restaurant financial

The notion of a restaurant financial perspective can be rather daunting while running a business. This is further compounded by the fact there are many different common ways to run restaurant financial reports and gain understanding. There are four primary financial reporting tools. They are:

1)      Income statement

2)      Balance Sheet

3)      Statement of Cash Flow

4)      Statement of Owner’s Equity

Those are all tools to manage the business and insure that it is meeting financial viability. I have found that most of my clients have no idea how to manage their finances. I promise you it is not impossible or undoable. I’d recommend hiring a bookkeeper to set up your systems for you and then you can easily manage the daily operations.

The most important components are to understand one’s foxed costs ( rent, management fees etc.) and then to understand the cost of goods sold  or food cost. That is how much does it cost you to produce and sell your inventory. With an understanding of these two categories you’ll have a reasonable sense of your businesses financial viability.