Operations Management ~ Intro
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This document provides an overview of an operations management class for culinary students. It introduces the instructor and discusses the class topics, which will focus on business concepts and financial analysis relevant for new culinary professionals. Students will complete a final project planning an imaginary restaurant, including a portfolio with menu, recipes, staffing, and income statement, as well as an oral presentation. Key terms like revenue, expenses, profit, and the components of an income statement are defined.
![Vocabulary Dollars [$] versus Percents [%] $ give meaning to the numbers How much $ you have to pay the bills & how much profit you made. How do you know if it was good enough? You had a profit of $43,974 for the month. What does it mean? % gives numbers meaning Part (Expenses & Profit) ÷ Whole (Revenue). Budgeted 10% profit and made 5%. What does that mean?](https://image.slidesharecdn.com/operationsmanagementintro-100405203838-phpapp02/85/Operations-Management-Intro-20-320.jpg)
Operations Management ~ Intro
- 1. Operations Management ~ Intro Instructor – Will Bohmann New England Culinary Institute AOS Culinary Arts Mod 4
- 2. Instructor & Student Intros Briefly: Intro Any experiences with Financial Analysis What do you hope to get out of this class
- 3. Class Overview We’ll focus on the business concepts, information, and attitudes that are relevant for new culinary professionals entering the food service industry. The key to success, as a culinary professional, is to maximize your business expertise. This course will enhance your capacity to envision, anticipate and orchestrate what will happen in business through the study of the income statement.
- 4. Expectations for the Class Be on time! Casual attire for class is acceptable. Be prepared for “respectful engagement.” Ask questions… if you are wondering, someone else is too.
- 5. Industry Overview Serving Our Nation
- 6. Industry Highlights High annual revenue Largest Employer Growth Food Dollar
- 7. Industry Highlights High annual revenue Largest Employer Growth Food Dollar $566 Billion Dollars
- 8. The Final Project You are planning an 80 seat restaurant. It may be located in Burlington or Montpelier You are open for dinner only. You are open 7 days a week. 2 Parts: Portfolio – Written evidence Presentation – Oral evidence
- 9. The Final Project - Portfolio Review Concept Paper What kind of restaurant will it be? Who is my customer/guest Menu Requirements 3 appetizers 5 entrees 3 desserts 5 beverages Cost Recipes Recipes to include: Plate costs and sub-recipes
- 10. The Final Project - Portfolio Review Menu Surveys At least 25 people Each person must select one app, one entrée, one dessert and one beverage Staffing Guidelines Busy, Average & Slow Shifts Scatter plots – Menu Engineering Income Statement A ten minute Power Point Presentation
- 11. The Final Project - Portfolio Review Things that will help you Exceed Standards: Draw a floor plan Incorporate images that represent your concept (ie. Logo, décor, etc.) Use special paper that would be representative of your concept Print all, or part of your presentation in color Include a separate menu in cover Be creative in the design of the portfolio
- 12. The Final Project - Presentation Review 10 Minute oral presentation Power Point 10 slide minimum Concept Summary Target Market review Menu overview Costing summary Staffing summary Labor costs Survey summary Menu engineering Income Statement Prime costs review Profit or (Loss) review Include extras! Photos of décor Animation Floor Plan Graphs
- 13. Basic Financial Terms & Concepts Vocabulary Formulas
- 14. The Income Statement Income Statement = Profit & Loss = P&L This is a snap shot of how the business is performing financially. It can be generated any time, but usually is done monthly and rolled up into one annual statement. It includes: revenue, expenses and profit
- 15. Parts of the Income Statement – Sales & COGS Sales, or revenue , appear at the top of the income statement. For a restaurant there are two general revenue centers : food and beverage. (sometimes retail) Directly below the sales, appear the Cost of Goods Sold (COGS) . These are also broken down for food and beverage. Below this is Gross Profit – the total sales minus the COGS (Sales – COGS = Gross Profit) Gross profit is sometimes called Gross Revenue
- 16. Parts of the Income Statement – Operating Expenses The second largest operating expense is: Labor Expense . It appears separately just below the COGS Operating expenses are broken down into two categories: Controllables - Fluctuating Fixed – Occupancy costs Profit or (Loss) is the last line on the income statement.
- 17. Income Statement Part / Whole = % or Cost / Sales = Cost % ****** What is the % for each?
- 18. Formulas Part / Whole = % Cost / Sales = Cost % -OR-
- 19. Basic Financial Terms & Concepts Imagine a $1 bill. Every penny that goes into that dollar is a percentage point . So, when we say 30% food cost , we are talking about 30 pennies in a dollar.
- 20. Vocabulary Dollars [$] versus Percents [%] $ give meaning to the numbers How much $ you have to pay the bills & how much profit you made. How do you know if it was good enough? You had a profit of $43,974 for the month. What does it mean? % gives numbers meaning Part (Expenses & Profit) ÷ Whole (Revenue). Budgeted 10% profit and made 5%. What does that mean?
- 21. Income Statement We budgeted a 10% Profit. How did we do?
- 22. … More Vocabulary Revenue Income or Sales NOT PROFIT ! Expenses Money spent on operating our business Profit “ Bottom Line” Money leftover after bills are paid
- 23. The Bottom Line The Bottom Line is the last line of the Income Statement. It is referred to as Net Profit . The process of revenue going through the lines of the Income Statement (expenses) is called Flow Through .
- 24. Read 7 P’s of marketing First draft of your concept Bring rough draft to next class HOMEWORK
Editor's Notes
- #7: Annual Revenu in 2009 – 566 billion Largest private sector employer 13 million (10% of workforce) 1.8 million jobs to be added over next decade 50% of total food dollar
- #8: Annual Revenu in 2009 – 566 billion Largest private sector employer 13 million (10% of workforce) 1.8 million jobs to be added over next decade 50% of total food dollar
- #13: Pass out the final project checklist This is a good time to have the students take a break.
- #18: Activity: Project this income statement on the white board. Give the students 15 min. to figure out the %’s for Sales, Expenses and Profit Work through the answers with them.
- #22: Have a short discussion on budget versus actual and some of the areas they might look at when trying to locate the problem.
- #25: Reading 7P’s of marketing article Give the students the Concept summary outline. Stress the importance of getting the first draft of the concept summary