Am I missing any “typical” monthly business expenses as listed below eith my projected expense and do you mind sharing what the $$ is for each expense? Going through all my projections one final time to make sure I am on track, thanks.
PS Gas ovens
GAS - $1000
ELECTRIC - $312.50
WATER - $375
SEWER - $93.75
GARBAGE - $125
PHONE - $93.75
INTERNET - $125
CABLE TV - $125
PAYROLL - $15125
LEASE/RENT - $6162
TAXES - ?
INSURANCE - ?
BANK LOAN PAYMENT - $2500
Driver Fuel Reimbursements (if you deliver) - About $500/month for us.
Credit card discounts - Roughly $600/month for us.
Employee apparel (if you’re providing uniforms - I average about $100 per month on this.)
Accounting/Legal Fees - Only 3 bills or so per year, but it comes to about $60/month when averaged.
Licenses and Permits - City, Fire, Health, Liquor - I have about $1350 per year on these, or $112.50/month.
Smallwares like shakers, cutters, turners, silverware, plates, pizza trays… You buy them all and never think you’ll have to replace them, but you will. They get worn, broken or thrown out. We actually drop about $70/month on average to replace smallwares.
Linen service - not sure if you’ll use it or not, but I spend about $120/month. That’s to launder towels, aprons and mats.
Maintenance expenses - Not a lot at the beginning, but by the end of your first year you’ll start accumulating them. Both equipment and building will start needing repairs. Last year we spent $1100 on building repairs, so almost $100/month.
Your list looks almost identical to how mine looked when I was doing projections. I never gave any of the above much thought.
A side note: Your water and gas bill estimates seem a little high. I have 2 Blodgett 1060’s, a 3 well gas steam table and gas furnace. Even in the dead of winter my gas bill has never been above $400.
My water bill has never been above $40.00, and we do 70% dine-in. The dishwasher almost never stops when we’re busy.
You have several I had not even thought about. I will add them in for sure. The gas bill is somewhat of a shot in the dark. I called our local gas company with addresses of similiar shoops in our town (pizza, itilian etc) to get monthly estimates of their gas usage.
I took that number and added 20%. I guess it is better to be over than under at this point. I was quote $1.01 per therm from the gas company if this helps.
WOW, 6000 in monthly rent? I am guessing a reasonably sized place. I cannot imagine that even though the ovens will be gas, that electricity will be that low. An oven will make an AC work overtime. Internet at $125 seems extreme.
[quote="snowman
WOW, 6000 in monthly rent? I am guessing a reasonably sized place. I cannot imagine that even though the ovens will be gas, that electricity will be that low. An oven will make an AC work overtime. Internet at $125 seems extreme.[/quote]
The rent won’t actually be that much, but I am trying to take what I think/know is the actual amount and adding in at least 20%. Some of the totals could be way too low or too high. I prefer the high side for these projections.
My overall goal is to look at the break even point and profitability point. If all idications say yes we can do this, full steam ahead. If the numbers are marginal or in the red, its time to pull the plug and let it drain.
The only water usage will be mainly from a Hobart dishwasher, we will be fast casual with non-landfill utensils, thus the dishwasher. We don’t get real hot in the NW so summer AC will be minimal
Looking at Blodgett 1060 double stack ovens and a tankless H2O heater for main gas use. No fryer and we will use CF lights bulbs
Alarm, forgot about that one. For projected sales I am trying to make everything work at $6500 to be safe, but I really think our ticket average will be closed to $20-22 as a dine-in for families. Out town sells about 3500 pizza a week (asked every pizzeria in town). The two slowest places in town sell about 400-450 pizza a week, so we should at least be able to match them. At $20 average we are looking at $8-9K a week.
I just don’t want to open the doors and find out we were too low on the expenses and too high on sales and bomb out our first year. It is such a gamble from any aspect I want to give us the best chance possible.
Marketing, I forget this monthly expenses as well!
