“I’m not a numbers person.”
I have heard this from many business owners during more than ten years of working with hospitality businesses.
Yet restaurant owners work with numbers every day.
They know when a service is understaffed, when supplier prices have increased, which dishes are selling and when a venue is quieter than it should be. They make decisions about rotas, menus, stock, pricing and customers—often under considerable pressure.
The problem is not that they cannot understand numbers.
It is that their financial information has often arrived too late and been presented in a language created for accountants.
When the Numbers Stop Feeling Like Yours
You probably did not open a restaurant because you wanted to study accounting reports.
You had an idea, created a menu, found a location, recruited a team and attracted customers.
Then the paperwork began.
Invoices, receipts, payroll, VAT returns and bank reconciliations became part of running the business. Reports arrived filled with accounting terminology, and it became easier to leave the numbers to the accountant.
That can work for meeting tax and filing deadlines. But it does not necessarily tell you what is happening inside your restaurants today.
A set of annual accounts may confirm what happened last year. It cannot help you change last month’s staffing levels, investigate a falling food margin or decide whether you can afford another manager.
For that, you need current financial information that you can understand and use.
Technology Has Changed the Story
Older accounting packages were often designed around accounting terminology, complicated menus and processes that made sense to accountants but not necessarily to business owners.
Xero was created differently.
It was founded in 2006 by technology entrepreneur Rod Drury and accountant Hamish Edwards. Drury had become frustrated by how difficult traditional financial software made it to extract useful information.
The combination mattered.
One founder understood technology and the experience of running a business. The other understood accounting and the importance of producing reliable financial records.
They helped create cloud accounting software that allowed business owners and their accountants to work from the same current information.
You no longer need to wait until your accountant has collected and processed months of paperwork before you can see what has happened.
Restaurant Bookkeeping Can Be Part of the Daily Routine
Today, capturing financial information can be surprisingly simple.
When a delivery arrives, a restaurant manager can check it and photograph the paperwork using a phone.
If an invoice arrives by email, the PDF can be sent directly into the accounting system.
Bank transactions can feed into Xero automatically. Sales and payment information can also be brought in from other systems used by the restaurant. Used properly, Xero for restaurants can bring this information together without asking managers to become bookkeepers.
The manager does not need to decide how the transaction should be treated in the accounts. Their role is simply to make sure the document reaches the system while it is still current.
The bookkeeper or restaurant accountant can then check the information, correct anything requiring professional judgement and make sure the accounts are accurate.
That is very different from placing invoices in a drawer and trying to explain the payments several months later.
AI Is Now Completing Much of the Repetitive Work
AI is making the process even simpler.
Xero’s AI can automatically match and categorise bank transactions when it has enough confidence in the result. It can use bank rules, existing records and previous transactions to determine how an item should be treated.
Transactions requiring attention are left for the bookkeeper or accountant to review.
This does not remove the need for professional oversight. It removes much of the repetitive processing.
For a restaurant group dealing with large numbers of transactions across several venues, that can save considerable time and help keep the bookkeeping current throughout the month.
Instead of spending hours manually matching every payment, the accountant or bookkeeper can concentrate on the exceptions, check the accuracy of the information and explain what the figures mean.
See the Profit Behind Each Venue
For a restaurant chain, knowing the group’s total profit is not enough.
You need to understand how each restaurant is performing.
Xero tracking categories—sometimes called tracking codes—can be used to assign income and costs to individual venues.
A tracking category called Venue could contain separate options for Bishopsgate, Soho, Canary Wharf and Clapham. Sales, supplier invoices, wages and other costs can then be allocated to the correct location.
Imagine that two restaurants each generate £100,000 in sales.
A report showing only the group total records £200,000 of revenue. It may appear that the venues are performing equally well.
The profit and loss report by venue could tell a very different story.
One restaurant may produce a healthy profit while the other makes very little because of higher staffing costs, food waste, overtime, supplier prices or delivery commissions.
The owner can now see where the difference is arising and investigate it while there is still time to act.
For multi-site restaurant accounting, consistent venue tracking turns a combined set of figures into useful management information. That is the purpose of accounting for restaurant groups: not simply recording how much money entered the business, but showing where profit is being created and where it is being lost.
Your Accountant Becomes the Guide
Technology does not replace your accountant.
It changes how you can use them.
When the restaurant bookkeeping is current and much of the repetitive processing has been automated, your accountant has better information and more time to interpret it.
Instead of spending the conversation searching for missing receipts, you can discuss profit by venue, food margins, labour costs and restaurant cash flow.
Instead of discovering a problem in the annual accounts, you can identify it through monthly management accounts and take action sooner.
Your accountant understands the financial information. You understand the restaurants, the customers and the decisions that have to be made.
The most valuable results come when those two forms of knowledge are brought together.
You Were Never “Bad at Numbers”
You do not need to understand debits and credits or every line of an accounting report.
You need the right information presented clearly and connected to decisions you recognise.
Today’s technology can collect and organise the information. AI can complete much of the repetitive work. Your accountant can check the figures, explain what matters and help you consider your options.
You remain the person making the decisions.
In my previous article, I explained how keeping your records current creates more room for your accountant to become a useful adviser.
In the next article, I will share the questions many business owners have never thought to ask their accountant. They are not the usual questions about tax, VAT or annual accounts—and the answers could completely change how you see your business and what you decide to do next.
At JERN Financials, we provide accounting for restaurant groups and hospitality businesses, using Xero, restaurant bookkeeping and monthly management accounts to show profit, margins, staffing costs and cash flow across individual venues.
If you would like clearer financial information across your restaurant group, book a discovery call:
Book a discovery call with JERN Financials
Esther Kyesimira FCCA
Founder, JERN Financials Limited