If you’re in the hospitality industry, it’s essential to make sure that your bar, club or restaurant accounting is in order. In this blog, our team of registered accountants have put together their top hospitality tips to help you and your business succeed.
1. Use leverage technology
Leverage technology is that which optimises operations, creates greater efficiencies and ultimately maximises revenue. Many businesses use leverage technology to streamline their work, and knowing how to do it can help you succeed.
There are several ways to make the accounting process easier and more convenient for your hospitality business, including using an online accounting system specifically tailored to the industry.
Specialised accounting software is one of the best forms of leverage technology to use to aid your financial management for your hospitality business. Replacing the manual, more time-consuming accounting process, where data had to be inputted by a member of the team using a complicated spreadsheet or even pen and paper, modern accounting software is a quicker and easier way to ensure that you have all of your financial information recorded and readily available when you need it.
Cloud accounting software is especially useful if you want everything in one place. It ensures that your hospitality business’s financial information is always at your fingertips. Your clients and employees also have access to the same software, making it easier for them to check payroll, request holidays, and make any other changes. Our team of registered accountants would recommend using Xero.
Project management and customer relationship management are also great leverage technologies. They can help organise business operations and make in-house collaboration as well as external communication more efficient. By monitoring progress and results, you can decide on your next steps with more confidence.
2. Understand tax relief opportunities
Another of our registered accountant’s top hospitality tips is to thoroughly understand and utilise your tax-deductible expenses. This can save you and your business money.
Capital allowances are one of the main examples of tax relief for your hospitality business. If you own a commercial property, used for the running of a hotel, restaurant, bar, or cafe, you may already have unclaimed tax relief in the form of embedded capital allowances. If your business is just starting out, make sure that you claim these capital allowances.
Capital allowances are on items such as commercial kitchen equipment, toilets, fire alarms, security systems and lighting. Essentially, you may be able to claim on most items you buy or install during the initial fitting-out process in your establishment. You may be able to utilise a new Super-Deduction introduced by the government and claim a 130% tax deduction.
You can also claim R & D (Research and Development) tax relief. If your hospitality business develops new products, processes, or services, you may be eligible. It is more likely that you will be successful in your claim if you spend money on your innovation, particularly if it focuses on sustainability or environmentally friendly practices.
3. Go cashless
Hospitality businesses have welcomed the change to cashless payments over the past few years, something accelerated by the Covid-19 pandemic. However, what is the real benefit of going cashless? Our registered accountant reveals the advantages of card-only businesses.
Quicker transactions do not just convenience guests (credit payments can be made, using credit cards) but improve service and efficiency for servers and the business as a whole. Additionally, card payment transactions reduce the risk of human error and labour or training costs.
Cashless businesses are also usually more secure. By just accepting card payments, you will hold no or minimal cash at your premises, meaning that they become more secure and the risk of fraud or theft is reduced. Counterfeit money is also no longer a risk.
Running a card-only operated business means that bookkeeping becomes less complicated. It is easier to record and track transactions with certainty. Finally, going cashless is also a great idea if you wish to offer discounts and loyalty benefits. These schemes become easier to run and implement.
4. Ask for advice
By following these simple hospitality tips, you can save yourself from future headaches down the line. However, if you’re not sure where to start, don’t hesitate to seek out professional help from a registered accountant or financial advisor.
With their help, you can set up the right systems and processes so that you can concentrate on what you do best: making your business successful! Advice from an expert will also allow you to establish the best practices and ultimately be more confident in your financial management.
Accounting is a vital part of the hospitality industry as it enables businesses to gain valuable insights into the financial status and overall profitability of their restaurant, bar, or cafe. It is therefore not worth compromising on. If you are struggling to keep up with it all, why not outsource your finances?
5. Consider outsourcing your finances
Effective management is crucial to the continued profitability and success of your hospitality business. Financial management, such as payroll, plays an especially important part in this. Outsourcing your finances will not only save you time but will ensure that you are being accurate as possible in the recording of your business’s finances. This reduced risk of error or inaccuracy can provide you with peace of mind.
At Steele Financial, we have a Full Finance Department, designed to take all financial admin off your business’s hands. This personalised service offers full flexibility. If you only need bookkeeping help, for example, we can provide you with just this. Similarly, as your business grows your requirements may change. Our registered accountants can work with you to add or reduce services as necessary.
Hospitality industry accounting can certainly be challenging and time-consuming. If these hospitality tips inspired you to get more help for your business, get in touch with one of our registered accountants and we can make you a tailored plan.