Get Your Restaurant’s Finances On The Right Track
Owning and operating a restaurant is a full-time commitment. The National Restaurant Association reports that the average profit margin for a full service restaurant is 2%. This leaves a small window for financial mistakes when running your restaurant. The more organized your restaurant’s financial records, the more money will end up in your pocket each quarter. Here are some tips given by the industry’s top restaurant consultants on how to increase your restaurant’s profits and organize the books.
The best way of increasing your profits is simply by bringing people in the door. Improving the look and feel of your restaurant, as well as the menu items is a great start. You want people to feel relaxed and comfortable when dining in your eating establishment. Consider which population you are serving, and give your restaurant a face life to cater toward that crowd. Restaurant consultants often suggest making a few simple changes to attract more customers.
Make sure that your labor is scheduled according to the gross profits earned. Labor expenses, including wages, insurance benefits, and employer paid taxes, are one of the main expenses when dealing with a restaurant. It is also one of the most controllable expenses. Researching the trends, and scheduling employees according to the customer occupancy, can help to lower some of the labor costs.
Another controllable expense is the food and beverage inventory. Having too much inventory for the corresponding sales will lead to product waste, increased potential for theft, reduced product utilization, and over-portioning. Your product will expire before you have a chance to serve it to your customers. Knowing how much product to keep in stock, without running low on key items can be tricky. Restaurant consultants suggest that a restaurant should have approximately 7 days’ worth of inventory in stock. This number may vary depending on factors, such as whether you are a full-service or quick service restaurant.
Many restaurant owners lose money due to the inability to read and understand their financial statements. What is a P & L? How do I calculate my balance sheet? The Profit and Loss Statement, Statement of Cash Flows, and Balance Sheet are all important documents when it comes to running a restaurant. Restaurant consultants can help you understand your reports, what they mean, and how you can use them to benefit your finances.
Running a restaurant is no easy feat. Sometimes it is necessary to have a professional’s help. Qualified and experienced consultants can help you transform your restaurant into a more profitable business.
Exceptional restaurant consultants are waiting to help you improve the efficiency and profitability of your business. Don’t wait until it is too late. Contact The Gilkey Restaurant Consulting Group today.