UNIT VI MANAGING F & B OUTLETS - MAINTAINING PAR STOCK LEVELS

MAINTAINING PAR STOCK LEVELS 

One of the most important aspect of MANAGING F & B OUTLETS IS TO MAINTAIN PAR STOCK LEVELS.   Periodic Automatic Replacement (PAR) is a system that figures out the minimum (and optimal) level of any given inventory item that should be on-hand at your restaurant at all times. Par stock is the amount or level of a particular item that must be maintained in inventory between deliveries. In this method, restaurant owners establish a minimum level of inventory required at any particular period of time. They put into account the regular stock usage and any other emergency stock requirement to plan when and how much to order.

When we manage our inventory and par stock, we can 

·         Help  manage our food costs

·         Save money spent on storage

·         Plan our purchases better

·         Plan for unforeseen circumstances

·         Make operations simpler

 For example - To maintain par stock in the establishment for the alcoholic beverages consumed, a standard par stock is a predetermined which includes number of bottles of each item and brand used in a particular bar, and the size of the par stock is calculated to be sufficient to meet the demand for a busy day plus a safety factor.

To calculate the PAR stock for a given item:

 (a) Identify the amount of time between deliveries,

(b) Identify the estimated amount used between deliveries,

(c) Add a “safety factor,” the minimum amount to have in stock in case of unexpected increases in demand or vendor stockouts,

(d) Add the estimated amount used to the safety factor; this is the PAR stock amount, and

(e) Record the PAR stock amount on an inventory control sheet or similar document.

The main purpose of a standard par stock is to help determine the average daily consumption of a bar, to assist with requisitioning, and to promote good control over the stock.  In hotels, having an established par stock and random checking of this par stock is recommended so that the fraud is avoided.

Par stock system for Inventory Control

This is a simple yet effective method of beverage control and it is particularly useful for the smaller type operation where there are few full-time control staff members.

The following points should be noticed:

Ø   The level of par stock is established for each bar, i.e. to establish for each beverage the number of bottles required for a busy day plus a small safety factor. This number is determined to be the stock level to be held in the bar at the beginning if the service each day. To simplify the system only full bottles are counted, partial bottles are not counted.

Ø  The number and type of empty bottles are noted each day, this being the amount and type to be requisitioned for the day.

The industry-accepted formula for calculating PAR level is:

PAR level = (the amount of inventory used each week + safety stock) / number of deliveries each week.

To get the figures for this calculation you’ll need to look at historical inventory usage and come up with an average usage for a week, you’ll have to factor in safety stock for unexpected spikes (which, as a best practice, is around 25 percent of your average inventory usage) and you will need to note the delivery frequency of that product.

Once you have your PAR level, your restaurant can now start ordering inventory strategically. You can order just enough inventory to bring it back up to its PAR level, meaning you’ll have enough product in your restaurant, without the risk of under or over purchasing.

Par Level & Stock: Par Inventory Definition, Formula & Sheet (binwise.com)