A restaurant’s owner opens the monthly P&L, looks at sales, then jumps to the bottom line, and then closes the P&L.
Do these sound like familiar to you?
It might be a completely complete report, however when you only look at those two figures, it leaves the majority of its value to be debated.
Good restaurant bookkeeping shouldn’t make owners more dependent on an accountant. They should be more confident about their numbers. There is no need to be familiar with every accounting rule and have to spend hours completing invoices. It’s important to understand what caused the change in profit in relation to the use of labor and food and which areas require consideration next week.
Bookkeeping Chef is an application that makes bookkeeping easier, meaning owners can concentrate in other activities while receiving better financial reports.
Start With the Weekly Numbers Don’t Just Focus on Month-End
Restaurants don’t operate on per month. The managers schedule the labor for the week. The chef has ordered food for today. Vendors change prices now.
This is the reason Bookkeeping Chef provides weekly prime-cost flash reports in addition to monthly financial statements.
Prime cost includes the cost of goods sold as well as labor. Both of these are major areas that can be swiftly moved in restaurants. The information provided by the Bookkeeping Chef indicates that prime costs usually represent 60 percent of the sales in restaurants.
Imagine that sales barely changed but the prime cost rose. This percentage does not provide an answer. The owner has an excuse to do some investigation.
Has the hourly wage increased? Did overtime take place? The cost of food changed? A vendor’s invoice was unusually high. Are there any changes in the sales mix?
This is much more valuable than discovering the same issue several weeks later.
Automate repetitive tasks
DIY bookkeeping doesn’t have to mean manually transferring POS totals to spreadsheets following service.
Automating the bookkeeping process in restaurants can reduce repetitive data movements. It integrates various systems like POS and QuickBooks payroll vendor platforms and inventory management.
Automating just for the sake of automated is not the aim.
The aim is to reduce the need for manual data entry and to keep financial records current so that owners are able to take more time in reviewing the information instead of assembling it.
That creates a different model of bookkeeping for restaurants: technology handles more of the mechanics while the owner remains engaged with the financial meaning.
You can ask better questions regarding P&L
When you stop treating the P&L like a test, it will become less daunting.
Begin with sales. Next, look at the cost of production. Compare the performance of food and beverages. Take into consideration the labor. See the work.
And, most importantly, compare times.
If the sales rise but the profits aren’t, it is a change between the two. Find out what happened within the organization in the event that food costs went up. Examine sales and staffing levels to determine if the labor percentage has changed. Find any data that seems unusual, instead of just thinking that a restaurant has had a bad week.
Bookkeeping Chef will send monthly P&Ls finalized within five business days. This gives owners an opportunity to review recent results rather than receive financial statements long after the period of operation is over.
Speed is crucial, but the aim is to comprehend.
It’s not necessary to do everything.
There is a happy medium between hiring someone to handle your entire financial functions and becoming your own personal accountant.
You are able to be a business owner without performing all accounting duties by hand.
That might mean making use of automated system connections to ensure that information is flowing by reviewing a weekly prime-cost report, or studying the monthly P&L and asking questions in the event of an unexpected change.
The services of specialized restaurant bookkeeping can support that approach by maintaining the book’s structure while helping the owner know what the reports mean.
It’s not an owner who is skilled enough to perform every bookkeeping function.
An owner can talk to a P&L regarding the business.
The aim of financial freedom is not to generate additional reports, but to reach financial freedom
Restaurants produce a lot of information. A different dashboard won’t be as effective.
The real value is when an employee can look at a weekly report on the prime cost and notice that something changed, then access the P&L and understand the next steps to take.
Bookkeeping Chef’s plan includes financial support for restaurants, weekly reporting and automated restaurant bookkeeping to accomplish this.
Automate repetitive tasks. Review prime cost every week. Learn to understand the same language as your P&L.
You don’t need to be an accountant.
Owners who are knowledgeable about the financial aspects of their own restaurants are able to make better choices.