A restaurant owner opens the monthly P&L then looks over sales, then jumps to the bottom line and then closes the P&L.
Sounds familiar?
The report could be completely accurate, but if those are the only two figures reviewed, most of its value is left on the table.
A reliable bookkeeping system for restaurants shouldn’t increase the dependence of restaurant owners on accountants. They should be more confident of their financials. You don’t have to know all accounting rules or be a slave to invoices for hours. However, you must understand the reasons why profit fluctuated and what happened to costs for food and labor and what issues need attention next week.
Bookkeeping Chef’s philosophy is to automate tasks in bookkeeping which don’t take the time of restaurant owners while also providing users with better financial information they can utilize.
You should begin by looking at the Weekly Numbers and Not Just Month-End
Although restaurants are not operating in a calendar month, they still need to have a P&L. Managers plan the labor for this week. Chefs order food right now. Vendors change prices now.
Bookkeeping Chef’s weekly Prime-cost reports are available alongside the financial statements for the month.
Prime cost is the sum of two important areas which can be quickly moved in a food service establishment: cost of the goods that are sold, as well as labor. Based on the information published by the Bookkeeping Chef prime costs account for around 60% of sales in restaurants.
Suppose sales have barely changed however the price of prime is increasing. This percentage doesn’t provide an answer. The owner has an opportunity to conduct some investigation.
Did you notice an increase in the amount of time employed? Was overtime a factor? Was the cost of food increased? A vendor’s invoice was abnormally high. Did sales mix changes?
This is much more valuable than identifying the same issue several weeks later.
Automate repetitive tasks
DIY bookkeeping doesn’t need to be difficult. It can simply involve manually transfer POS (point of sale) totals into spreadsheets.
Modern restaurant bookkeeping automation can handle a significant portion of the repeated movements of financial data. The service is able to integrate systems like POS and QuickBooks payroll vendor platforms, and inventory management.
The goal is not automation to achieve its own ends.
The aim is to reduce the manual entry of data, and keep financial records up-to-date so that owners are able to spend more time analyzing the information instead of assembling it.
This is a completely new way of bookkeeping in restaurants. The software is able to handle more of the mechanics, while the owner is still involved in the financial aspects.
Learn to Ask the P&L More Questions
A P&L can be a lot less intimidating when you stop treating it like an accounting exam.
Begin by looking at the sales. Begin with sales. Compare food and beverage performance. Think about the labor. See the work.
Comparing the time spans is crucial.
Something in between has changed, if sales been increasing, but profits have not. What did happen when prices for food increased? Compare staffing with sales to determine if the labor percentage has changed. If a number looks strange examine it instead of thinking the restaurant simply had a bad month.
Bookkeeping Chef will send monthly P&Ls within five working days. This allows owners to view recent performance without waiting for financial statements which usually arrive months after the conclusion of an operating period.
Speed is important, however it is important to know.
It’s not necessary to DIY everything.
There’s a compromise between handing the entire financial functions to someone else and having your own bookkeeper full-time.
You could be a part of a business owner and not be required to complete every accounting task manually.
It could be as simple as utilizing automated system connections to ensure that information flows. It could also be as intricate and complicated an analysis of the monthly P&L or a review of the weekly Prime Cost Report.
Specialized restaurant bookkeeping services can support that approach by keeping the underlying books organized while helping the owner understand what the reports mean.
It’s not an owner who is skilled enough to perform every bookkeeping function.
An owner is someone who can have a conversation with a P&L regarding the company.
The Objective Is Financial Independence and not More Reports
Restaurants already generate enormous amounts of data. A different dashboard might not be helpful.
The real value comes when an employee can open the P&L report, recognize that there was a change, and then review the reports on the cost of prime.
Bookkeeping Chef s approach integrates restaurant accounting automation with daily reports, monthly P&Ls, and specific financial assistance for restaurants to make this feasible.
Automate repetitive tasks. Check your prime costs every week. Learn the terminology employed within your P&L.
You do not have to be an accountant to be an.
It is important to understand the finances of your restaurant before you can become a proprietor.