Manage Your Restaurant’s Upgrade Budget
Your wait staff is good. Your bar is great. Your food? Amazing. You’ve painstakingly cobbled together every detail of your dream restaurant and now you’re assessing your budget and
GASP! How much money will it cost to create that ambiance, that je ne sais quoi that keeps customers coming back again and again?
Don’t worry. It’s totally possible to continually upgrade your restaurant without blowing up your business credit cards or destroying your business budget.
Create a Gradual Upgrade Plan
Whatever upgrades and wild visions you have for your establishment can be made possible. They are a result of carefully tended savings goals. If you can seriously commit to saving a certain amount of profit on a monthly basis and dedicating that money to a specific long term goal, it can happen. That’s what running a business is all about.
Keep Your Vision Clear
But what is most crucial when it comes to bringing a gradual upgrade plan into fruition? Easy: the clarity of your vision. So take some time to get real with yourself about what you most want, how it fits in with your desired end goal, and exactly what you need to budget to get there.
You can slowly upgrade as your business comes in, OR you can do a promotional grand re-opening aimed at showing off your new digs. Creating a budget that works with your vision is the best plan.
When it’s time to get all new glassware, better seats, upgraded menus: go for it. Give yourself a do-able profit margin goal and when you hit it, splurge. Upgrade to your heart’s content. Let your spirit soar!
You can do it all without cutting into your actual spending budget.
How to Budget Based on Profits
Casual, fast casual, and full-service restaurants all average a 6%-6.1% net profit margin (this is how much profit you make after accounting for all spending and fixed costs).This means that for every dollar your restaurant spends you could get an average of 6 cents back.
We did the math: if you dedicated 1 cent out of those 6 to saving for your goals that would be $166 out of every $1,000 dollars of profit OR $833 out of every $5,000.
It’s not much, but you can always increase the savings rate. You should always keep some of that cash on hand for emergencies, but having extremely clear goals can help you spend your hard-earned profits on what you REALLY want instead of blowing it on smaller things that crop up.
Nobody Can Do It Like You Can
Remember, that special touch you want is already there. It’s you. It’s the work, focus, and attitude that you bring to work every day. It’s the way you treat your employees and customers. And it’s also the way you approach your budget.
Even if you are a fine dining maverick who makes 10% net profit margins, it’s still important to save money with your visions in mind.
As a small business owner it is up to you to keep track of your monthly income, start saving, and make your goals happen.