Determining Product Depletion and Recipe Costing
Locations can produce and issue recipe products in a variety of ways. A recipe product may be produced at the location that sells it , with or without the use of the Net-Chef Daily Prep module, or it may be received from another location (such as a commissary) and sold as a finished product. This means the recipe would not be made using products in inventory at the selling location, or it may even use products that the location doesn’t stock.
There are two settings in the Recipe Details screen that control how a recipe is depleted and how its cost (Actual and Theoretical) is calculated.
- The POS Decrement setting determines how quantities will be depleted from inventory when a recipe product is sold. If set for “Component”, the individual recipe components equal to a single portion of the recipe will be depleted from inventory. If set for “Item”, a single portion of the recipe will be depleted from inventory as a finished product. The default system-wide setting is found on the recipe header.
This setting also determines how the recipe’s actual cost (based on inventory data in Crunchtime) is calculated. If the recipe is depleted by “Component”, the cost of the ingredients at that location will be used to determine the recipe’s actual cost. If the recipe is depleted by “Item”, the current Issue Cost for the recipe will be used.
- The Production Type setting determines whether ingredients from the location will be used to make the recipe product. If the recipe is acquired from another location (such as a commissary) and sold “as is,” then the Production Type is set for “To Order”. In this case, POS Decrement MUST then be set to “Item” since the recipe will only be sold as a finished product. If the recipe is produced at the location that sells it, the Production Type is set to “Production”; the POS Decrement setting will then indicate whether the components required to make the recipe are depleted during prep or at the point-of sale. This depends on whether the location is using the Net-Chef Daily Prep module. See "Determining the Settings for Net-Chef Prep" for more information.
This setting also determines how the recipe’s theoretical cost (based on sales data from POS) is calculated. If set for “Production”, the cost of the ingredients at that location will be used to determine the recipe’s theoretical cost. If set for “To Order” the current Issue Cost for the recipe will be used. The default system-wide setting is found on the Production tab.
If the Calculate Actual/Theoretical Cost for Recipe Item box is checked, the Actual Cost and Actual/Theoretical Cost reports will display costs for the recipe item (not its components) at all locations. (See the Net-Chef user manual for information about these reports.)
Note: These settings can be configured for individual locations on the "Location" tab of the Recipe Details screen.
Click HERE to see a table summarizing the Production Type and POS Decrement settings.