What tools can automate inventory reports?
Inventory reports can be automated using restaurant management software, POS integrations, and inventory tracking systems that sync purchases, usage, and sales in real time - eliminating manual entry, reducing errors, and providing accurate data for smarter ordering, costing, and waste control.
The 6 Types of Inventory Management Reports for Restaurants
Overview
Running a restaurant means keeping track of hundreds of moving parts, and your inventory is one of the most important. Every ingredient, bottle, and supply item affects your food cost, profit, and day-to-day operations. Without a clear way to track what's coming in and going out, it's easy to lose money through waste, over-ordering, or missing items.
Inventory management reports help you stay on top of these details. They turn raw numbers into useful information, showing you what you actually use, what gets wasted, and how much your stock is worth. With the right reports, you can see patterns, make smarter purchasing decisions, and control costs before they get out of hand.
Usage Report
A usage report is one of the most important tools for understanding how your inventory is really being used. It shows the amount of each ingredient consumed over a specific time period - usually a week or a month. The basic formula is simple -
Beginning Inventory + Purchases - Ending Inventory = Usage.
This report gives you a clear picture of what's leaving your shelves and being turned into menu items. For example, if you started the week with 50 pounds of chicken, bought 30 more, and ended with 20, your usage would be 60 pounds. That number tells you exactly how much product was used during that time frame.
Tracking usage helps identify problems early. If usage is higher than expected, it may point to portioning errors, over-prepping, or even theft. On the other hand, if usage is lower, you might be overstocking or not selling as much as planned. Both situations can hurt your profit margins.
Regularly reviewing usage reports also helps with ordering. When you know how much of each item you typically use, it's easier to set accurate par levels and avoid running out of key ingredients during busy shifts.
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Variance Report
A variance report helps you see the gap between what should have been used and what was actually used. It's one of the clearest ways to measure how efficiently your restaurant is operating. The "ideal" usage is calculated based on your recipes and sales data - essentially what you expect to use if everything is portioned correctly. The actual usage comes from your usage report, showing the real amount that left your shelves. The difference between the two is your variance.
For example, if your recipes and sales suggest you should have used 40 pounds of cheese, but your inventory shows you used 50 pounds, you have a variance of 10 pounds. That gap represents lost profit. It could come from over-portioning, incorrect recipe entries, waste not being recorded, or even theft.
Monitoring variance helps pinpoint where losses occur. If you consistently see higher-than-expected usage on certain items, you can investigate portion sizes, staff training, or prep procedures. Likewise, a positive variance - using less than expected - may mean portion sizes are too small or items aren't being prepared as planned.
A good practice is to track variance weekly and focus on your top 10 most expensive ingredients. Small percentage changes in these items can make a big difference to your bottom line.
By understanding and acting on variance reports, restaurant owners can improve control, reduce waste, and protect profits - all while keeping food quality consistent across every plate served.
COGS Report
The Cost of Goods Sold (COGS) report shows how much money your restaurant spends on ingredients compared to the revenue those ingredients generate. It's one of the most important reports for understanding profitability. In simple terms, it answers this question-How much does it cost to produce the food you sell?
The basic formula for COGS is -
Beginning Inventory + Purchases Ending Inventory = COGS.
This number represents the total cost of ingredients used during a given time period, usually a week or month. When you divide your COGS by total food sales and multiply by 100, you get your food cost percentage. For example, if your COGS for the week is $5,000 and your food sales are $20,000, your food cost percentage is 25%. Most restaurants aim to keep this number between 25% and 35%, depending on the concept and menu.
A COGS report helps you spot cost fluctuations, identify overpriced ingredients, and evaluate supplier performance. If your COGS suddenly rises, it could mean food prices increased, portions grew larger, or waste is going untracked. Reviewing this report regularly helps keep expenses aligned with your sales goals.
It's also a valuable planning tool. Tracking COGS trends over time allows you to adjust menu pricing, portion sizes, or supplier contracts to protect margins. In short, the COGS report doesn't just show what you spent - it reveals how efficiently you're turning inventory into profit.
Par Level Report
A par level report helps restaurant owners keep the right amount of stock on handenough to meet demand without over-ordering. Par level simply means the ideal quantity of each ingredient or supply you should always have in inventory. It's a target that keeps your kitchen running smoothly and prevents both shortages and waste.
To determine par levels, start by looking at how much of each item you typically use during your busiest week. Then factor in your supplier delivery schedule. For example, if you receive produce deliveries twice a week and usually use 30 pounds of tomatoes, your par level might be 15 pounds per delivery. This ensures you have what you need until the next truck arrives.
