The owner of a restaurant opens the monthly P&L and looks at the sales, then jumps to the bottom line and then closes the report.
Does it sound familiar?
The report may be totally accurate, but if those are the only two figures to be reviewed, most of its value is left unreviewed.
The proper bookkeeping of a restaurant shouldn’t force owners more dependent on their accountant. They should be more confident with their own numbers. You don’t need to know every accounting rule or have to spend hours completing invoices. You must understand how profit has changed as well as what’s changed with food and labor costs and the questions that should be addressed next week.
Bookkeeping Chef’s philosophy is to automate tasks in bookkeeping that do not require the time of restaurant owners, and provide customers with more precise financial information they can use.
Begin with the Weekly Numbers Don’t Just Focus on Month-End
Although restaurants are not operating according to a calendar, they must still have an P&L. The managers this week plan their work. Chef orders food today. Vendors change prices now.
This is the reason Bookkeeping Chef provides weekly prime-cost flash reports alongside monthly financial statements.
The main cost is a combination of cost of goods and labor and labor, two areas where an establishment can accelerate its progress. According to data published by the Bookkeeping Chef prime costs represent approximately 60% of the sales at restaurants.
Imagine that sales have barely changed, but the price of production grew. This percentage doesn’t provide an answer. This gives the owner an opportunity to conduct some digging.
Has the hourly wage increased? Did overtime happen? Did the price of food changed? The invoice of a vendor was unusually high. Did the mix of sales changed?
It is more beneficial to discover the issue now rather instead of waiting until later.
Automate the repetitive Work
DIY bookkeeping doesn’t have to be a manual process of transferring POS totals into spreadsheets after the service.
Automating the bookkeeping processes of restaurants can eliminate a lot of repetitive data movement. The service can connect to systems such as POS, QuickBooks, payroll vendors, vendor platforms inventory management and recipe management as well tools for AP/payment.
Automating for the sake of automated is not the aim.
The aim is to reduce manually entering data and ensure that financial records are up-to-date to allow owners to spend more time reviewing the data rather than 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.
P&L Questions: Find out How to Ask More Effective Questions
A P&L can be a lot less intimidating when you stop treating it as an accounting test.
Start with the sales. Then, take a look at costs of production. Compare the food and beverages performances. Think about the labor. Reduce your operating expenses.
Comparing periods.
If the sales increased, but the profit did not, something in between those two lines has changed. What happened when food prices were rising? Check sales and staffing to see if the labor percentage has changed. If you notice a strange number examine it instead of thinking the restaurant just had an awful month.
Bookkeeping Chef will send monthly P&Ls within five working days. This allows owners to review recent results without having to wait for financial statements, which often arrive months later than the conclusion of the operating period.
Speed is essential, but it is important to know.
You don’t have to handle everything on your own when you make it DIY
You don’t have to become your own full time bookkeeper to avoid giving the entire financial responsibility to another person.
Owners can still be involved in the process of accounting without having to perform every task by hand.
The process could be as simple as using automated system connections in order to ensure that the information is flowing. Or it could be as extensive and intricate an analysis of the monthly P&L or even a review of a weekly Prime-cost report.
Restaurant bookkeeping services that specialize in the restaurant industry can assist owners comprehend the significance of reports by organizing the books and ensuring they are organized.
This doesn’t mean the bookkeeper will be able to perform all bookkeeping functions.
A business owner can talk to the P&L regarding the company.
The goal is financial independence without reporting
Restaurants are a major source of data. A different dashboard won’t be as effective.
Value is realized when an employee can open an P&L report, recognize that there is a change and then look at the prime-cost reports.
Bookkeeping Chef’s strategy combines restaurant bookkeeping automation daily reporting along with monthly P&Ls and the financial support for specific restaurants to make that possible.
Automate repetitive work. Review the prime cost each week. Learn the terminology employed within your P&L.
There is no need to become an accountant.
You must become a restaurant owner who is aware of the financials of your restaurant.
