The restaurant’s owner examines the sales, and then the bottom line before closing the report.
Does this sound familiar to you?
It may be an extremely accurate report, but by only examining those two figures, you leave the bulk of its value in the dust.
It shouldn’t cause them to become more dependent on an accounting firm. They should feel more confident about their numbers. It doesn’t require an expert in accounting or spend in the dark completing invoices. You must understand how profit has changed and what’s happened to food and labor costs and the other questions that must be addressed next week.
Bookkeeping Chef’s ethos is to automate bookkeeping chores that don’t require the time of restaurant owners while also providing customers with more precise financial information they can access.
Start with the Weekly Numbers, Not Just Month-End
A monthly P&L is important, however restaurants don’t run monthly. The managers schedule the labor for this week. Chefs order food right now. Vendors change prices now.
This is why Bookkeeping Chef provides weekly prime-cost flash reports in addition to monthly financial statements.
Prime cost brings together the cost of goods sold as well as labor, two areas that can move quickly in restaurants. The information provided by the Bookkeeping Chef reveals that prime costs typically account for 60 percent of sales in restaurants.
Imagine that sales have barely changed, but the primary cost increased. This percentage isn’t an answer. The owner has an opportunity to conduct some investigation.
Has the hourly wage increased? Did you have an overtime? Did food costs change? An invoice from a vendor appeared unusually large? Did sales mix changes?
It is more beneficial to find out about the problem now than later.
Automate repetitive work
DIY bookkeeping doesn’t have mean manually transferring POS totals to spreadsheets following service.
Modern restaurant bookkeeping automation can handle a significant portion all the repetitive transfer of financial information. It connects to various systems, including POS as well as QuickBooks, payroll, vendor platforms inventory management and recipe management, as well payment and AP tools.
The purpose is not to automate for its own sake.
It’s to make it easier for manual data entry and ensure that the financial records current enough that the owner can spend time reviewing data rather than assembling it.
It’s a totally new accounting model for restaurant establishments. Technology takes care of the mechanics and the proprietor remains involved in the financial aspect.
Learn to ask the P&L More Questions
If you stop thinking of a P&L as a test it will become less daunting.
Start by studying the sales. Examine the costs required to produce the sales. Compare food and beverage performance. Check the cost of labor. Examine labor.
Comparing periods is important.
If profits increase, but sales aren’t, it is a difference between the two. What changed when the cost of food increased? If the percentage of labor changed by a significant amount, you can compare sales and staffing activity. Check if the percentage seems strange, instead of assuming that the restaurant had poor times.
Bookkeeping Chef offers monthly P&Ls that are finalized in five business days. Owners can review the company’s performance without waiting months to receive financial statements.
Understanding is more crucial than speed when it comes to owners seeking bookkeeping solutions for restaurants.
It’s not necessary to build everything.
You can find a medium between hiring someone to manage your financial needs and having your own full-time accountant.
The owner is able to remain in the loop without manually completing each accounting task.
It could involve using 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.
Specialized restaurant bookkeeping services can support that approach by keeping the underlying books organized while helping the owner understand what the reports mean.
However, this does not mean the bookkeeper will be in a position to complete all bookkeeping functions.
Owners who are able to take a seat and converse intelligently about their business with the P&L will have more success.
The goal of financial independence isn’t just to write more reports, but rather to reach financial freedom
Restaurants already generate massive quantities of information. A different dashboard might not be beneficial.
Real value occurs when an operator can open the P&L report, recognize that there is a change, and then review the reports on the cost of prime.
Bookkeeping Chef’s strategy incorporates automation of bookkeeping in restaurants weekly reports monthly P&Ls, as well as restaurant-specific financial support for making this possible.
Automate the repetitive work. Examine your prime costs each week. Study the language used in your P&L.
You don’t have to be an accountant professional.
It is crucial to know the financials of your establishment before you are able to become the proprietor.