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2 - Sales Concepts

The document discusses key sales concepts used in the food and beverage industry. It defines monetary terms like total sales, average sale, and average check which are used to evaluate performance. Nonmonetary terms covered include total number sold, covers, total covers, average covers, and seat turnover. These metrics help operators identify trends, inventory needs, and evaluate elements like menu items, promotions, and server efficiency. Understanding these common sales concepts is important for careers in food and beverage management.

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584 views

2 - Sales Concepts

The document discusses key sales concepts used in the food and beverage industry. It defines monetary terms like total sales, average sale, and average check which are used to evaluate performance. Nonmonetary terms covered include total number sold, covers, total covers, average covers, and seat turnover. These metrics help operators identify trends, inventory needs, and evaluate elements like menu items, promotions, and server efficiency. Understanding these common sales concepts is important for careers in food and beverage management.

Uploaded by

shaneedan
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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COST AND SALES CONCEPTS

CHAPTER 1
(Principles of Food Beverage and Labor Cost Controls 9th Edition, Wiley et. al)

Case Study Analysis: A Taste of Tuscany & The Grandview Bistro

SALES CONCEPTS

Sales – revenue resulting from the exchange of products and services for
value.
1. Monetary
2. Nonmonetary

MONETARY AND NONMONETARY SALES

MONETARY TERMS
Total Sales - the total volume of sales expressed in dollar terms.

Total Sales by Category – refers to the total dollar volume of sales for
all items in one category.

Total Sales per Server – the total dollar volume of sales for which a
given server has been responsible in a given time period, such as a meal
period, a day, or a week. Management sometimes uses these figures to
make judgments about the comparative performance of two or more
employees.

Total Sales per Seat – the total dollar sales for a given time period
divided by the number of seats in the restaurant. This figure is most
frequently used by chain operations as a means for comparing sales results
of one unit with those of another.

Sales Price – refers to the amount charged to each customer


purchasing one unit of a particular item. The unit may be a single item (e.g.
an appetizer or an entrée) or an entire meal, depending on the manner in
which a restaurant prices its products.
Average Sale – determined by adding individual sales to determine a
total and then dividing that total by the number of individual sales.

1. Average Check = Total dollar sales divided by the total


number of covers
- Covers in the food industry is also known as the number of
sales or customers.
- Used by foodservice operators to:
a. Compare the sales performance of one employee
with that of another
b. Identify sales trends
c. Compare the effectiveness of various menus,
menu listings, or sales promotions.

2. Average Sale per Server = Total dollar sales for an


individual server divided by the number of customers
served by that individual.
- Used by foodservice operators to:
a. Comparative purposes
b. A better indicator of the sales ability of a
particular individual because, unlike total sales
per server, it eliminates differences caused by
variations in the numbers of person served.
Ex. If the Grandview Bistro had four servers on duty, and Amor, one of the
servers, had 30 customers and total dollar sale of $565 on the Saturday
night of February 13, average sale per server for Amor would be calculated
as follows:
Average sale for Amor = Total sales for Amor divided by the
number of customer for Amor
= $565/30
= $18.83
a. $18.83 would be compared with other servers.
All of these monetary sales concepts are common in the industry and
are likely to be encountered quickly by those seeking careers in food and
beverage management.

NONMONETARY TERMS
Total number sold – refers to the total number of steaks, shrimp
cocktails, or any other menu items sold in a given time period.
- Used by foodservice operators to:
a. Identify unpopular menu items in order to
eliminate such items from the menu.
b. Useful for forecasting sales; helpful in making
decisions about purchasing and production.
c. Make judgments about quantities in inventory and
about sales records.

Covers – a term used in the industry to describe one diner,


REGARDLESS of the quantity of food he or she consumes.

Total Covers – refers to the total number of customers served in a


given period – an hour, a meal period, a day, a week, or some other period.
- Used by foodservice operators to:
a. Compare with figures for similar periods in the
past so that judgments can be made about
business trends.

Average Covers – Total number of covers for a given time period


divided by some other number. (number of hours in a meal period,
number of days the establishment is open per week, or the number of
servers on duty during the time period, et. al.)

Covers per hour = Total covers / number of hours operation


Covers per day = Total covers / number of days of operation
Covers per server = Total covers / number of servers
- Used by foodservice operators or managers attempting to
make judgments about such common questions as:
a. The efficiency of service in the dining room
b. The effectiveness of a promotional campaign
c. The effectiveness of a particular server

Seat Turnover/turnover/turns – refers to the number of seats occupied


during a given period (or the number of customers served during that period)
divided by the number of seats available.

Sales Mix – a term used to describe the relative quantity sold of any
menu item as compared with other items in the same category.
NB! Sales Mix Percentages will be significant when we discuss Menu
Engineering

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