Restaurant industry sales are expected to hit a record high of $709.2 billion in 2015, according to the National Restaurant Association. In the first four months of 2015 alone, restaurant sales were up 9 percent according to the Census Bureau, which tracks official retail sales numbers. However, as restaurant sales continue to rise, cost pressures such as minimum wage and ACA regulations are making it increasingly more challenging to operating a restaurant. In a low margin business where every penny counts in the drive to maximize profitability, restaurants need to be hyper focused on cash flow as well as return on investment.
Managing spending is critical to financial profitability. Denny’s operators use “back-of-house” systems in order to keep a tight handle on food, beverage, labor and other costs that are within their control. However, keeping a close eye on controllable costs alone is not enough. Key financial benchmarks can help Denny’s operators identify potential issues before they become problems.
IQ BackOffice provides state-of-the-art accounting systems that integrate with “back-of-house” systems to accurately capture not just food and beverage purchases but all financial transactions in order to provide accurate reporting and metrics. These benchmarks allow Denny’s operators to track their profits, losses and cash flow, and also be able to compare key performance metrics for comparison with other Denny’s restaurants and restaurant industry benchmarks. Such comparisons highlight areas of opportunity to optimize profitability for your individual business. Other key liquidity and profitability ratios are vital to bankers to whom restaurant owners might rely on for financing or investment.
“IQ BackOffice provides Denny’s operators with timely and accurate financial statements and key industry benchmarks. As a market leader in web-based accounting solutions, we provide complete process transparency and faster access to information, says CEO, David Schnitt. “IQ’s accounts payable, accounts receivable, and payroll services deliver significant process improvements lowering client costs. This allows Denny’s operators to save money, make better decisions and have stronger financial controls.”