Restaurant owners will open their monthly P&L reports, and look at the sales, and then go to the bottom and close the report.
Does this sound familiar to you?
If only these two numbers are scrutinized the report’s true worth is not realized.
A good restaurant bookkeeping system won’t make it more dependent on owners on accountants. They should become more comfortable with their own financials. It is not necessary to be aware of each accounting rule, or do a lot of work in the evenings completing invoices. You need to understand the way profit has fluctuated as well as what’s changed with the cost of food and labor, and the questions that should be addressed next week.
Bookkeeping Chef is a program which automatizes bookkeeping, so the owners can focus on other things while getting more clear financial reports.
It is recommended to begin by looking at the Weekly Numbers and Not Only Month-End
A monthly P&L is important, however restaurants don’t operate monthly. The managers this week plan their activities. Chefs ordered food this morning. Vendors change prices now.
Bookkeeping Chef’s weekly prime-cost reports are included with the financial statements for the month.
Prime cost brings together the cost of goods sold as well as labor. Both of these are major areas that are able to move quickly in a restaurant. Bookkeeping Chef’s supplied information notes that prime costs typically represent roughly 60% of sales in restaurants.
Consider a situation where sales aren’t even changing however, the cost of prime services are growing. That percentage alone doesn’t provide the answer. This gives the owner an opportunity to conduct some investigation.
Did the hourly wage rise? Did overtime happen? Has the cost of food changed? A vendor’s invoice was unusually high. Did the mix of sales changed?
It is better to know about the issue now rather before it gets worse.
Let Automation Handle the Repetitive Work
DIY bookkeeping doesn’t have to be difficult. It can simply involve manually transfer POS (point of sale) totals into spreadsheets.
Automating the bookkeeping of restaurants can assist with the frequent movement of financial information. The service can connect to systems such as POS, QuickBooks, payroll vendors, vendor platforms inventory management, recipe and recipe management as well as Payment and AP tools.
The goal is not automation to achieve its own ends.
This reduces the manual data entry. Also, it keeps the financial records up-to-date so that owners are able to focus on studying data, not gathering it.
This creates a new model of bookkeeping that restaurants use: technology is able to handle more mechanical aspects, while the restaurant owner is active in the financial aspect.
You can ask better questions about P&L
A P&L can be a lot less intimidating when you stop treating it as an accounting exam.
Start by reviewing sales. Then look at the costs that are required to generate those sales. Compare the efficiency of food and beverages. Consider labor. Keep working to cut down your operating costs.
Comparing periods is important.
Something between these two lines has changed in the event that sales have been increasing, but profits have not. If food prices has increased, find out what was happening operationally. If the percentage of labor changed in the past, look at sales and staffing activity. If a figure appears to be odd, investigate rather than assuming the restaurant just had an unlucky month.
Bookkeeping Chef will send monthly P&Ls finalized within five business days. This provides owners an opportunity to review recent performance rather than receiving financial statements long after the period of operation is over.
Speed is essential, but it is important to know.
It’s not necessary to do everything.
It’s not necessary to become your own bookkeeper full-time in order to avoid handing over the whole financial responsibility to another person.
Owners can be still involved in the accounting process, without being required to do every job manually.
This could mean the use of automated system connections in order to ensure that information is flowing and analyzing a weekly prime-cost report, looking at the monthly P&L, and asking questions whenever something happens unexpectedly.
Services for bookkeeping in restaurants that focus in the restaurant industry can assist owners understand the meaning of the reports by arranging the books and keeping them in order.
This does not mean that the bookkeeper will be able to perform all bookkeeping tasks.
It’s an owner who can take a seat with the P&L and have a stimulating discussion about the company.
The objective of financial independence isn’t to create more reports, but to reach financial freedom
Restaurants already generate huge amounts of data. Another dashboard may not be beneficial.
The real value is when an operator is able to look at the weekly report of prime cost 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. Review prime cost every week. Learn the terminology used within your P&L.
You do not need to be an accountant.
It is crucial to comprehend the financials of your restaurant prior to when you become an owner.