The Complete Guide for Managing Your Inventory

We've come a long long way in the hospitality industry. And I'm not talking about the evolution of technology over the last century, I'm talking about the last decade. The tech solutions that are sitting at our fingertips are nothing short of a modern marvel. From trading in your order sheets for mobile ordering platforms to automating your payroll, tech is letting small and large business managers alike sleep soundly every night. Whether they decide to utilize them or not, every restaurant, no matter how big or small, has a toolkit full of shiny tech solutions ready to be put to good use. Today we're going to take a unpack and take a look at one of the many power tools available to your business. That tool is inventory management.

Starting at Square 1

First thing's first, let's dissect inventory management into more digestible sections. Inventory management is the practice of specifying the placement and condition of stocked goods. It's the pinnacle of behind the scenes operations. Everything that happens in the front of the house is undoubtedly a reflection of your inventory management. For restaurants, this means keeping track of how many goods, products, linens, and ingredients you have sitting on your shelves (hopefully not gathering dust). The way you manage your supply network and your handling of production and product stock will all depend on the inventory management system you have in place.

A lot of factors come into play to create a solid inventory management strategy, but there is only one key ingredient; forecasting. Forecasting is how you determine how much stock you'll need by a certain deadline. Mapping out how much inventory you'll need is how you set your par and on-hand levels, par levels being the minimal amount of inventory you should have at any given time and on-hand being the actual quantity available. With forecasting in mind, let's dive into some common practice methods of inventory management.

Best Practices of Decades Past

The good ol' pen and paper. The king and queen of "if it isn't broken, don't fix it." Small business supply managers have been using paper and pen since the dawn of the warehouse because quite honestly, it works. It's a nuisance and a liability, but it works. Although there are a handful of problems with this, the biggest inefficiency is the inability to sync up with your other back of the house operations to create a wholesome inventory management system. You can't sync up pen and paper with finances and CRM which means you can't track trends and deliver more actionable forecasts in the future.

As you grow your business, your warehouse will be growing right there with you. According to this article by Startrack, supply managers will often expand their warehouses but seldom follow through in regards to upgrading their system. Old systems typically can’t keep up with higher demand and increased complexity, and therefore should be replaced. Old systems of course refers to more than just pen and paper, but all outdated solutions that can't keep up with your business scaling.

The Problems

The largest red flag with inventory management is negligence. There are so many consumer-facing priorities that demand your attention, making it extremely easy for your back of the house operations to keep running sub-optimally and collect cobwebs. Adopting a tech solution in the last several years does not mean you're out of the woods quite yet. Just as you have a strategy to address your customers/clients/users needs, your warehouse requires a similar tactical approach. According to Stifel, a financial services holding company, “inventory as a percentage of sales is down from its highs, it’s on the rise from its 2011 low.

U.S. retailers are currently sitting on about $1.43 in inventory for every $1 of sales they make.” A well thought out inventory management system will bring that ratio closer and closer to 1, meaning you'll have less unused inventory on hand and more product going out every week. Interest rates are low, which means the cost of holding inventory is relatively inexpensive, but it's still an avoidable cost that you could be avoiding.

One of the most common methods of supply holding is just in time management (JIT). JIT means receiving the exact quantity you need just as you need it. In theory there isn't much wrong with this practice. You minimize holding costs by always replenishing your supply when you run out and every unit gets used. As you may imagine, JIT requires near-impeccable forecasting lest you run the risk of shorting yourself on a product you need on-hand. On the flip side, it can be just as costly to pile on supply.


  • protection against stock shortages
  • achieving bulk purchasing discounts
  • flexibility with customer demand


  • capacity and storage fees
  • perishable products perishing (hah)
  • unused product

Don't let the list fool you, the cons are far more costly than the potential gains brought forth by the pros. The only thing more inconsistent than people's hair colors these days are consumer's buying habits. Stocking up on products in order to to navigate future demand is essentially saying you have total faith in your consumers to stick with the same preference until you stock up on a new product. Not only does excess storage cost you in inventory fees, but in order to dump all those extra units you'll likely have to push discounts to get them off the floor.

A double-sided cost is just about any supply manager's nightmare. The trick to a substantial and wholesome inventory management system is balance. Having a forecasting formula that lets you track trends and analyze where the market is headed is vital to having a fluctuating amount of supply. Achieving a perfect inventory (every item ordered is sold) is definitely not a task that can be accomplished by implementing any old tech solution, but that doesn't mean you shouldn't try.

Modern Inventory Management

To realize maximum efficiency, you're going to need to integrate your inventory management with some fancy new tech. Today's tech solutions are designed with the small business user in mind. This means accessing an easy to use platform that requires little to not set up, allowing your business to carry on with little lag time. Hospitality and procurement platforms like BlueCart exist to accommodate the needs of a supply manager through offering users a streamlined ordering experience and a robust inventory management feature.

A tool is only good as it's features, so what exactly is available to you with BlueCart's inventory management tool? It all begins with creating as many custom inventory sheets as you need to organize your operations. From there, users can add as many items as necessary to keep track of stock. These sheets are easy to update and eliminate the need for conventional order sheets, allowing you to have total control of your inventory from a single app.

Our robust platform allows users to set par and on-hand levels on the spot. Based on the difference of the par level and on hand value, BlueCart can quickly determine how much of the product you need to re-order. Users can one-click to add the reorder amount directly to your cart, requiring next to no time on your end and opening up your schedule to get face time with the people who matter most, your customers. We haven't forgotten the key ingredient, forecasting. Users have access to detailed graphs showing you inventory levels and trends over time, allowing you to optimize your future inventory levels and lower food waste. The ability to see how your stock fluctuates over time will be crucial in modifying your par levels to reach maximum efficiency.

Care to learn more about the platform? Feel free to check out our website. If you're ready to join the BlueCart family, please head to the front of the line!