Restaurant owners open their monthly P&L reports, check the sales, and then go to the bottom and close the report.
Does this sound familiar to you?
It might be a completely precise report, but when you only look at those two numbers, it leaves a lot of its value on the table.
Good restaurant bookkeeping shouldn’t make owners more dependent on an accountant. It should provide them with confidence in their own financials. You don’t have to be an accounting expert or spend the night entering invoices. It is important to know what caused the change in profit and what transpired with the labor and food items, and which questions need focus next week.
Bookkeeping Chef’s philosophy is to automate bookkeeping chores that do not require the time of restaurant owners, while providing users with better financial information they can use.
Begin with the Weekly Numbers Start with the Weekly Numbers, Not just Month-End
A monthly P&L is important, however restaurants do not operate on a monthly basis. This week, the managers plan their schedules. Chef orders food now. Vendors change prices now.
Bookkeeping Chef’s weekly Prime-cost reports are provided alongside the monthly financial statements.
Prime cost combines the price of the goods sold and labor. Both of these are major sectors that can quickly move in the restaurant. The information supplied by the Bookkeeping Chef indicates that the prime cost typically accounts for 60% of sales in restaurants.
Imagine that sales barely changed but the cost of production increased. This percentage does not provide an answer. It provides the person with a reason to investigate.
Have the hourly wages increased? Was there overtime? Was the cost of food changed? Was a vendor invoice unusually high? Did the mix of sales changed?
It is better to know about the issue sooner rather as opposed to later.
Automate repetitive tasks
DIY bookkeeping doesn’t need to require manual transfer of POS totals into spreadsheets after service.
Automating the bookkeeping of restaurants can assist with repetitive financial data movements. It connects to various systems, including POS Payroll, QuickBooks, POS vendors, vendor platforms inventory management, recipe and recipe management and tools for AP/payment.
Automating for the sake of automation is not the objective.
The goal is to eradicate manually entering data and to ensure that financial records are kept up-to date to allow owners to take more time in reviewing the data instead of trying to assemble it.
It creates a completely different bookkeeping process for restaurant establishments. Technology manages the mechanics and the restaurant owner remains engaged with the financial aspects.
P&L Questions: Find out to Ask Better Questions
When you stop treating a P&L as a type of test, it will become less daunting.
Start with sales. Begin with sales. Compare the efficiency of food and beverages. Take into consideration the labor. Reduce your operating costs.
The importance of comparing periods.
If sales increase but profits do not, there is an alteration between the two. What happened when food prices increased? If the percentage of labor changed between staffing and sales activity. Examine any figures that appear odd, instead of assuming a restaurant had a bad week.
Bookkeeping Chef offers monthly P&Ls that can be completed within five days. Business owners can look over the performance of their company without having to wait for months before receiving financial statements.
For those who are looking for bookkeeping restaurant solutions, speed is useful but understanding is the main purpose.
There’s no need to be a pro when you DIY
You can find a comfortable compromise between hiring someone else to handle your entire financial functions as well as being your own full-time accountant.
The owner is able to remain engaged without having to manually complete each accounting job.
It could be as simple as connecting to automated systems to keep information flowing, reviewing a weekly prime-cost report, or studying the monthly P&L and posing questions when something moves unexpectedly.
The specialization in restaurant bookkeeping can assist in this manner by making sure that the books are organized and helping the owner to be aware of what they represent.
The result is not a bookkeeping owner who is skilled enough to complete every bookkeeping task.
Owners who are able to take a seat and converse intelligently about their business to the P&L will have more success.
The Objective Is Financial Independence, Not More Reports
Restaurants already generate huge quantities of data. Dashboards don’t always make sense.
The true value is when an operator looks at a weekly report on prime costs and recognize that something was different, then look at the P&L and figure out what to do next.
Bookkeeping Chef’s strategy includes automated bookkeeping for restaurants daily reporting along with monthly P&Ls and restaurant-specific financial support for making this possible.
Automatize repetitive tasks. Check your top costs each week. Study the language used in your P&L.
You don’t have to be a professional accountant.
It is important to understand the finances of your restaurant before you take over as the owner.