Cafe Overheads

Overhead control is critical to your cafe's stability and profitability.

4 Tricks & Techniques

1. Establish a budget: When there is no clear budget, there is often no clear future. A well thought out cafe budget will help you limit your costs and plan for the future.
2. Determine your overheads: Make a detailed list of all overhead expenses, including but not limited to lease fees, electricity bills, insurance premiums, and equipment costs.
3. Track your overheads: There is little point in creating a budget and recording overheads unless you intend to track and monitor them on a regular basis; it is common for operating expenses to spiral out of control due to a lack of frequent monitoring.
4. Educate your team: Spend some time training your cafe staff on budgeting and cost awareness; this will allow them to be more accountable for overheads under their control and contribute to maintaining a healthy overhead margin, which means a sustainable bottom line. Share the responsibility and include your team; this will improve team culture, trust, and growth.

3 Home Truths

1. Profitability will decline: Excessive expense can reduce profitability and make it difficult to stay in business. Given how difficult it can be to make a profit from cafes, you really don't need the additional stress that not knowing your overheads can bring.
2. Extra Stress: High overheads can put a strain on your cash flow, making it harder to pay invoices and suppliers on time. This is a dangerous slope from which it is difficult to recover.
3. Reduced competitiveness: If your overheads are consistently high, you may be forced to make shortcuts, raise menu pricing, and cut labour. This frequently results in a decline in client experience, which is never good news.

How HospoSure Can Help

• Allows you to import and adjust over 50 common cafe overheads, saving time and stress.
• Gives you a comprehensive picture of your cafe's overhead allocation for everything you sell.
• Allows you to model and optimise your overheads in order to stay within your cafe's budget.