The Hospitality Industry
The hospitality industry makes up a large portion of the economy and is responsible for hundreds of billions of dollars of revenue every year. The industry includes everything from restaurants and coffee shops to spas, salons, and hotels. These businesses operate in fast-paced and often high-pressure environments.
Due to the challenging nature of the hospitality industry, many businesses become accustomed to operating in a state of chaos. This leads to obstacles for owners and staff that can get in the way of smoothly running the day-to-day. As a result, maintaining accurate, up-to-date books is oftentimes more difficult.
Many hospitality businesses might have bookkeeping low on the priority list because it doesn’t appear as vital to their day-to-day operations as managing employees and clients or customers. For example, if a waiter loses an invoice from a supplier, the operations of the restaurant won’t immediately come screeching to a halt. On the other hand, if nobody is available to receive a food delivery, the business might miss an entire day (or several) of business.
Although a missing receipt or invoice doesn’t have immediate consequences, these issues tend to indicate trends and lead to poor financial reporting overall. This could jeopardize the entire business over the long term.
Let’s go into detail about some of the bookkeeping challenges for businesses in the hospitality industry and how professional bookkeeping services can help overcome them.
When it comes to businesses in the hospitality industry, one common theme is the long hours of operation. The majority of hotels and motels are open 24 hours a day. Many restaurants open at lunchtime and then they don’t close until early morning.
This means that receipts, bills, invoices, and other source documents will be generated all throughout the day and night. As a result, there might not always be a dedicated employee available who is responsible for processing the documents at all hours.
The risk of poorly organized and lost documents is high if there is a lack of specific rules or processes in place for managing financial documents. This can make it a big challenge for hotels, restaurants, and other hospitality businesses to keep accurate and up-to-date books.
Many businesses in the hospitality industry are required to use paper bills from both customers and suppliers. This means they cannot digitize their documents at the creation point as easily as other industries. Having to use hard copies increases the risk of losing important documents and makes it more difficult for these businesses to keep their books organized.
Even though the hospitality industry is still paper-based in many ways, technology can still act as a disruptor. New point-of-sale (POS) innovations such as tablet ordering and payment have given many businesses a way to improve the customer experience. It is important to make sure that any new technology can be well-integrated with the current tech stack or it could add further complications and inefficiencies along the way.
How Professional Bookkeeping Services Can Help
Having accurate and up-to-date books is important for any business. It is crucial to know the state of accounts and exactly where money is being spent. Businesses in the hospitality industry face ongoing challenges that can have a negative impact on the state of their books. Outsourced bookkeeping is a great option for small and medium-sized businesses who operate with smaller teams dedicated to the day-to-day operations and don’t have an on-staff CPA
Professional bookkeepers provide benefits to small and medium-sized businesses that go far beyond bookkeeping. Bookkeepers who utilize cloud technology are well-positioned to help their clients improve their overall business efficiency as well as stay up-to-date with their finances with on-demand reporting and infinite cloud storage.
The reliability and standardized workflow provides hospitality businesses with a whole host of benefits. For example, a single system used to track and process source documents creates clear instructions for the hospitality staff. This increases the speed at which businesses can close their books, and decreases the risk of lost documents considerably.
Clear and simple instructions for what to do with receipts, bills, and other source documents will lead to increased efficiency for all employees who generate source documents. As the business owner, a standard, technology-driven workflow provides you with information about where your staff’s strengths are, and where areas of opportunity for improvement exist.
With quicker and more accurate monthly bookkeeping, you will be better prepared to provide timely business insights as well. In the hospitality industry, margins can be slim and finances can be rather tight. Having detailed insight into cash flow and the business’ overall financial health can add value, save time, and make the business more profitable overall. By taking this burden off of yourself, you are freed to focus on operations and overall business growth.
Take Bookkeeping Off Of Your Plate And Into the Cloud
Accurate and up-to-date bookkeeping is essential for any successful business, but it can also be complicated and time-consuming. At Lloyd & Hodge, we understand that your time is valuable. As a business owner, your time is best focused on the core of your business, not on the day-to-day bookkeeping tasks.
Contact us today to learn how Lloyd & Hodge can help you save time and money, and allow you and your staff to focus on what you do best – provide top-notch service.