The best way to prevent financial trouble and figure out how the restaurant is doing is to find out where the money comes from, where it goes, who gets it, and why. It’s called accounting, and it’s a way of keeping score. In this competitive society, people like to be challenged and like the concept of keeping score. Some owners share their restaurant’s key performance numbers with all of their team members as a way to motivate them to increase sales and profits.
Cannon says, “Your main job is to run a restaurant. Use your restaurant-based in-unit accounting for the data you need to make the restaurant work, and leave the serious accounting for the bankers, lawyers, and CPAs. Even so, you have to keep the books for the restaurant, so you must learn a little accounting.”
Control cash? Who wants to do such a thing? Cash is fun and should be spent! Right? . . . Wrong. Controlling cash is traditionally the first step to improving and analyzing the bottom line and is critical to success as a restaurant owner. Restaurant owners constantly play a game called Watch the Cash. “Money is king. If you have it, you try to keep it,” says Cannon, adding, “The difficulty comes because you are not the only one who touches your money. It would be nice if every minute of every day you were the only one touching that hard-earned money. And, it would be nice if you had a team that loves you so much that not a single one of them would ever think of stealing your hard-earned money. And, it would be nice if a genie granted you three wishes, and your fairy godmother showed up with a fourth. It would be nice, but it’s not reality. Get a good system, put it in place, use it, and make sure your employees know you use it.”
Howard Cannon is a highly-recognized restaurant expert witness, consultant, analyst, and speaker. He is the author of The Complete Idiot’s Guide to Starting a Restaurant© - found in 76 countries around the globe. Mr. Cannon is the CEO of Restaurant Consultants of America and Restaurant Expert Witness, and can be reached at 800-300-5764 or via the web at RestaurantConsultantsOfAmerica.com or RestaurantExpertWitness.com.