Improve Food Service Department Operations and Reduce Costs

Improve Food Service Department Operations and Reduce Costs:


In the majority of long-term care operations, food is the number one supply expense and therefore, all costs associated with it must be evaluated on a regular basis.  Below are 25 suggestions to help you keep your food service department costs in line and improve operations.


  • Use a purchase order system. 
  • Understand inventory turnover and at what level your categories of products should be at. See our news story on Inventory Turnover.
  • Understand how your distributor prices your account by "markup" or "margin", a big difference in terms of what you pay. Note most operations think they are on "markup" but are actually on "margin" and are therefore paying more.
  • Check and verify all deliveries.
  • Use a scale to weigh appropriate products.  Understand what you are weighing, for example, product or ice.
  • Check prices and verify that you are paying the correct prices. For more information please see our new story on Invoice Price Verification.
  • Use a Group Purchasing Program to help you lower costs.
  • Decide where brand names are needed and where house labeled products can be used.
  • On a regular basis, evaluate products by doing blind cuttings to verify that you are receiving the quality expected and that there is not a better product fit for your operation.
  • On at least a yearly basis evaluate potential distributors.
  • Make sure your distributor advises you of any specials available.
  • Don't be afraid to make changes.
  • Be aware that product theft will cost your operation.  Implement procedures and systems to reduce this risk.
  • Perform intake studies on a regular basis. Understanding what residents are not eating will help lower your food and supplement costs by providing meals that are consumed by the residents.
  • Monitor your meal cost per resident day see how it compares to similar operations.
  • Know your labor cost per resident day and how it compares to similar operations.
  • Employee turnover is a large expense to your operation. Understand how to reduce turnover.
  • Keep informed of training programs to improve knowledge and operations for better resident care.
  • Technology can be a great tool and time saver.
  • Place orders electronically and utilize the reports available to improve your operation.
  • If using a manual tray card system consider upgrading to an electronic version.
  • If the food service department is performing resident care functions manually, consider upgrading to an electronic tool to manage and streamline all the resident care functions in a program like Dietech.
  • Once you have automated your resident care functions use the available reports to help control your costs and implement procedures to improve resident care.
  • Poor production control leads to increased costs.
  • When creating your menu, understand products that can be substituted for one another and which ones are in season or more available as this will help to price out your menu at a lower cost.


We would like to hear from you if you have found other ways to reduce costs or improve operations.  Please send your success stories to and if you would like us to mention your name, we will give you credit for your story on our website. 

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PRIME Services

PRIME Services, from its original roots as a purchasing and consulting company in 1983, has grown into one of the largest group purchasing organizations for nursing homes and assisted living communities across the United States.

Today, PRIME Services has three divisions, all focused on removing costs from the supply chain while increasing operational efficiency. The three divisions are; Group Purchasing and Custom Contracting, Consulting and Purchasing Services (CAPS), and a Technology Division

Be sure to mention you're a PRIME Services member when calling in to ensure you receive additional discounts that are available exclusively to PRIME Services members.


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