This is the second page in a series on Food Cost Control, following the guidelines set forth in the Forty Thieves of Food Cost article. There will be a total of 7 mini quizzes (some yet to be created), each one being associated with a specific sub-section of the Forty Thieves. This section deals with controlling the Receiving Department. Here is what the Forty Thieves guidelines say:
Receiving
- Theft by receiving personnel
- No system for issuing/tracking credits
- No system for checking in orders
- Billed for items not received
- Invoiced weights different than received weights
- Shipped & billed for items not ordered
- Lack of facilities and/or scales
- Perishable foods left out of proper storage
Theft by the Receiving Crew
This is fairly simple to pull off and can potentially go unnoticed. They receive and check the product in, then stash some for themselves and deliver the rest to your storage areas. If you have a receiving crew then they are frequently at work well before most other staff come in, which makes it even easier to stash something in their car before others will notice.
The way to “keep them honest” is to do a daily spot check of a few items which were delivered that day. Have one of the receiving crew verify with you a few items every day, actually looking at the invoice to see how much was delivered, and visually checking that it is actually in your storage area.
No System for Issuing/Tracking Credits
What happens if the receiving crew rejects a product when delivered, or you are billed for something which did not arrive, or the driver issues a credit of some kind? How are these items tracked? Are you aware of your weekly/monthly credits? Can you easily track down a specific credit if you need to? You should have a system in place which details the following key items:
- The invoice number which the credit correlates with
- The date of the invoice
- The amount of the credit
- The reason for the credit
- The vendor
- Who received it
With these things recorded it is easy to go back and know what happened, when it happened, and who owes you money. You also need a specific place to store only the credits as a group. Don’t lump them together with invoices, keep them in a separate folder. It is also wise to include a copy of the original invoice along with the credit.
No System for Checking-in Orders
You should have a system of protocols in place which your receiving crew follow when receiving deliveries because there are a variety of ways which you can loose money at the receiving dock. Always check the invoice of what is being delivered against a PO or guide of what was ordered, especially if one person does the ordering but someone else does the receiving. It is time consuming, but it verifies that you actually ordered the product which is being delivered. It prevents being delivered and charged for product which you did not order. It also prevents the driver from making a mistake and forgetting some of your order on the truck.
Here are specific things your receiving crew should do before they sing an invoice and let the driver go:
- Check delivered products against the invoice to verify that you have received everything for which you are being billed.
- Check delivery invoice items against an order guide or PO to verify that everything delivered is something which was ordered.
- some vendors will unscrupulously send you extra items, or more expensive items, if they know you don’t pay attention to your deliveries.
- even good vendors will sometime automatically sub an item with something which you don’t want.
- this also allows you to be notified by Receiving if something was ordered but did not get delivered, giving you a heads-up to acquire a needed product.
- Check invoiced weights against actual delivered weights
- this means putting products which are billed by the pound (such as fresh beef or fish ) onto a scale and verifying that the invoice weight is correct.
- Check the temperature of cold and frozen product
- Does your receiving crew use a thermometer to check-in deliveries? They should be. Frozen product isn’t usually a problem, but cold product, especially fresh fish and meat, can be an issue. It should be received at a temperature of 41° or lower. If it is over this temperature then it should be returned to the vendor for improper handling.
Lack of Facilities or Scales
You must have a scale in your receiving area which can verify the weight of items delivered. Invest in one which can handle at least 200 pounds. Your receiving area should also be secure so that other employees or someone off the street can’t simply walk off with product while your one guy is busy doing something. The area needs to be clean and organized, preventing pests from access to product.
Perishable Foods left out of Proper Storage
This seems like a no-brainer, but it is amazing how many times product which should be refrigerated sits at room temp too long while the receiving crew puts away “the easy stuff”, take lunch or other breaks, chat too long with truck drivers, etc. Cold storage products must always have highest priority and should be put away as quickly as possible. No one should be on their lunch break while the fish (cheese, lettuce, whatever) is left to rot on the dock. Schedules and breaks must be organized around the delivery schedule of perishable foods.
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