less popular? 

Here’s an example of how invoice tracking and inventory management can be used together to reduce costs at your F&B outlet.

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Cheryl Tay is the editor and marketer at iCHEF Singapore. She also manages iCHEF Club, a growing community of F&B owners in Singapore – organising events, an online newsletter and the F&B Entrepreneur Bootcamp, the only regular workshop on opening a new restaurant in the country. In her spare time, she attempts to read every book that’s ever won a literary prize and watches cat videos. Like any proper Singaporean, her love for food runs deep – especially spicy food. Chilli is life.

Posted by:Andreea Serb

Andreea Serb is a Content Marketing Lead at Innovo42. Follow her on Twitter @Andreea_Serb to discover stories and fresh perspectives from the industry.