While there are numerous considerations when choosing the right accounting service for your restaurant or bar, these 4 guidelines will help ensure you’re on the right path to begin your search.
1. Determine your specific business needs and goals
There are a variety of options a restaurant operator can review when it comes to choosing an accounting service.
First and foremost, the most important factor is ensuring that the accounting service is hospitality-specific. There are countless accounting services available. However, without the vast knowledge of the specific nuances linked to the restaurant industry (i.e. regional labor compliance, restaurant-specific reporting, etc.) it would be akin to seeing a generalized Physician when in fact, you need a specialist.
Aside from hospitality-specific accountants, there are additional components to take into consideration. Many offerings are purely software-based and carry the heavy load of transactional accounting for the restaurant operator. Most often these software-based offerings don’t include the human element of service and local support.
Next, there are local accountants, who are hands-on and can provide a second set of eyes for your books. Local accountants typically do not provide any technology or software needed to dive into the operational side of the business. Moreover, local bookkeepers do not possess the specific skill set that restaurants require for financial accounting and compliance practices versus traditional operational accounting. This almost always creates more work for the operator as they are caught between an authority figure without experience and a system with no controls.
Lastly, there is the combination of software and service. Managed Finance as a Service (Faas), or tech-enabled services, offer a unified technology platform with a team of industry experts for support and education. This type of accounting service provides experts to help set measurable goals and support the tactics to attain those goals, combined with purpose-built software to achieve financial and operational success.
As with any major business decision, it’s paramount that you balance all the needs of your business. This is the only way to ensure a successful outcome from your decision. Utilizing the decision-making triangle helps to do so. Ask yourself if your choice has a positive effect on your guests, your team, and ultimately, your profits. If the answer is “no” to any of those, you need to reconsider or reframe the activity.
2. Determine your budget for an accounting service
Once you’ve determined your restaurant’s specific needs for financial and operational accounting, it’s essential to determine your budget for the services.
If you do not budget properly, it will have a strong negative effect on every aspect mentioned above (guest, team, profit). Without having specific goals and targeted costs, you simply won’t be able to turn a profit. Ask yourself how much you’re willing to spend for additional in-house employees to perform the same accounting functions, versus hiring an outsourced accounting service. Outsourced accounting can save you up to 60% in fees compared to an onsite-company employed bookkeeper.
The cost to outsource can seem high at first blush. It’s important to realize the amount of money you can ultimately save over time. This is especially relevant in an industry where compliance regulations, tax implications, and changing legislation can rack up fees that can cripple a business.
Furthermore, the additional time savings (remember, time = money), plus the oversight and accuracy that an outsourced accounting service can provide over an in-house employee performing the job, can skyrocket your return on investment.
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3. Determine if the company is a good fit
Establishing the right fit for an outsourced accounting service is undoubtedly one of the most important factors when choosing a firm. Making sure your operational and financial objectives align with how an accounting organization handles business, is key to success. For example, a few important aspects to consider are the following:
- Does the accounting service possess the experience necessary to understand my core issues and goals?
- Can the service help to establish distinct roles and responsibilities for my team?
- Will the service offer a collaborative approach between our businesses?
- Does the accounting service provide the level of engagement and support that’s needed for my business?
Setting your team up for success by providing them with the proper tools is the only way for your business to grow.
Making sure you choose the right fit for an accounting firm is about as important as ensuring you’re not sticking an American plug into a European socket. If it doesn’t fit, it will not work.
4. Ask for references
Finally, leverage your personal network when looking for an outsourced accounting service. Undoubtedly, the restaurant industry is a tight-knit group. Listen to what’s worked for your colleagues and who they’ve worked with to help achieve success. Additionally, outside of your colleagues, any organization should be willing to provide references for their work. Don’t be afraid to get specific. Ask for the contact information of the owner or operator with a similar restaurant size or concept as yours. Understanding how others have found financial profitability is the quickest way to take action for your own successful future.
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