(If you were an accountant in a past life, congratulations on the serious advantage!
Fixed costs don’t change, making them easier to anticipate and include in your budget.
But you’ll also have to account for semi-variable costs, which will change slightly from month to month.
Example: Repairs, marketing, advertising, taxes, delivery charges When you’re budgeting, it also helps to know costs you can control versus what you can’t.
By defining these costs, you can determine your must-haves against your nice-to-haves. Examples: labor, marketing, food cost Uncontrollable costs: Costs you can’t control.
While there will always be costs you can’t control, a budget gives you framework for the financial decisions you can control.
While striking the perfect budget balance is full of educated guesswork, it’s an essential business process.An accountant and/or bookkeeper: Your restaurant accountant will perform in-depth analysis on your financials to ensure your operations are meeting industry standards.Your bookkeeper is in charge of keeping your financial records.When reviewing past performance, you’ll also want to consider the following factors: Create or access a chart in your accounting system that looks something like the one below.This chart is completed year-over-year, but you could dive deeper, comparing the four week periods in each month.Your accounting system and POS can automate cost tracking, including your Cost of Goods Sold (Co GS), labor costs, and supplier invoices.Before you start budgeting, you’ll want to define your accounting period.From there you’ll learn how to adjust your strategy so you can stay within your financial limits while maximizing your potential for profitability.The nice thing about restaurant costs is that many of them are fixed.Your restaurant’s budget and forecast are as close as you’re going to get to seeing the future of your business.Your restaurant budget defines your financial limits, while your restaurant’s financial forecast determines what you’ll be able to do within those limits.