I am having some issues, My sales have consistently been going up, yet I am making no more money than before. infact it may even be less money. I am looking at having my accountant go over all of my paper work and bank deposits to see where I am getting gouged, however I am not sure if an accountant or my accountant is the right person for the job, can any body sudjest to me who or what they use to detect profitablily and or profit loss statements?
Thanks.
Have you done a profit and loss review to see where any costs have exploded - wages, cost of goods, etc.
Not long after I took over my store (and I was a real greenhorn in the industry) our sales starting going up but returns started coming down. I had put on extra staff to manage the “extra workload”, especially as I wasn’t in the groove of making, prepping etc.
I then lost my manager for 17 weeks with an injury and only partially replaced his hours. You know what? We did it on our ear without his input. I was fully operational in all aspects of the business and the workload didn’t seem as hard.
Just as he was about to return two casuals left us and we didn’t replace them. The manager came back and we are back to staff levels when I srated but sales are up. Now the returns are matching the increased sales levels. Our wages bill has come down from about 15% to under 20%.
We also looked at the amount of topping we were puttting on the pizzas and reduced them without compromising the quality or value. We also reduced the size of the pasta take away containers and reduced the quantity accordingly (they were always to much but this is what I inherited when I bought the business).
Over the last 6 months we ahve experienced major costs increases due to the serverity of the drought right across Australia plus the increases from the high fuel prices here.
At the moment I 'm working on price increases on our menu to allow for the cost of goods increases.
If you haven’t got one I suggest you get a programme that does a Profit and Loss report for you. This can be done anytime and it gives you a handle on where you are.
Dave
are suppliers raising prices?..check invoices
chances are somebody has a hand in the till…do drawer checks
Assuming overhead remains constant and sales are rising, profit should follow? Follow the Overhead and determine if your percentages are rising compared to the rate of increase of sales. If so determine where you can get a handle on your OH. Utilities, Insurance, Rent, Cost of Goods, Shrinkage, etc, etc
One of the MOST overlooked Overhead items is Credit Card fees. Most business owners ASSUME that everyone pays the same. Not True. Everyone pays what they agree to pay.