A restaurant owner opens the monthly P&L, looks at sales, then skips to the bottom line and then closes the P&L.
Sound familiar?
The report could be completely precise, but if these are the only two figures reviewed the majority of its value is being left on the table.
A good restaurant bookkeeping system shouldn’t increase the dependence of the owners on accountants. They should become more confident in their own financials. It doesn’t require an accountant or stay up all the night entering invoices. It’s important to understand why the profit changed as well as what happened to the labor and food items and which issues require focus next week.
Bookkeeping Chef is a computer program that automates bookkeeping, so the owners can focus in other activities while receiving more precise financial reports.
Don’t stop at Month-End Numbers. Start by calculating Weekly Numbers
Even though restaurants do not operate in a calendar month, they still need to have a P&L. This week, the managers plan their labor. Chefs order food today. Vendors change prices now.
Bookkeeping Chef offers weekly flash reports on top costs along with monthly financial statements.
Prime cost is the sum of two major areas that are easily transported in a restaurant establishment: cost of the goods sold, and the cost of labor. The information provided by the Bookkeeping Chef indicates that prime costs generally comprise about 60% of sales in restaurants.
If sales haven’t changed much and the prime cost has increased. The percentage by itself does not provide the answer. It provides the owner with a reason to do some research.
Has the hourly wage increased? Was there an overtime? Did the price of food changed? Did a vendor invoice seem abnormally high? Did the sales mix change?
This is far more beneficial than having the same issue after a few weeks.
Let Automation Handle the Repetitive Work
DIY bookkeeping doesn’t need to involve manually transferring POS amounts into spreadsheets after the.
Modern bookkeeping automation in restaurants can manage a lot of the repeated transfer of financial information. The service is able to connect systems like POS and QuickBooks, payroll, vendor platforms inventory management, recipe and recipe management as well as tools for AP/payment.
Automation is not the goal.
The goal is to eliminate manually entering data and keep financial records up-to-date so that managers are able to spend more time looking over the data instead of trying to assemble it.
It creates a completely different bookkeeping system for restaurants. Technology manages the mechanics and the proprietor remains involved in the financial side.
Ask more questions about P&L
A P&L becomes much less intimidating when you stop thinking of it as an accounting test.
Start with sales. Begin with sales. Compare the food and beverage performances. Take into consideration the labor. See the work.
Compare periods.
Something between these two lines has changed in the event that sales have increased but the profits haven’t. If the cost of food has increased, find out what was happening operationally. Check the levels of staffing and sales activities in case labor percentages have changed. Examine any figures that appear strange, rather than assuming that the restaurant was not doing well during the week.
Bookkeeping Chef will send monthly P&Ls completed within five business days, allowing owners the chance to examine recent results rather than receive financial statements after the operational period is over.
Speed is important, but it is important to know.
It’s not necessary to do everything.
You can find a happy medium between hiring someone to handle your entire financial functions and having your own full-time accountant.
Owners can continue to be involved in the process of accounting without needing to complete every task manually.
The process could be as simple as using automated system connections in order to ensure that information flows. However, it could be as intricate and complicated a study of the monthly P&L or a study of a 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 is very unlikely that you will get a bookkeeper who can perform all of the functions.
Owners who are able be able to sit down and discuss intelligently about their company with the P&L are more likely to succeed.
The goal is financial independence, not more reports
Restaurants already generate huge quantities of data. The other dashboards aren’t necessarily useful.
Value is realized when an employee can open an P&L report, be aware that there was a change, and then go through the prime-cost reports.
Bookkeeping Chef’s method combines restaurant accounting automation, daily reports, monthly P&Ls and restaurant-specific financial assistance to make this possible.
Automate repetitive tasks. Review the prime cost each week. Learn the language of your P&L.
You don’t need to be a professional accountant.
It is crucial to comprehend the finances of your restaurant before you become an owner.