This a crystal ball, but a well-reasoned and conservative guess what to expect for the coming 12 As we will discuss, you should not consider The bases for your assumptions are likely to change.
Meaning each week you will extend the horizon out another week. We will refer to it throughout this article.Īs you can see, it is a 12-week projection, and should be viewed as a moving target, Please review the model cash flow spreadsheet (above).
Heavier reliance on delivery and takeout sales, and occupancy limitations during reopening, The large national chains - has a revolving credit line or ready investors.įor most independent operators, if they are fortunate, CARES Act funds are a source ofĮmergency cash as they adjust their business models to the so-called "new normal", including It is unlikely your independent restaurant business - unlike The large national chains are doing everything to obtain and conserveĬash. Sales cut off abruptly, leaving nearly every restaurant business gasping for air.įew restaurant businesses, other than quick-service concepts set up for drive through service,Īre spared from this crisis. This problem is amplified in the pandemic, with restaurant That is, our sales are often seasonal, while certain expenses, That said, many restaurants have a disadvantage in cash-flow management compared to We drive sales and keep a watchful eye on expenses. Profit-and-loss statement (P&L) management. So, during periods of steady business, restaurant cash flow management is essentially With credit cards, we do not have to wait long for sales to show up in our accounts.
And even though most of our customers pay us The restaurant business is a cash business.
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