Two expenses that I have that I didn’t notice on your list are Sign Rental (for the plaza sign) and Auto (lease or loan, insurance, as well as gas and maintenance). I also allow $200 for maintenance costs like HVAC filters, grease trap cleaning, or any other little thing that happens to go wrong and not covered by warranty.
Don’t forget about your payroll taxes. That’ll hit you to the tune of around $2,000 or so per month. You plan on hiring an accountant? A good marketing program should run between 5% - 8% of your net sales.
You also stated you flat out asked other pizzerias the number of pizzas they sold in a week. Have you given any thought to the possibility that they lied to make themselves look better?
Don’t forget about store insurance, hired and non-owned auto, and worker’s comp insurance. That’ll run you between $600 - $3000 per month depending on who you go with and what type of operation you have. Your credit card processing will be around $300-$400/month.
It is possible, but I used this line on them. I was taking classes at our local college and doing a paper on the importance of comfort food in our society including pizza among other things. I followed up with several questions on what they sold, the busiest nights, average highs and average lows etc.
Everyone was more than willing to help me out with the information I needed. Being small town also helps as most everyone is friendly.
Do you think these numbers sound decent or inflated?
Domino’s - 875 week
Papa Murphy’s - 600 week
Central Market Pizza - 900 week
Seabeck - 500 week
Westside Pizza - 500 week
from my experience with them, I doubt it.
unless there is some big commercial unit that would work
I am familiar with the residentual ones, the work OK for showering, but do not get that hot, maybe 110,
Otis
A couple weeks ago I called my grease trap guy to come out. He never called me back. So I went to Lowe’s (think Home Depot if you don’t have one in your neck of the woods) and bought a Shop Vac for $40. I sucked it dry and chucked the whole thing in the dumpster afterward.
Grease trap guy = $110/visit.
“Disposable” Shp Vac = $40.
Hmmm Good point I need to check this out a little more. Was thinking tankless from the environmental stand point. I figured we would need a external heating unit for the dishwasher regardless of the which water heater we use. I think the water temp has to be in the 165 range IIRC
Again big thanks to the regular posters and anyone else that has chimed in. I really appreciate all the help, great community. I am still working on the FAQ list and should have it over to Tom so we can figure out the best way to post it for everyone to use.
Check the websites for the manufacturers. As with any other water ehater, it’s about the BTU’s you pump in that heats the water. If I had a 20 gallon tank in my shop, we’d never get hot water . . . however, with 2 40-gallons doing almost 80KBTU, we do well.
Rinnai has some pages online that suggest they have put together untis in series for restaurants in the past. check with you local health Dept and a manufacturer who actually knows abuot the products and capabilities.
BTW, I use a low temp warewasher in my shop. Water temp needs to be around 125 to 130, and it uses a chlorinated chemical sanitizer rather than 180F heat for sanitizing. Lots of machines for lots of applications out there. Again, talk to a machine guy about the needs, costs and capacities you will need. We may end up moving to a heated rinse/sanitize machine later when we get to more sitdown diners . . . maybe a continuous feed track machine one day. For now, $70 a month for the low temp machine is worth my money.
Is the $70 a month you mentioned for the chemicals for the dishwasher or something else? I will get some research done on this subject. During my thought process it seemed to make sense not having to spend $$ heating water that was not being used during our closed hours. However in a practical sense it may not work.
I guess this is the difference between wishfull thinking and reality.
the $70 (maybe $75) is the lease on the machine. We also have an obligation to buy chemicals from the company . . . something like $100 or $150. Nothing really outrageouos once we get rolling.
Check with the food distributors. They will all have some sort of program with Clean Force or EcoLab or someone like that for the machines and chemicals. All sorts of chemicals and all sorts of mchines for needs. If you want to buy a machine, be sure you talk with these guys first to see what is available in machines and features before deciding.
I personally hate paying rent on a machine I’ll never own . . . but compared to paying the labor costs to wash dishes by hand every night? It is still quite sane to rent! Heck, it pays for itself inside a week just in labor costs for me. And I get it repaired at no cost if it breaks down somehow.