529 College Savings Plan: Pros, Cons and Alternatives
Considering the projected costs of a college education over the next few decades, it could cost more than a million dollars for your kids or...
4 min read
George Liakakis
:
Oct 18, 2023
A business that has a solid financial plan in place isn’t guaranteed to succeed, but a business with no financial plan is practically doomed. Restaurant owners, who operate in a uniquely challenging market, can’t afford to neglect careful financial planning. Being diligent about creating, reviewing and adjusting the business financial plan is an essential part of keeping a restaurant’s doors open long-term in an industry with thin profit margins.
Because a financial plan is so imperative to a restaurant’s success, working on it can also be daunting—especially if you’re a restaurant owner whose passion is food and not finance.
Whether you’re just starting the process of opening a restaurant, or giving your existing financial plan a check-up, working with your financial and business advisors is always the best way to make sure your plan is comprehensive and is designed to help you achieve your financial business goals.
A restaurant’s financial plan encompasses many parts. It’s kind of a living organism that will evolve and change over the course of a restaurant’s lifespan. Some of the key components in a restaurant’s financial plan include:
For new restaurants establishing a CoA for the first time, there also needs to be a clear plan in place for maintaining it. Software can automate a lot of the data collection but someone needs to be in charge of managing and reviewing the CoA to ensure it stays accurate and current. Outsourcing to a bookkeeper is one option, or you may feel comfortable keeping bookkeeping in-house. If you or a partner are going to be in charge of your own CoA, you’ll need to plan on carving out time to keep it updated. In this case, you would also want to make sure that a trusted partner or manager understands the CoA in case someone needs to step in in your absence.
Some restaurant owners monitor their financials hour to hour. Others take a more relaxed approach, maybe glancing at daily reports but not digging deeply into the business’s financial status until they sit down with their accountant. Generally speaking, it’s good practice to review the core elements of your financial plan every month, or more often if you’re concerned. Pore over all your financial statements, CoA, payroll reports and any reports your bookkeeper or accounting software generates. If anything’s trending in the wrong direction, or seems confusing or off in any way, obviously you want to figure that out sooner rather than later.
You’re the expert on menus and hospitality, but Sachetta LLC’s business consulting team can help you do the heavy lifting on the business side of your restaurant. From tax planning and creating the business financial plan for a new restaurant, to helping an established restaurant operate more efficiently, we’re here to give restaurant owners whatever business support they need to thrive. We can’t help in the kitchen, but we’ll help everywhere else. Contact us today!
Georgios Liakakis, CPA, MSA is a Certified Public Accountant and holds a Master’s Degree in Accounting from the University of Massachusetts Lowell. He joined our team in 2016 and focuses on both business and individual taxation.
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