Hotel restaurant suppliers: receiving goods, shortfalls at the door and returns

The supplier arrives at seven in the morning through the hotel’s service entrance, the chef is running the breakfast buffet and the storekeeper signs the delivery note without opening a box. At month end the controller asks why food and beverage cost rose two points and nobody can say where. The answer is almost always in that seven o’clock moment: what came in, what did not, and what nobody wrote down.

Why the storeroom entrance decides the month’s cost

Food and beverage cost of sales follows a formula that never changes: opening inventory, plus purchases for the period, minus closing inventory. That result is divided by net food and beverage revenue to get the percentage the controller reports on the departmental statement under the hospitality accounting standard. Now look at the word purchases. Purchases is not what the supplier invoiced: it is what actually entered the hotel’s storeroom and was available to sell.

When the invoice says forty kilos and the scale shows thirty-eight, there are two kilos you paid for and will never sell. If nobody claims them, those two kilos sit inside the month’s cost as if the kitchen had used them. The chef carries a loss that was not his, the controller hunts for waste that does not exist and the supplier got paid in full. That is why receiving is the first cost control in a hotel restaurant, before the standard recipe and before the inventory count.

If you want the detail on how that departmental statement is built, the explanation is in the article on the hospitality accounting standard (What USALI is and why it pays off even with twenty rooms). Here we deal with what happens before: the service door.

The three moments of a purchase

A purchase for the hotel restaurant goes through three separate moments and each one leaves a document. The order, which leaves the kitchen or the storeroom with agreed quantities and prices. The receipt, which is the physical moment when the goods cross the service door and someone checks them. And the invoice, which arrives the same day or days later and which accounting is going to pay.

The most common mistake in a hotel is treating the three moments as one: the invoice is recorded as the purchase and the order and the receipt vanish into a notebook or the storekeeper’s memory. When order, receipt and invoice live in the same system, any difference between them surfaces on its own. You ordered forty, thirty-eight came in, you were invoiced forty: there is a credit note pending for two kilos. Nobody has to remember it.

Who receives in a hotel

In a hotel with a general storeroom, restaurant goods enter through the same store as amenities and linen, and the kitchen then draws them with a requisition. In a smaller property, the chef or the sous chef receives directly. Either scheme works if one rule holds: the person who receives is not the one who ordered nor the one who will pay. The hotel front desk should never sign a food delivery note, even if it is the only one awake at that hour.

Receiving goods: weigh, count, compare

Receiving well is not complicated, but it takes time and a scale. Products sold by weight get weighed: meat, fish, cheese, fruit and vegetables. Products sold by piece or by case get counted: cans, bottles, eggs, sealed packs. And everything is compared against the order, not against the delivery note the supplier brought, because the supplier wrote that note.

• Net weight, without the box or the ice. A fish weighed with ice can carry ten percent water that you will pay for as fish.
• Arrival temperature on chilled and frozen goods. If it arrives out of range, it is refused at the door; once inside the storeroom it is your problem.
• Expiry dates and packaging condition. A dented case of bottles gets opened and counted right there.
• Quality against the specification: shrimp size, chicken portion weight, avocado ripeness. What the kitchen ordered, not what the supplier had on the truck.
• Delivery note price against the agreed price. An unannounced increase is caught at the door, not when the invoice arrives.

Every difference is written down on the spot with the driver present. A shortfall signed by the driver gets charged back; a shortfall discovered the next day in the walk-in is an argument the hotel almost always loses.

Shortfalls at the door: what you ordered and what came in

A receiving shortfall is the difference between what was ordered and what was received in sellable condition. It is not kitchen waste, which happens when trimming and portioning, nor spoilage, which happens when you over-buy. It is the loss that was already on the truck. It pays to separate it by type, because each type has a different exit.

What matters is that a receiving shortfall never becomes a purchase. If thirty-eight kilos came in, the system records thirty-eight, and the missing two stay as an open claim with the supplier until the credit note or the replacement arrives. That way the month’s cost of sales reflects what the kitchen actually had available, not what the supplier chose to invoice.

Returns and credit notes

A return is a claim with an expiry date. If the hotel does not formalize it within a few days, the supplier forgets it and accounting pays the invoice in full because nobody told them otherwise. The procedure is short and it should be the same for every supplier of the hotel restaurant.

1. At the door, with the driver present, write the difference on the delivery note and have the driver sign it. No signature, no claim.
2. Record the receipt in the system with the quantity that actually came in, not the ordered quantity nor the one on the delivery note.
3. Open the claim the same day: quantity, reason, a photo if it helps, and send it to the supplier through the agreed channel.
4. Tell accounting the invoice has an open claim so it is not paid in full.
5. Close the claim when the credit note or the replacement arrives, and link it to the original receipt so the supplier’s history is complete.

With that history, in three months you know which supplier delivers short often, which one changes prices without notice and which one never causes trouble. That information is worth more in an annual negotiation than any volume discount.

An illustrative example with numbers

The figures below are invented to show the calculation. They are not data from any hotel nor industry averages. They only serve to follow the reasoning of how an unrecorded receiving shortfall turns into cost.

In the example, the same hotel restaurant, with the same kitchen and the same sales, reports one extra cost point only because nobody weighed at the door. The chef walks into the meeting to explain waste he did not create. And the extra point repeats every month as long as the supplier keeps delivering short, because nobody is charging him for it.

How the hotel controller sees it

For the controller, the restaurant is one more revenue center inside the hotel, with its own cost and its own inventory. What the controller needs at close is that the month’s receipts match the invoices accounting will pay, that open claims are identified, and that closing inventory is a real count, not an estimate. If those three things are in place, the cost percentage reported is defensible in front of the owner.

When receipts are recorded in the same system where the kitchen consumes and the server sells, the controller sees the whole chain: what came in, what was drawn by requisition, what went out in dishes and what stayed in the walk-in. The controller page (Controller) explains which reports come out of that chain and the kitchen page (Kitchen) shows how it looks from the other side of the door.

What to do this week

1. Put a scale at the hotel’s service door and define who receives on each shift; that person neither orders nor pays.
2. Pick your five highest-value products and start weighing them on every delivery, with the real quantity written on the delivery note.
3. Record receipts by what was received, not by what was invoiced, and open a claim for every difference the same day.
4. Tell accounting about every open claim before the invoice gets paid.
5. At month end, compare invoiced purchases against received purchases and check how much of the month’s cost was really receiving shortfall.

Inn Restaurant records orders, receipts and claims in the same place where the kitchen consumes and the hotel restaurant sells, so the month’s cost counts only what actually came in. If you want to see it with your own suppliers, the fifteen-minute demo is booked on the contact page (contact).