Improve the management of your hospitality business
"In cooking, as in everything, nothing is lost and nothing is created, or better said, I affirm for the present case that in cooking not a particle of food should be lost. Everything can be used, and from an economic point of view, leftovers constitute one of the most important aspects of culinary economy," wrote Ángel Muro in the publication "El Imparcial" in October 1891, which was later included in his book "El Practicón" published in 1894.
Proper resource management has always been and is an essential aspect in the operation of a kitchen and in the management of a hospitality business. This requires us to reflect on the objectives and daily management of our company, although it is not always easy to define them, so we must ask ourselves: What should our objectives be as entrepreneurs or hospitality business consultants in the company?
At Consulting Slow&Low, we believe that the objective should be to create a solid, serious, and responsible company, with strong structures, a high commitment to quality, defined culture and values, and above all, a capable and professional human team. All these aspects require defining clear objectives and strict procedures that allow us to control, analyze, and evolve in the internal management of the company, to maintain its continuity and improve its competitive capacity and results.
However, when the results are not as expected, for many managers and consultants of hospitality businesses, one of the first decisions and actions is to reduce the quality of raw materials or reduce the workforce. Solutions that may seem appropriate in the short term because they immediately improve economic results, but are wrong in the medium and long term because they decrease the company's competitive capacity. So, what decisions should be made when the results are negative? And in times of positive results? How do we anticipate these negative situations?
The creation of control tools allows us to understand the current economic performance of the company, a forecast of future results, and the necessary information so that we can anticipate decision-making. For this, it is necessary to prepare budgets in all areas of the business. In a newly opened hospitality business, the budgets are hypotheses for projecting future results, while in an operating business, we have a history of results that help us in their preparation.
Budget control helps us monitor and comply with the variables that make up the planned budget, which will allow us to identify which results of our fixed and variable costs require actions and corrective measures. The information obtained from budget control allows us to transfer it to the key performance indicators, KPI (key performance indicator), used in interpreting results, such as gross margin, net margin, break-even point, cash flow, and other efficiency and productivity indicators that we have established, which will allow us to have a real picture of the objectives achieved, the profitability, and financial health of the company, as well as the aspects we need to improve and the areas where we need to make decisions.
Therefore, prudence and reinvestment in times of positive results are essential. Likewise, control, monitoring, and anticipation in the forecasting and achievement of established results are essential actions in the daily management of the company.
