The restaurant owner looks at the sales before focusing on the bottom line prior to closing the report.
Do these sound like familiar to you?
If only these two numbers are scrutinized then the real value is not realized.
Good restaurant bookkeeping shouldn’t make owners more dependent on an accountant. It should give them confidence in their own financials. It’s not required to sit the night completing invoices or master every accounting rule. However, you must understand how profit moved, what happened to food and labor costs and which issues require consideration next week.
Bookkeeping Chef’s philosophy is to automate bookkeeping tasks which don’t take the time of restaurant owners while also providing them with clearer financial data that they can make use of.
Do Not Stop at the Month-End Numbers. Start by calculating Weekly Numbers
Although restaurants do not operate on a calendar month, they must still have a P&L. The managers this week plan their labor. Chef orders food now. Vendors change prices now.
Bookkeeping Chef’s weekly prime-cost reports are published alongside the monthly financial statements.
Prime cost is the sum of costs of selling goods and labor two major areas that are able to move quickly in a restaurant. According to information provided by Bookkeeping Chef, prime costs represent approximately 60% of restaurant sales.
Let’s say sales have not changed at all however the price of prime is increasing. The percentage doesn’t give the answer. It gives the owner an opportunity to research.
Was there an increase in the number of hours employed? Did overtime take place? Did the price of food increased? A vendor’s invoice was unusually high. Have the sales mix changed?
This is a lot more helpful than discovering the same issue several weeks later.
Automate the repetitive work
DIY bookkeeping doesn’t need to mean manually transferring POS totals to spreadsheets following the.
Automating the bookkeeping of restaurants can assist with repetitive financial data movements. The service can connect POS systems including QuickBooks, QuickBooks, vendors platforms recipes and inventory management, as well as Payment instruments/AP.
Automating for the sake automated is not the aim.
It’s a way to streamline data entry and ensure that the accounting records up to date so that the owner can spend time looking over data instead of gathering it.
This leads to a different style of bookkeeping in restaurants: technology can handle the mechanics, while the owner stays active in the financial aspect.
If you have more questions, you can ask them about P&L
Stop thinking of your P&L as something that could be an accounting test.
Begin with sales. Start with sales. Compare food and beverage performance. Take into consideration the labor. Examine labor.
More importantly, compare periods.
If the sales rise but the profits aren’t, there’s a change between them. What changed when the cost of food were rising? If the labor rate changed in the past, look at sales and staffing activity. Examine any figures that appear unusual, instead of just thinking that the restaurant experienced a poor week.
Bookkeeping Chef gives monthly P&Ls, which are finished in five days. Business owners can look over the performance of their company without waiting for months to receive financial statements.
For owners searching bookkeeping restaurant solutions, speed can be beneficial however understanding is the greater purpose.
It’s not necessary to take on everything by yourself when you DIY
There is a middle ground between outsourcing the entire financial function to someone else and being your own bookkeeper full-time.
Owners can still be involved in the accounting process, without needing to complete every task manually.
It could be as easy as utilizing automated system connections in order to ensure that information flows. But it could also be as intricate and complicated review of the month’s P&L or a study of a weekly Prime-cost report.
The services of specialized restaurant bookkeeping can support that approach by keeping the underlying books organized while helping the owner understand what the reports mean.
The result is not a bookkeeping owner who is skilled enough to complete every bookkeeping task.
Business owners who can be able to sit down and discuss intelligently about their business with the P&L are more likely to succeed.
The objective of financial independence is not to produce more reports, but rather to achieve financial freedom
Restaurants already generate massive quantities of data. Another dashboard may not be helpful.
Real value occurs when an employee can open an P&L report and recognize that there is a change, and then review the reports on prime costs.
Bookkeeping Chef’s approach to bookkeeping integrates restaurant accounting automation with daily reports, monthly P&Ls, and restaurant-specific financial assistance to make this process possible.
Automate repetitive tasks. Check your top costs each week. Learn to speak the same language as your P&L.
There is no need to be an accountant.
You should become an owner who understands the financial story of your restaurant.