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How do you make a monthly restaurant budget? It’s a question that can be daunting for restaurateurs, but it’s also a crucial part of keeping your business afloat. In this post, we’ll explore four steps to creating a budget that works for your establishment. We’ll also provide tips and advice along the way to help you stay on track. So dive in and get started!
Calculate Your Average Monthly Sales
The first step in creating a restaurant budget is to calculate your average monthly sales. This should include all revenue from guest dining and catering, as well as any other sources of income. To get an accurate picture of your restaurant’s finances, you’ll want to look at past financial data. You can use this data to create projections for future months and determine where you need to make adjustments if necessary.
It’s also important to factor in seasonal fluctuations when determining your average monthly sales. For example, if you see that your restaurant has higher sales during the summer months than during the winter months, it makes sense to plan accordingly and adjust your budget accordingly as well. Additionally, you may want to consider setting aside funds for marketing or promotions that could potentially increase your restaurant’s profitability.
Subtract Your Fixed Costs
The next step is to subtract your fixed costs from your average monthly sales. This includes expenses such as rent, utilities, insurance, and payroll taxes. These are all essential costs that cannot be adjusted month-to-month depending on the circumstances. By accurately calculating your fixed costs, you can get a better idea of how much money you have left over for variable costs after these deductibles have been paid for.
When budgeting for upcoming months, it’s important to remember that some of these fixed costs may change due to inflation or other external factors. Be sure to factor in any potential changes when creating your restaurant budget so that you won’t be taken by surprise if these costs increase in the future.
Factor In Variable Costs
Once you’ve subtracted your fixed costs, you can begin to factor in variable costs such as food ingredients, labor costs, and other operational expenses. Whenever possible, try to calculate an estimate of what these costs will be for the upcoming month so that you have a better idea of how much money you’ll need to set aside.
It’s also important to consider any potential changes in the cost of ingredients or labor due to market fluctuations or inflation. Staying on top of these changes can help ensure that your budget accurately reflects the actual cost of doing business in the coming months. Additionally, don’t forget to include any additional expenses such as marketing or promotions that may be necessary to help you stay ahead of the competition.
Creating a restaurant budget can seem like a daunting task, but it doesn’t have to be. By taking the time to accurately calculate your average monthly sales and subtracting fixed costs, you can get an accurate picture of how much money you’ll need for variable costs in the upcoming months. Additionally, tracking changes in ingredient prices and labor costs can give you an idea of where adjustments may need to be made over time. Taking these steps will help ensure that you’re always prepared for any potential bumps along the way and make it easier to manage your restaurant’s finances.