Accountants for hospitality businesses

There are many rostering systems out there and each one has its pros and cons that may or may not suit your business. In our experience, Deputy is a powerful and dependable rostering system that connects directly to Xero and can handle the needs of most small, medium and large hospitality businesses.

Each business must individually determine the optimal staff arrangements for its circumstances. We can help you decide what sort of set-up best aligns with your short and long-term financial goals. In some situations, it can be more cost-effective to move casual staff into part time roles, particularly if they are regularly rostered onto weekends and public holidays. Award rates are constantly changing and it's important to seek advice from hospitality accountants to manage these changes profitably.

Keeping track of GST-free foods is best left to an experienced bookkeeper. Some examples of GST-food include:

• Bread and bread rolls without icing or filling
• Cooking ingredients such as flour, sugar and cake mixes
• Fats and oils used for cooking
• Milk, cream, cheese and eggs
• Cooking spices and sauces
• Fruit juice containing at least 90 per cent by volume of juice
• Bottled drinking water
• Tea and coffee (unless it's ready to drink)

The margins for hospitality in general are very tight, which is why it's essential to put a precedent on managing costs and ensuring your pricing is correct. For a cafe with a revenue of $500k+ per year, you should be aiming for a gross profit of 60% to 65%. Employee wages are generally around 30% to 35% so net profit before owners salary will ideally average around 8% or up to 15% for the better businesses.

The two most important questions to ask yourself before expanding your business or opening a new location are:

1. Does my current business have reliable staffing and procedures in place? These procedures can be replicated at the new location/s and allow you to transfer administration, staffing and bookkeeping systems.

2. Do I have sufficient funding to support the new location? A proper budget must be created and maintained for the build and construction of any new business. Once this budget is created, you will also need to ensure you have adequate funding from financial lenders or other investors. Too often poor planning for expansion can lead to not only the new location failing, but the demise of the existing and formerly thriving businesses.

To be able to answer that question correctly you are going to need to deep dive into your business and its profit margins. The increased popularity in food delivery services can undeniably help drive revenue for your business - but unless that equates to increased profits, it may not be worth your time. With the price of goods already being 30 to 35 per cent of your business costs, adding on an extra 25 to 30 per cent for the delivery service can severely affect your business's profitability.

A thriving business may still be able to profit from using food delivery services but it is key for you to understand how to track this and manage staff effectively to get the maximum profit out of these services.