July 28th 2010
There is no way you can be considered for, let alone achieve, a top hospitality dream job without walkin’ and talkin’ dollars and cents. You may be a front of the house/heart of the house expert, but to grow or perhaps, at times to survive, you may need to travel beyond your personal network to obtain money. It doesn’t matter if it is the bank, the boss, or the street; they won’t speak the language of your passion, expertise, or dreams. They will, however, require you to display your business and financial acumen (on paper, as spoken in percentages of minimized risk and maximized rewards).
In business, cash is queen (or king, if you prefer). Gotta make it, gotta use it, gotta get more, and gotta keep what you got. It took me a long time to realize that there is an imperial collective of people who use “money know-how” (financial fitness acumen) as their entrée into the top jobs. And you are nothing to them unless you “know da know.” (Come on, now; “liquidity” is a word you use everyday, no?)
Most people who have more money than you will talk money better than you. Here is the short version of almost any money conversation: “Why should I/we give you money instead of doing other things with it?” Buy into this premise; you will have to compete numerically to justify/prove your viewpoint. Potential investors will analyze and compare your projected results to, not just your history or industry averages, but other—and perhaps more fruitful—ways of investing their money (also known as projected return on investment or ROI). This is why you must track all that comes in and all that goes out, not just to pay the bills and buy some fish, but to compete at every level. Percentages and comparatives do not require high-level trigonometry, just attention to detail, total commitment, and an understanding of why they matter.
When you begin to hear the following questions, you’ll know that your knowledge of the royal language is being tested:
- What are the sales per square foot of your store?
- What are today’s sales per labor hour or productivity?
- What is your annual staff turnover ratio running?
- What is the current net profit margin on these sales?
- What are your actual sales “running” when compared to budget?
- What is your year to year “comp” sales percentage?
Do not become a person who shows him- or herself to have little interest in the royal language (“…I dunno”). If you do, it will only be a matter of time before you are labeled as one of the lost souls who don’t “get it.” If you want to get ahead of the curve, you can prepare yourself by delving into the industry “numbers story.” Start with specifics such as the “ideal” food, beverage, labor costs, gross, net, and so forth. After that, break down the store’s monthly profit and loss statement (P&L) and get to know it backward and forward. You might then grab the chart of accounts for your store (the snail-trail of all the money out) and read and reread it until following along becomes second nature.
The truth is, your ultimate success in the hospitality business will at some point come down to whether or not you are fluent in the royal language… of any business.
Tags: Budgets, Chase LeBlanc, Financials, Foodservice Manager, Great Manager, High Impact Hospitality, Hospitality, Hospitality Industry, Hospitality Manager, Leadager, Leader, Numbers, Restaurant Manager, Restaurants, Royal Language, Sales