Finding Performance Gaps in the Three Financial Statements

Restaurant finance, or any commercial finance, can help inform a myriad of decisions. From restaurant performance measurement and management analysis to strategic planning and due diligence and feasibility studies, modeling the three financial statements and benchmarking and analyzing performance gaps hand in hand with operational key-performance indicators provides with insights to solve questions like:

Margins are being compressed for many restaurants and foodservice operators around the world. But the choice between driving revenue and improving margins does not have to be binary; both can be improved while catching a wider net of performance improvements.

We encourage our clients to think of restaurant business plans on both time frames: short-term wins are necessary to gain momentum and fund longer-term initiatives, but lasting organizations that transform the industry look past the next earnings call to three-, five-, and ten-year horizons — and beyond, and combining restaurant finance with operational goals and feasibility.

Insights Across the Income Statement

Restaurant Revenue

Restaurants’ top-line or gross income mostly consists of the sale of food and beverage. In franchised systems, a large portion of revenue could be derived from royalties and franchising fees. Restaurant finance reveals many metrics related to revenue that allow foodservice organizations to assess their top-line performance and set targets for their restaurant business plan.

Restaurant Finance Revenue

Restaurant Sales per Square Foot

Restaurant Franchising Royalty Fees

A deep understanding of the forces driving consumer behavior and competitive performance allows to identify where and why variances in performance exist and to obtain answers for how much and how long it would take to make the transformations to turn restaurant brands and operations from average to the top.

Restaurant Cost of Sales

Restaurant Labor Costs Effecting EBITDA

Restaurant Rent Cost in the Financial Statement

Other Expenses

Restaurant SG&A Selling General and Administrative Costs

Restaurant Profit Margin

Restaurant Profit Margins EBITDA

Restaurant Cash Flow Statement

Restaurant CAPEX

Knowing how and where best to place CAPEX dollars to ensure the dominance of your brand and secure territories (and market share) requires solid plans around strategic capital allocations. Every dollar in your CAPEX arsenal is like a soldier on your competitive battlefronts.

Restaurant Financial Ratios

Restaurant Basic Earnings Power EBIT to Assets

Restaurants Earnings Per Share US

Restaurant Finance Debt Ratio

Restaurants Financing Debt to EBITDA

Restaurant Ratios EBITDA to Interest

Restaurant Financing Interest Rates

Restaurant Financing Current Ratio

Restaurant EV:Sales Valuation Ratio

Restaurant Valuations EV-to-EBITDA

Relevant Insights to Restaurant Finance

ABOUT AARON ALLEN & ASSOCIATES

Aaron Allen & Associates works alongside senior executives of the world’s leading foodservice and hospitality companies to help them solve their most complex challenges and achieve their most ambitious aims, specializing in brand strategy, turnarounds, commercial due diligence and value enhancement for leading hospitality companies and private equity firms.

Our clients span six continents and 100+ countries, collectively posting more than $200b in revenue. Across 2,000+ engagements, we’ve worked in nearly every geography, category, cuisine, segment, operating model, ownership type, and phase of the business life cycle.