Posts Tagged ‘ Weekly Inventory

F&B Directors: the End of the Month is Too Late

You’re not going to like this. Not at all.

Why should you? After all, you’re executing every required procedure, submitting every required report, even meeting deadlines most of the time. A week or two after the month ends, you get a P&L and find out how you did. Sure, you already have an idea. Certainly you know the revenues for the month. Maybe even your purchases.

Then when you get your P&L you analyze the results, and plan how to make improvements. Good. Except – it’s too late.

The January P&L arrives February 10, you spend a week reviewing it, attending meetings, making plans, writing explanations, submitting reports. By March 1 you implement appropriate tweaks, changes.

But the time to react to January trends isn’t March. And it isn’t February.

It’s January.

Your controller shouldn’t have to tell you your results – you should tell your controller. Your GM should hear your results for the first time from you, not your controller.

 THE PATH TO F&B STARDOM

While I can’t describe the path exactly, I can assure you that the it has weekly milestones. That’s right: the path to success is guided by the dreaded weekly P&L.

In an earlier blog, “Are You Tracking That?” I talked about the plethora of data managers are bombarded with today, about how it’s overwhelming, how the best managers keep their own spreadsheet “on the side”, and how the best companies track a specific but limited number of items. So, here’s what your “spreadsheet on the side” should look like: weekly revenue, COGS, labor cost, other expenses, compared to budget. If your week ended Sunday, you should know the results by noon on Monday.

WALKING THE PATH TO STARDOM

Make no mistake about this. Initially you (or someone in your department) will have more work to do. Soon, however, the process will become systemic. You will not want to give it up.

There will be multiple data sources in a larger hotel, fewer in a smaller hotel. You may wish to split up the accountability.

Here’s how to track:

  • Start a spreadsheet – you may wish to have one tab for each week
  • Enter the budget once a month by first calculating a pro-rata weekly budget
  • Track by week with the week ending the same day the payroll week ends
  • If you’re on a calendar month (an unfortunate burden) you will have weeks that span two accounting periods – always use the new month’s budget figures, as most of the results will end up in the “next” P&L
  • Track the numbers DAILY for sales, covers, purchases, labor cost, labor hours, etc.
  • Conduct a weekly inventory of both food and beverage (a blog dedicated to this procedure – and how to make it easy – coming soon)

Here’s what to track

  • Sales – by outlet, by meal period; also for each, covers
  • COGS – food cost, beverage cost, A/V & Other costs
  • Labor costs – hourly wages, salaried wages, benefits costs
  • “Bonus” labor tracking: if possible, track labor hours. This results will allow two simple and revealing calculations: labor minutes per cover and sales per labor hour
  • Purchases of food and beverage
  • Ending inventory (yes, again, you should take weekly inventories – pay no attention to whether accounting wants or needs these figures)
  • Other expenses, supplies, etc.
  • You can – and should – enhance the weekly report with auto-calculated percentages, and a running total for the week (and for the month, if you wish)

Finally, remember above all else: this is not an accounting document, but a management information tool. Do this – your management effectiveness will increase exponentially.

Those are my thoughts, let me know yours.

Post to Twitter