A restaurant’s owner opens the monthly P&L examines sales, skips down to the bottom line and closes the report.
Sound familiar?
The report may be perfectly precise, but if these are the only two figures to be reviewed, most of its value is ignored.
A good restaurant bookkeeping system shouldn’t increase the dependence of proprietors on accountants. They should be more confident of their financials. It’s not necessary to stay up in the dark putting together invoices or master every accounting rule. It’s important to understand why the profit changed as well as what happened to the use of labor and food, and which questions need attention next week.
Bookkeeping Chef’s philosophy is to automate the bookkeeping process that do not require the time of restaurant owners, while providing users with better financial information that they can make use of.
You Should Start By Looking at the Weekly Numbers and Not just Month-End
Restaurants don’t operate on per month. This week, managers are planning their labor. Chefs order food today. Vendors change prices now.
Bookkeeping Chef offers weekly flash reports on the top costs, and monthly financial statements.
The primary cost is comprised of the cost of labor and the purchase of goods and labor, two areas where an establishment can quickly progress. The Bookkeeping Chef’s information notes that the prime cost typically accounts for roughly 60% of restaurant sales.
Imagine that sales have barely changed, but the prime cost rose. This percentage does not provide an answer. It provides the owner with a reason to conduct an investigation.
Did the hourly rate increase? Was there overtime? Did food prices change? Was a vendor invoice unusually high? Have the sales mix changed?
This is a lot more useful than having the same issue after a few weeks.
Let Automation Handle the Repetitive Work
Self-bookkeeping doesn’t mean manually transposing POS figures into spreadsheets.
Automating restaurant bookkeeping can help with repetitive financial data movements. It connects to various systems, including POS Payroll, QuickBooks, POS vendor platforms, inventory and recipe management, and AP/payment tools.
Automating solely for the sake automation is not the objective.
It’s to cut down on manual data entry and ensure that the financial records up-to-date so that owners have the ability to spend time reviewing information instead of making it.
This creates a new model of bookkeeping in restaurants. The software handles more of the mechanics, while the owner is still involved in the financial aspects.
Learn to Ask the P&L Better Questions
If you stop thinking of the P&L as a test it will become less daunting.
Start with sales. Begin with sales. Compare the food and beverage industry’s performance. Consider the labor. Reduce operating expenses and then look at what’s left.
The importance of comparing periods.
Somewhere between these two lines is changing if sales have been increasing, but profits have not. Find out what happened within the organization when food costs grew. Compare staffing with sales to determine if the labor percent has changed. If the number appears odd examine it instead of thinking the restaurant simply had an awful month.
Bookkeeping Chef gives monthly P&Ls that are finalized in five business days. Owners can review the company’s performance without waiting for months to receive financial statements.
For restaurant owners who require bookkeeping solutions, speed can be beneficial however understanding is the greater aim.
DIY Doesn’t Have to Mean Self-Employing Everything
There’s a compromise between delegating all accounting function to a third party and having your own full-time bookkeeper.
Owners are still able to participate in the process of accounting without needing to complete every task by hand.
That might mean the use of automated system connections in order to maintain information flow and analyzing a weekly prime-cost report, looking at the monthly P&L, and asking questions whenever something happens unexpectedly.
Services for bookkeeping in restaurants that focus in catering can assist restaurant owners comprehend the significance of reports by arranging the books and ensuring they are organized.
This does not mean that the bookkeeper is able to perform all bookkeeping functions.
A business owner can engage in a dialogue with the P&L regarding the company.
The aim of financial independence isn’t to create more reports, but to attain financial freedom
Restaurants are a major source of information. Another dashboard isn’t automatically useful.
Value is realized when an employee can open a P&L report, and see that there has been a change and then look at the reports on prime costs.
Bookkeeping Chef’s approach combines restaurant bookkeeping automation, weekly reporting, monthly P&Ls, and restaurant-specific financial support to make that possible.
Automate the repetitive work. Review prime costs every week. Learn to understand the language of your P&L.
You don’t have to be a professional accountant.
Owners who know the financial aspect of their own establishments can make better decisions.