How to Take back the Driver's Seat of your Controllable Costs
How to take back the driver's seat of your controllable costs
Do you know how much was spent on food last week? Do you know if your negotiated cost prices per food item delivered were correct? Do you know that you haven’t double paid suppliers by mistake? Do you have access to up to date purchase data?
According to UKHospitality, controllable costs in the restaurant business have risen to the highest levels ever, at 53% of turnover. With the looming threat of a no-deal Brexit and shrinking margins, how can you take back control of your bottom line?
How technology is disrupting the Accounts Payable industry in hospitality
Technology creates a competitive advantage through better efficiency & productivity. The recent revolution in EPoS systems is a great example, allowing hospitality venues to gain a competitive advantage as it created better inventory management, made customer payment more flexible and convenient and gave the venue access to unprecedented amounts of customer data.
The next logical step in the digitization of hospitality processes is to automate mundane and repetitive tasks. Paying the bills takes a significant amount of time as all the deliveries need checked off against the delivery invoice to ensure everything has arrived, the costs are correct, the data is entered into accounting and inventory systems correctly, and approvals have been sought to pay the bills. Technology exists which can automatically extract line by line data in real-time including unit costs and quantities of each item, price check each purchase in real-time, enters the invoice into a digitised approval system, enters all the data in inventory and accounting systems and a document archive that can be used to create reports and insights on all your purchases.
To do all this manually takes up to 15 people at an estimated cost of £15 per invoice.
If the average restaurant and takeaway venue processes 2,000 bills p.a., that’s already an unbudgeted cost in the vicinity of £30,000.
Case Study - Gain competitive advantage by automating repetitive tasks
60% time saving
In our case study, 1 restaurant group was able to save up to 60% of their time through automating the data entry and approvals process. As all data is extracted with 100% accuracy that means you have no typos to worry about in your accounting or inventory systems, therefore no time spent correcting mistakes. With all your bills and invoices digitised in an approval process, nothing can get lost meaning you don’t need to get invoices reissued. Automated price checking also saved thousands of hours across the business as invoices no longer needed checking for correct prices.
Automated price checking of food deliveries
Our case study the restaurant group reported that by loading up the cost per kilo/unit of 20 of their most commonly purchased proteins into Lightyear, £10,500 of overcharging was identified in only a 3-month period. That’s £42,000p.a. that should have been in their bank account. Correcting this single problem increased food gross profits (GP) by 0.8%.
Any guesses as to the tune of the amount in which this particular hospitality group saved? £175,000. Yup, by taking the administration out of the hands of chefs and venue managers; who lets face it, aren’t in their chosen careers to push paper- it was reported that close to £100K was saved on food and beverage, and £75K was saved in head office by halving their accounting manual labor. The pennies really do look after the pounds.
For more information and to see how this can suit your business visit Lightyear at the Restaurant and Takeaway Innovation Expo to get your demo.
Get in Touch: Lightyear