In our past few posts we’ve talked about utilizing budgets and how it is both good for your guests as well as good for your team members. All extremely vital aspects to why you need a budget; However, there’s one piece of the puzzle that we haven’t talked about yet. It’s the piece that every operator seeks to find; the one that once they do find it, they strive to hold onto tight. Profit. It’s a pretty simple concept right? Budgeting is always good for profit. So simple to conceive yet we still see countless operators who are well aware of how imperative it is, yet they still refuse to implement proper budgeting strategies. It’s absurd.
Let’s say you want to continue to build your restaurant empire. You’re eager to see your culinary dreams come to fruition so you set out to find the perfect location, menu and team members to back your vision of an additional location. Hold up, and let’s take in the reigns a bit. Are you prepared for the financial demands that accompany running a second operation? Before you can even think about a second opening, it’s imperative that your first is successful. Without a Budget in place, how can you track the actual profitability of your joint versus the roadmap to success that you have created in your mind? Or maybe the dream is to only have one place. I’m willing to bet, however, that eventually you will want to retire or at the very least, start taking more vacations. No matter how much you love your job or your joint, those sandy beaches with a few Mai Tais and your honey will never stop haunting your dreams. Having a well-oiled machine that is powered by a budget and talented team members is the only way to turn that dream into a reality. Besides showing you what your potential profit could be, budgets do a great job showing you where you need to invest in your business in order to hit your budgeted profit goal.
Let’s look beyond your dreams of expansion or retirement and think about the present. You have to keep in mind how quickly this industry changes. You absolutely must keep up with the times. Although your concept may be successful, as the years go by you need to keep it fresh and current. Upgrading POS systems, changing uniforms and replacing worn out furniture and/or equipment are some of the necessary evils to stay on top of your game. If you take pride in budgeting for those facets of your operation, your guests will continue to patronize your concept. On the flip side, without a budget in place, you will find yourself cash short and unable to address these issues which will leave you hoping that butts will fill your seats by doing the same things that you have always done.
The Myth of Sisyphus:
The myth depicts an absurd and tragic hero who lives life to the fullest, hates death and is subjected to completing a meaningless task over and over again. The similarities between Sisyphus and an independent operator are sadly uncanny; repeating the same task on a daily basis, yet expecting different results. The idea is absurd! If you continue to operate without a budget, yet expect to see different results, you will never break the cycle of insanity and you will never find that missing piece of the puzzle that you’ve been searching for. Honestly. Wouldn’t it be so much simpler to take the time and sit down to execute a strategy that will allow for emergency funds, or help you anticipate future expenses, so that when Your GM notifies you the day before St. Patty’s Day, that your cooler is out, you’re cool as cucumber because your budget works like a crystal ball and you left yourself some wiggle room for situations just like this? Don’t be Sisyphus.