How Much will Minimum Wage Hikes Affect Your Prices?

In my last post, I wrote about a study that predicts increases in the minimum wage will lead to significantly more restaurant closures.  Clearly, many restaurants and bars are unable (or failed) to raise their prices in response to increases in the minimum wage, resulting in their ultimate demise.

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Will Your Restaurant Survive The Minimum Wage Hike?

Premier Kathleen Wynn has announced that Ontario’s minimum wage will be increasing, substantially, over the next year and a bit. Based on studies done in other places, the jump in wages is likely to have a significant impact on small businesses, especially restaurants and bars.

You’re Probably Using the Wrong KPIs

Recently, I’ve been doing a lot of work implementing KPIs for restaurants and bars.  For those of you who may not know, KPIs are Key Performance Indicators.  Statistics, or metrics, about your business, that you can track to monitor your performance toward key objectives, such as profitability and growth.

Targeting Groupon Diners

If I had been the founder of Groupon when Google offered up $6 billion for it, the door wouldn’t have hit me on the back-side as I rushed to the bank to cash the cheque! While I think Groupon is an interesting concept, they are really greedy, and ultimately, it will be their downfall. Let me explain.

Groupon seeks out businesses that are willing to offer deep discounts for their goods and services. Usually, the discounts are around 50%. Groupon takes another 25% or so for publicizing the offer and collecting the funds from the bargain-hunters. That leaves the business with only 25% of what it would normally take in on a sale.

Groupon talks businesses into signing up by claiming that they may lose a bit on the first sale, but they will make it up on subsequent sales. Nonsense. Alternatively, if businesses have excess capacity, they can accommodate lower-paying customers, because they only have to cover the incremental (or marginal) cost of servicing the customer. This works for spas and other similar businesses. There aren’t too many businesses that have a marginal cost less than 25%.

What about restaurants? They are probably the most popular Groupon category, based on demand. Is it worth it for a restaurant to sign up for Groupon?

QuickBooks Accounting for Groupon

I’m almost finished with Groupon articles!  I’ve got two more, then, I think we’re done.  I’ve been writing these articles, because there is a lot of confusion surrounding the accounting for Groupon certificates and how to enter them in QuickBooks.  The resources for learning about these areas are poor (and often contradictory), but that’s nothing compared with the confusing, and often downright incorrect, information that has been written about the tax implications of using Groupon!  I hope these articles will help accountants, bookkeepers and restaurant owners set up their books and account for these transactions properly.

Today’s article explains how to account for a restaurant’s Groupon transactions in QuickBooks.  Previous articles have covered the POS system set up for Groupon transactions, accounting for Groupon transactions (in general), and the very important tax implications of using Groupon in a restaurant.