Pizza Today - March 2017 - 68

To address the first hurdle, I say
'why not?' Why do some indepen-

dent pizzeria operators not maintain
financials? Simply this: they are not
looking to the future, so they do not see
the need to maintain accurate records.
Receipts for purchases get lost and sales
are not accurately entered. The resulting
financials cannot be used for current
management or for future growth. Trust
me. If you don't pay now, you will pay
later. Accurate sales and cost records are
the price you pay for admission to what
I call 'The Game.'
Let's take a look at hurdle number 1, the "why."
* Bankers: To borrow money for

growth, you have to show a minimum
of two years of good financials.
* Landlords: To get exceptional
locations (location, location, location)
those same good financials give you the
edge against the 'big boys' competing
for that space.
* The Government (a.k.a. The
Man): As you grow, you will be under

more scrutiny. The Man loves accurate
financials, and offers great incentives on
your tax return.
* Profit: Good financials allow you to
manage labor and food costs as well as

6 8 / P I Z Z AT O D AY. C O M / M A R C H 2 0 1 7

utility, maintenance and remodel costs.
Unfailingly, I have seen a minimum of
five percent (of sales) improvement in
costs when accurate financials are added
to a pizzeria's operational toolbox. On
$500,000 in sales, that is $25,000 in
your pocket at the end of the year.
* Employees: When managers' goals
are set based on their ability to understand financials, they blossom. They
understand how to lead the employees
to accomplish food and labor goals each
day.
* Your accountant: Your tax pro
can't do your taxes correctly if you are
not providing all of the information.
There are legitimate expenses you may
be missing.
So we now arrive at the second
hurdle - the "how."

There are many paths to success with
financials. Here are my players.
* The Manager: Every Monday,
the manager of the pizzeria spends six
hours doing weekly paperwork. This
begins with an inventory of every item
in the restaurant, followed by creating
the weekly food order. They complete
the daily paperwork, then a weekly sales
report showing weekly totals of sales,
credit card deposits, bank deposits and

cash paid outs. Next is the "cost analysis
worksheet." Food and labor numbers
are compared to sales. Sales are compared to last year, last month and last
week. Every two weeks a payroll report
is created. Once per month, a monthend inventory is created.
* Pre-bookkeeper: All of the manager's work comes to this person. He
sorts the paperwork as follows: Payroll
to the payroll company. Placing weekly
food orders to the various vendors.
Invoices and weekly sales reports to the
bookkeeper. Fundraising and donations
to the marketing person. Cost analysis
worksheets to me.
* Payroll: We use an outside company. There is too much legality to do
internally.
* Bookkeeper: The bookkeeper
enters all the manager numbers and
inputs all invoices using QuickBooks.
Each week, all the checks are attached
to invoices ready for my review and
signature. Monthly P&L statements are
prepared by location and monthly bank
reconciliations are completed. Monthly
and quarterly, sales tax returns are filed.
* Accountant: A professional who
reviews the financials quarterly, including the balance sheet, and prepares the
tax returns annually.
* Me: I review the monthly P&L
statements and provide corrections to
the bookkeeper. I review the P&Ls
with the managers and pay bonuses
based on results.
I have seen many owners make
money but who are not able to grow
their business because they were lacking
good financials. Are you ready to play
The Game? Remember my mentor
Roger Duncan's adage: "Sales are made
in the stores; profits are made in the
office." n
DAN COLLIER is the founder of Pizza
Man Dan's in California and a speaker at
International Pizza Expo.
http://www.PIZZATODAY.COM
Pizza Today - March 2017

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