A lot of owners only see a P&L once a month, weeks after the month ends. By then the roster that blew out and the supplier who put his prices up are old news. You can’t fix last month.
So every week we send our venues one page. This one is based on a real venue’s week, with the figures changed so you can’t tell whose it is.
The page
- Sales: $24,615.30
- Cost of goods: 30.7%
- Labour: 37.8%
- Overheads: $3,004.05
- Net profit: $4,744.35, which is 19.3%
- Put away for BAS: $2,945.00
- Next supplier run: $1,287.06
The note we sent with it: “Revenue above target. Labour ran hot at 37.8% against a 37% target, so the roster is trimmed for next week. Margin holds at 19.3%.”
The first five lines tell you how the week went. The last two tell you what cash to hold back. You should be able to read it on your phone before service.
Labour is the line that moves
This venue was 0.8 of a point over its labour target. That’s $197 this week, and over $10,000 a year if it keeps happening.
A monthly report would have shown four weeks of that at once, after the rosters were already worked. On a Friday you can still change next week’s roster before it goes out.
When labour runs hot, a useful check is sales per labour hour: sales divided by hours worked. A Saturday doing $4,800 on 60 hours is $80 an hour. A Tuesday doing $1,500 on 30 hours is $50. Quiet days are where wages slip, because you still need a cook and a barista to open the doors.
Cost of goods tells you when suppliers move
Price rises don’t always come with a phone call. They turn up on the invoice, and then in your cost of goods. A two point jump with the same menu and the same sales usually means a price rise, a portion creeping up, or waste.
We code invoices as they come in and flag price rises the week they happen, so you can ask the supplier about it while the invoice is still on the bench.
Add those two together
Cost of goods plus labour is your prime cost. We use 70% or under as the goal, which leaves enough for rent and the other overheads with a profit on top.
This week: 30.7% plus 37.8% is 68.5%. Inside the line, just. On this venue’s sales, every point of prime cost is about $246 a week. That’s the number to have in your head when you’re deciding whether to put prices up or take a shift off the roster.
Put the BAS money away every Friday
Each week we work out what that week has added to your next BAS and put the figure on the page. Move it into a separate account the same day, which is what the ATO suggests too, and the money is there when the BAS is due.
What we would do this week
- Read sales, then labour, then cost of goods, then net
- If labour is over target, fix next week’s roster today
- If cost of goods jumped, pull your top five supplier invoices
- Move the BAS figure into its own account
If you want this page every Friday for your venue, that is our weekly P&L.