Connections for Success



Keys to a Profitable Restaurant

The primary goal of a restaurant is similar to any other business: Profitability. In today’s competitive market of countless restaurant options for consumers, restaurant owners are always looking for opportunities to increase revenues and profitability so that their business may both thrive and survive. The following are a few key ways a restaurant can achieve that success.

Point of Sale System
While some restaurants may have the resources of an in-house accounting staff to provide in-depth analysis, many restaurants without the in-house resource heavily rely on a Point of Sale (POS) system to help record their financial data. POS systems, when used properly, allow restaurants to run more efficiently by improving customer service, enhancing staff teamwork and functioning as a “control” mechanism, which helps the restaurant increase its profits. A POS system allows restaurant staff to input orders more quickly and help the kitchen make fewer mistakes. In turn, customers receive their food more quickly and the restaurant is able to turn tables – and serve more customers – faster. Additionally, the system allows restaurant management to see what menu items are popular, as well as what items are being ordered infrequently and may need to be removed or replaced.

Inventory Management
A restaurant’s inventory represents an investment in the food and supplies that are needed to make a profit. In addition to labor costs, food costs are usually the largest expense for restaurants. Inventory counts measure the amount of food, supplies and other products that a restaurant uses over time. This usage can be converted to a dollar amount, which is compared to the total sales figures for a given period. It is highly recommended that a restaurant count inventory consistently, often on a weekly basis using the same personnel – ranging from kitchen manager to general manager – for each inventory count. Good control of inventory should result in better foot costs, less waste and improved profitability

Establishing a method of tracking income and expenses is critical to a restaurant’s success.  Regardless of the size of restaurant, management will need to keep accounting records to understand the financial workings of their business. The POS system is an essential way to track all cash and credit card sales. All expenses should be documented by invoices and receipts and properly filed away. Some accounting functions, such as closing out register totals, should be performed daily. Payroll and other tasks can be performed on a weekly basis.

Restaurants that are able to effectively manage cash flow are able to maximize net income and see profits grow. The tips listed above will help a restaurant owner keep track of finances as well as put them in a strong financial position. 

If you have any questions, please contact Ken Kobiernicki or your ORBA advisor at 312.670.7444. Visit to learn more about our Restaurant Group.

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