Budget Report (1)

To enhance the sales of food which is the main service of restaurants and to limit the extra cost of material and get more profit. ● Assess existing costs and resources and proactively identify areas for improvement The most excessive cost area is the cost of food and beverages as the cost increased more than increase of sales. ● Propose desired budget outcomes. Attached as per appendices B Part D 1. Optimized Marketing Spending: We recommend maintaining the determined marketing budget of $13,000 per month to achieve our target sales for food and beverages. Consistency in marketing expenditure is crucial to driving customer footfall. 2. Cost Reduction in Food and Beverage Procurement: To reduce food and beverage costs relative to sales, we propose negotiating discounts with suppliers based on increased purchase quantities. Exploring alternative suppliers with competitive pricing and high-quality products can also be advantageous. 3. Expense Control: We need to monitor and limit other expenses such as utilities and miscellaneous costs to bolster our profitability. Benefits and Disadvantages of Each Approach:  Optimized Marketing: Benefits include increased sales and brand visibility, but the downside is the potential for increased costs.  Cost Reduction: The primary benefit is cost savings, while the disadvantage may be the effort required to find new suppliers.  Expense Control: The benefit is improved profitability, but it may require strict monitoring and potential adjustments in operational processes. Impact on Customer Service Levels and Colleagues:  Optimized marketing can enhance customer engagement and service if executed effectively.  Cost reduction may not directly affect customer service but can positively impact colleague morale by contributing to the restaurant's financial health.  Expense control should not negatively affect customer service but can lead to more efficient operations, positively impacting colleagues. Importance of Monitoring Budgets: Monitoring budgets is crucial for several reasons:  Financial Discipline: It ensures adherence to financial plans and goals.  Proactive Decision-Making: Identifying budget variances early allows for corrective action.  Performance Evaluation: Monitoring helps evaluate the effectiveness of financial strategies.