Financial Checklist

Successful restaurants are consistent in many areas, such as service, food, and atmosphere, but one area is critical to continued success: successful financial management.

There are many ways operators can control costs and therefore retain control over the business. Here are a few suggestions.

• Base your accounting system on the National Restaurant Association's Uniform System of Accounts for Restaurants.
  
• Charge costs and expenses to the period in which they're purchased.
  
• Incorporate daily inventory checks.
  
• Break your food cost down into categories, such as meat, seafood, dairy, poultry, and grocery, to identify problems and/or irregularities.
  
• Keep managers up-to-date with food cost numbers.
  
• Tie part of managers' compensation to profit and loss results.
  
• Understand your balance sheet and review it each period.
  
• Compare profit and loss statements to a budget or prior period.
  
• Calculate and track your inventory turnover on food and beverages.
  
• Consider the impact of customer counts and check averages when reviewing sales trends.
  
• Make sure your accountant understands the restaurant industry and gives you valuable feedback on a regular basis.
  
• Make sure managers know their sales, cost of sales, and labor costs every week.
  
• Calculate your break-even point.