Restaurant owners open the monthly P&L, looks at sales, then jumps to the bottom line and then closes the report.
Do you recognize the sound?
The report may be perfectly accurate, but if those are the only two numbers being reviewed the majority of its value is ignored.
Good restaurant bookkeeping shouldn’t make owners more dependent on an accountant. They should be more comfortable with their own numbers. You don’t need to be an expert in accounting, or to spend at night filling out invoices. You need to understand the way profit has fluctuated, what’s happened to food and labor costs and the issues that need to be answered next week.
Bookkeeping Chef is an application which automatizes bookkeeping, so owners can concentrate working on other tasks while receiving better financial reports.
Don’t stop at Month-End Numbers. Start with Weekly Numbers
Even though restaurants do not operate within a calendar month they must still have a P&L. The managers schedule the labor for this week. The chef has ordered food for today. Vendors change prices now.
The weekly reports on Bookkeeping Chef’s prime-cost report are included with the monthly financial statements.
The main cost is a combination of cost of labor and the purchase of goods, two areas in which restaurants can accelerate its progress. Bookkeeping Chef’s supplied information notes that the prime cost typically accounts for around 60% of sales in restaurants.
Imagine sales haven’t drastically changed however, the cost of prime increases. This percentage doesn’t provide an answer. It gives the person in charge a reason to do some research.
Did hourly labor increase? Did you have extra work? The cost of food changed? Did a vendor invoice seem excessively high? What changes have occurred in the sales mix?
It is much better to discover the issue earlier rather than later.
Automate repetitive tasks
DIY bookkeeping does not have to be done manually by transferring POS (point of sale) totals onto spreadsheets.
Automating the process of bookkeeping for restaurants can eliminate a lot of repeated data movement. The service can connect to systems such as POS Payroll, QuickBooks, POS vendor platforms, inventory and recipe management and AP/payment tools.
The goal is not automation for its own sake.
The aim is to reduce the need for manual data entry and to keep financial records current to allow owners to spend more time looking over the data rather than assembling it.
This has created a new form of bookkeeping in restaurants. The system is able to handle more of the mechanical aspects, but the owner remains involved with the financial implications.
P&L Questions: Learn How to Ask More Effective Questions
When you stop treating the P&L as a type of test, it will become less daunting.
Start by looking at the number of sales. Then look at the costs that are required to generate those sales. Compare the food and beverage efficiency. Examine the cost of labor. Move down through operating expenses and examine what’s left.
Compare periods.
Somewhere between these two lines has changed in the event that sales have increased but the profits haven’t. What did happen when prices for food went up? If the percentage of labor changed, compare staffing and sales activity. Find out if a figure seems unusual, rather than believing that the restaurant had a bad period.
Bookkeeping Chef provides monthly P&Ls that are completed in five business days, giving owners the chance to examine the performance of their business, rather than getting financial statements after the operational period has ended.
Understanding is more important than speed when it comes to owners seeking bookkeeping solutions for restaurants.
There’s no need to handle everything on your own by doing it yourself
It is not necessary to be your own bookkeeper full-time if you want to avoid transferring the entire accounting responsibility to another person.
The owner is able to remain engaged without having to manually complete each accounting job.
This may mean the use of automated systems to keep track of the flow of information, examining the monthly P&L and weekly reports regarding prime expenses or asking questions when something unexpected happens.
Bookkeeping services for restaurants that are specialized in restaurants can help owners to understand the purpose of reports by arranging the books and keeping them organized.
It is very unlikely that you will get an accountant that can do all of the functions.
It’s an owner who can have a conversation with an P&L and engage in a thoughtful discussion on the business.
The aim is financial independence Not more reports
Restaurants already generate huge amounts of data. The dashboards aren’t always making sense.
The true value is when an operator looks at a weekly report on prime costs and recognize that something occurred, then open the P&L and understand where to investigate further.
Bookkeeping Chef’s method is a combination of financial support for restaurants weekly reporting and automated bookkeeping in restaurants to accomplish this.
Automate repetitive tasks. Check your top costs each week. Study the language used in your P&L.
There is no need to be an accountant.
You must become an owner who understands the financials of your own restaurant.