2 Chapter 2- Manual Calculations and the Technology That Automates Those Calculation
Spreadsheets vs. Technology
You will likely use some level of technology to perform the same calculations we will perform manually in this course, so why is understanding manual calculations necessary?
Technology plays a massive role in modern food & beverage management. Software and AI (Artificial Intelligence) can automate many calculations, making processes faster and reducing errors. However, completing and understanding manual calculations is still crucial for success in the food & beverage industry.
Conceptual Understanding: Manual calculations provide a foundational understanding of the financial concepts behind food & beverage financial technologies. They explain why financial calculations are done a certain way, not just how the software outputs the answer. They empower students to interpret the data effectively and make informed, data-driven decisions. Understanding financial formulas allows you to analyze data, adjust recipes, and make strategic pricing decisions for better profitability. Manual calculations are the building blocks for using technology effectively. They provide a critical framework for understanding financial management in the food & beverage industry. While software automates the process, the human element of analysis, interpretation, and informed decision-making will always be essential.
Software Reliance Issues: Technology can be fantastic, software malfunctions and data entry errors happen, and external factors can disrupt financial systems, but understanding manual calculations will allow you to troubleshoot issues, identify discrepancies, and ensure the software works correctly.
Adaptability: Not all food & beverage operations use sophisticated software. Smaller businesses, pop-up restaurants, or catering events might rely on manual calculations or spreadsheets.
Why do we use spreadsheets for the calculations in this course? Spreadsheets are ideal for calculating recipe costs, including ingredient pricing, portion sizes, and yield. They help determine menu item profitability and identify areas for cost optimization, including menu pricing, inventory management, sales analysis, and financial documents such as income statements, balance sheets, budgeting/forecasting, and cash flow statements.
