Chapter 2 Flashcards
Advantages of Accurate Sales Forecasts
- Accurate revenue estimates
- Improved ability to predict expenses
- Greater efficiency in scheduling needed workers
- Greater efficiency in scheduling menu item production schedules
- Better accuracy in purchasing the correct amount of food for immediate use
- Improved ability to maintain proper levels of food inventories
- Improved budgeting ability
- Lower selling prices for guests because of increased operational efficiencies
- Increased dollars available for current facility maintenance and future growth
- Increased profit levels and stockholder value
Sales history
Sales history is the systematic recording of all sales achieved during a pre-determined reporting (accounting) period. Sales histories can be created to record revenue, guests served, or both.
Sales to date
Sales to date is the cumulative total of sales reported in the unit.
Average/ mean
An average or mean is defined as the value arrived at by adding the quantities in a series and dividing the sum of the quantities by the number of items in the series.
Fixed average
Fixed average is an average in which you determine a specific time period.
Rolling average
Rolling average is the average amount of sales or volume over a defined but changing time period.
Guest count
Guest count is the term used in the hospitality industry to indicate the number of people you have served.
average sales per guest or check average
Total sales/ Number of guests served= Average sales per guest
Modern POS systems record
- The amount of revenue generated in a selected time period
- The number of guests served
- The average sales per guest
weighted average
A weighted average is an average that weights the number of guests with how much they spend in a given time period.
The weighted average sales per guest for 2 days
（Day 1 sales+ Day 2 sales)/ ( Day 1 guests+ Day 2 guests)
Sales history may consist of
- Revenue, number of guests served, and average sales per guest
- The number of a particular menu item served, the number of guests served in a specific meal or time period, or the method of meal delivery (for example, drive-thru vs. counter sales.)
Sales variances
Sales variances are changes from previously experienced sales levels
Sales this year- Sales last year= Variance
Percentage variance
Percentage variance indicates the percentage change in sales from one time period to the next.
Percentage variance formula
=(Sales this year- Sales last year)/ Sales last year
=Variance/ Sales last year
=Sales this year/ Sales last year- 1
Predicting Future Sales
Managers use sales histories to predict, or forecast, their future revenues, guest counts, or average sales per guest levels.
Revenue forecast formula
Revenue forecast=Sales Last Year + (Sales Last Year x % Increase Estimate)
Revenue forecast= Sales Last Year x (1+% Increase Estimate)
guest count forecast
Guest count forecast= Guest Count Last Year + (Guest Count Last Year x % Increase Estimate)
=Guests Count Last Year x (1.00 + % Increase Estimate)