A par level report lists each item, its current stock, and whether you need to reorder. If your inventory falls below the par level, it signals that it's time to restock. If it's above, you may be over-ordering or not using ingredients as quickly as expected.
The benefits go beyond avoiding "we're out of that" moments. Maintaining accurate par levels helps you control food costs, reduce spoilage, and free up storage space. It also improves cash flow since you're not tying up money in excess inventory.
When combined with usage and COGS data, par level reports give you a reliable guide for purchasing decisions. They create a steady rhythm in your ordering process, keeping your shelves stocked just right - and your kitchen efficient.
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Valuation Report
A valuation report helps restaurant owners understand the total value of all items currently in stock. It's a snapshot of how much money is tied up in ingredients, beverages, and supplies at any given time. This report is often used for financial planning, accounting, and end-of-month reporting, but it also provides insight into how efficiently inventory is being managed.
The valuation report multiplies the quantity on hand by the unit cost of each item to calculate its total value. When summed up, it shows your total inventory value. For example, if you have 50 pounds of beef at $6 per pound, that item alone represents $300 in stock. Doing this for every product in your kitchen helps you see where most of your inventory dollars are going.
Knowing your inventory's total value helps with cost control. If your valuation is too high, it might mean you're over-ordering or keeping too much on hand, which can lead to spoilage. A lower valuation could indicate stock shortages that risk disrupting service.
Regularly reviewing valuation reports also helps identify slow-moving or obsolete items - products that sit on shelves too long and tie up cash. By tracking valuation trends over time, restaurant owners can balance purchasing, improve cash flow, and plan inventory more effectively.
Waste Report
A waste report tracks everything that gets thrown away, spoiled, or lost during food preparation and service. While it may seem like a small detail, waste adds up quickly - and it directly affects your profits. By recording waste regularly, restaurant owners can see exactly where losses occur and take steps to reduce them.
A good waste report includes the item name, quantity discarded, reason for waste, and date. Reasons might include overcooking, spoilage, spills, expired products, or incorrect preparation. For example, if your kitchen is consistently throwing out overcooked chicken or spoiled lettuce, your waste report will make that visible. This kind of tracking helps you understand if the problem is due to storage, portioning, or staff training.
The real power of a waste report is in spotting patterns. If certain items show up repeatedly, it's a sign to make a change - adjust prep amounts, modify recipes, or review how inventory is rotated. Even small improvements in reducing waste can make a noticeable difference in your food cost percentage.
Waste reports also promote accountability. When employees know that waste is being recorded and reviewed, they're more likely to handle ingredients carefully and follow portion standards. Over time, this creates a culture of awareness and responsibility in the kitchen.
Turning Reports into Smarter Decisions
Each type of inventory report plays a unique role in helping restaurant owners take control of their operations. The usage report shows what's being consumed, the variance report exposes gaps between ideal and actual performance, and the COGS report reveals true food costs. Meanwhile, par level reports keep stock balanced, valuation reports show your total inventory worth, and waste reports uncover the hidden losses that eat into profits.
When these reports work together, they create a complete picture of your restaurant's performance - from the shelf to the sales register. You'll know exactly where money is being made or lost, allowing you to make smarter decisions about ordering, pricing, staffing, and waste control.
Running these reports regularly doesn't just protect margins - it builds consistency, reduces surprises, and supports long-term growth. With the right tools, restaurant inventory management becomes less about guessing and more about accuracy, efficiency, and profit.
Take Control of Your Restaurant Inventory with Altametrics
Managing multiple reports manually can be time-consuming and error-prone. Altametrics simplifies the entire process with automated inventory tracking, COGS calculation, and real-time reporting, all in one platform. Gain instant insights into your usage, waste, and profitability - so you can make better decisions faster.
Streamline your inventory today by clicking "Schedule a Demo" below.
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Frequently Asked Questions
How can waste reports reduce food costs?
By tracking what's thrown away and why, waste reports highlight recurring issues such as spoilage, over-prepping, or cooking errors. Addressing these problems helps lower food waste and improve profit margins.
What is a par level, and how is it calculated?
A par level is the ideal quantity of an item you should keep on hand. It's calculated using your average usage and delivery schedule to ensure you have enough stock without over-ordering.
How often should inventory reports be reviewed?
Most restaurants review usage, variance, and waste reports weekly, while COGS, par level, and valuation reports are typically reviewed monthly. The more frequently you update your data, the more accurate and actionable it becomes.
How does a COGS report affect menu pricing?
Your COGS report reveals how much it costs to produce your menu items. By monitoring these costs, you can adjust prices when ingredient costs rise, ensuring you maintain a healthy profit margin.
