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Operating a Restaurant Amid COVID-19

The restaurant industry is enduring hardship like never before due to COVID-19. As some restaurants pivoted, others closed, but now is the time to learn how to operate in a new environment. Best practices, from managing your workforce to managing cash flow, are now more critical than ever.

The following outlines a roadmap for restaurant owners to follow as you navigate managing staff, customers, and financials. Utilize our checklist to help you through the rebuilding challenges.

Rebuilding the workforce

Restaurant owners may now be in the position to rehire employees if they were let go as the pandemic unfolded. Given the situation, it’s important to establish guidelines and policies for employees.

If you have not done so already, consider creating a return-to-work program for employees. Establishing a plan that protects both employees and customers is paramount as your restaurant rebounds. A return-to-work program will also be helpful should you have to shut down again in the future. Consider what policies would have been helpful to you and your employees before you had to shut down or pivot your operations.

Restaurant owners will need to expand safety and sanitation methods throughout the restaurant. Consider including the following in restaurant policies:

  • Enhanced workplace sanitation
  • Managing workflows
  • Physical distancing
  • Resource requirements (PPE, signage, etc.)
  • Tracking workforce illnesses

Food and labour costs

Many restaurants are experiencing cash flow issues along with rising debt levels. Since the average annual cost of restaurant employee turnover is $146K, it’s more important than ever for restaurants to retain their workers, if possible. While most restaurants had to let go of their staff, now is the time to rehire staff. Restaurants might not need as many employees as they did prior to the pandemic, so ensure you hire an appropriate size staff for your needs. Analyzing customer traffic and available data will help you modify staffing levels accordingly.

Consider future food expenses and re-evaluate your budgets to help identify areas for further cost savings. With purchasing, negotiate payment terms, inquire about potential discounts, and consolidate vendors if possible.

Refining portion sizes and using prepared items to save on labour might also benefit restaurant owners. Take advantage of any available support to help restock your kitchen.

Cash flow

Restaurants should conduct regular cash flow projections, as high-quality financial information continues to be vital to your operations. Weekly reports are essential for accessing government funding, managing cash flow, and pivoting operations.

Restaurants need to account for any deferred payments, such as taxes, rent, royalties, and loan payments. If you’re having difficulty with creating reports, we can help guide you through the process.

How BDO can help your restaurant find its way back to profitability

With a particular focus on franchises and multi-unit operations, we offer collaborative and fully managed outsourced services, from bookkeeping and payroll, financial reporting, cash flow projections, human resources, to technology. Reach out to one of our professionals to help manage the financial challenges for your restaurant.

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