One new client owned a restaurant and bistro. Before they became our clients, their previous accountants had simply processed their weekly payroll and charged a large fee for doing so.
When we met the client they were concerned because they were struggling to pay their VAT liabilities as they fell due.
A quick fact find showed that this was their first business and prices and portion sizes had been inherited from the previous owners.
A review of their VAT returns showed that their gross profit margin was 48%. The target gross profit margin for their industry is 65%. Something had to be done!
We helped them review their costings for every dish they sold to make sure they hit an average margin of at least 65%. We persuaded them to also negotiate volume based discounts with their key supplier.
What happened?
Previously there weren’t enough left of the takings after paying the staff and suppliers to cover the VAT and PAYE bills. Now, that money is put aside every day and there’s still a healthy balance left in the till when everyone is paid!
Using what they’ve learnt our client is now in a financial position to expand their business and will be opening a new restaurant soon!
Would you like to know what we can do to help you make more profit? E-mail us to arrange your free initial consultation.
