Ingredient Inventory and Revenue Optimization of Restaurant Food Sales using Integer Linear Programming

Restaurant businesses require significant revenue generation to finance their operational costs. Without revenue, restaurants will operate under deficits, thus making operations unsustainable. This leads to increased risks of business closure and the inability to service any form of customer demand sustainably. Factors that affect revenue generation for restaurants include but are not limited to the following: capital, the availability and limit of stored ingredients, ingredient costs, customer demand, and food sales. This study used Integer Linear Programming (ILP) to model a simulated restaurant’s monthly revenue sales. Optimal maximization of revenue served as the objective function of the ILP model. On the other hand, considerations in formulating the model’s constraint equations include ingredient usage for each menu item, budget for ingredient purchase, and the monthly sales demand distribution of menu items. The MATLAB software was used to simulate the ILP model. The simulation results provided the optimal ingredient inventory configuration and the required number of sales for each menu item.