Restaurant owners open their monthly P&L reports, and look at the sales and then move down to the bottom and close the report.
Do you recognize yourself?
If only these two numbers are examined then the real value is not realized.
It shouldn’t cause them to become more dependent on a accounting firm. It should help them become more comfortable with their own numbers. There is no need to spend long hours completing invoices, or master every accounting rule. You must understand how profit has changed in relation to labor and food costs, and the other questions that must be answered next week.
This is the premise Bookkeeping Chef’s mission: to automate the bookkeeping work which doesn’t require the owner’s time while giving restaurant operators more precise financial data they can use.
Begin With the Weekly Numbers, Not Just Month-End
Restaurants aren’t operating on the basis of a monthly. Managers are able to schedule work this week. Chefs order food today. Vendors change prices now.
That’s the reason Bookkeeping Chef provides weekly prime-cost flash reports along with monthly financial statements.
Prime cost includes cost of goods sold and labor. These are two main areas that are able to move quickly in a restaurant. The information provided by the Bookkeeping Chef indicates that the prime cost typically accounts for around 60% of sales in restaurants.
Think about a situation where sales aren’t changing much however, the cost of prime services are increasing. This percentage isn’t an answer. It gives the owner a reason to conduct an investigation.
Did you notice an increase in hours employed? Did overtime happen? Did food cost move? Did a vendor invoice seem abnormally high? Changes in the sales mix?
This is a lot more helpful than finding the same problem several weeks later.
Automate the repetitive Work
DIY bookkeeping doesn’t have to involve manually transferring POS (point of sale) amounts onto spreadsheets.
Modern restaurant bookkeeping automation can handle much of the repeated transfer of financial information. The service can connect POS systems including QuickBooks, QuickBooks, vendors platforms, recipe and inventory management as well as Payment instruments/AP.
The purpose is not to automate for its own sake.
It is to reduce manual data entry, and keep financial records up-to-date so that the owners are able to spend their time looking over data instead of assembling it.
This is a completely different way of bookkeeping that restaurants use: technology is able to handle more mechanics, while the owner stays engaged with the financial meaning.
Learn to Ask the P&L Better Questions
If you stop thinking of a P&L as a type of test, it becomes less intimidating.
Begin with sales. Then look at the costs required to produce those sales. Compare the performance of food and beverages. Check the cost of labor. Reduce operating expenses and see what remains.
Comparing the time spans is crucial.
If sales increase but profits do not, there is some variation between them. What was the result when food prices rose? Examine sales and staffing levels to determine if the labor percentage has changed. Find out if a figure seems unusual, rather than believing that the restaurant went through an unfavorable time.
Bookkeeping Chef can provide monthly P&Ls which are completed in five days. Business owners can look over the financial performance of their business without waiting for months before receiving financial statements.
Speed is important, however it is important to know.
DIY Doesn’t Have to Mean Self-Employing Everything
It is not necessary to be your own bookkeeper full-time if you want to avoid transferring the entire financial responsibility over to another person.
Owners can remain engaged without having to manually complete every accounting job.
It could involve connecting to automated systems to keep information flowing through, examining a weekly prime cost report, or studying the monthly P&L and asking questions in the event of an unexpected change.
Specialized bookkeeping services for restaurants can aid in this process by organizing the books while helping the owner comprehend what the reports are saying.
It’s not an owner who knows how to do every bookkeeping function.
Owners who are able to sit down and talk intelligently about their business to the P&L will have more success.
The objective of financial freedom is not to generate additional reports, but to be able to live a life of financial freedom.
Restaurants create a lot information. A dashboard doesn’t always make sense.
The real value comes when an operator is able to look at a weekly prime-cost report and recognize that something changed, then access the P&L and understand the next steps to take.
Bookkeeping Chef’s approach combines restaurant bookkeeping automation, weekly reporting, monthly P&Ls, and restaurant-specific financial support to make that possible.
Automate repetitive tasks. Check your prime costs every week. Learn the language used in your P&L.
You don’t need to be an accountant.
Owners who are familiar with the financial aspects of their own restaurants will be able make better choices.