Nory’s BLOG / Nory Live P&L: the power to drive restaurant growth with live...

Nory Live P&L: the power to drive restaurant growth with live data

Table of Contents

Drive your restaurant's performance with Nory

Discover how leading restaurants are increasing operational performance and profitability with our AI-powered restaurant management system

Explore their success stories 👀
reduce food waste in restaurants,

Nory News

Performance Insights & Business Intelligence

Nory Live P&L: the power to drive restaurant growth with live data

By Daisy O'Malley - June 19, 2024

We talk a lot about the power of real-time data because we know how valuable it is. It gives hospitality businesses the confidence and ability to make quick, smart, and strategic decisions to improve their bottom line. 

But how does this translate to profit and loss (P&L) statements? 

Well, pretty much in the same way! 

A live P&L statement gives restaurants valuable insight into their current financial health. 

And what does this mean?

It means you can identify the best ways to cut costs and increase profits. 

In this article, we’re delving a little deeper into the power of live P&L reports, including why they’re essential for restaurant success. But first, let’s clarify the basics: what is a profit and loss statement? 

What is a P&L statement?

A profit and loss (P&L) statement summarises your revenue, costs, and expenses during a certain period (usually monthly). It provides a snapshot of your financial performance, showing whether you made a profit or incurred a loss. 

What’s included in a P&L statement? 

Here are the typical elements of a P&L statement: 

  • Total revenue
  • Operating expenses 
  • Cost of goods sold (COGs) 
  • Gross profit (the amount you make after the cost of making and selling your food)
  • Gross profit margin
  • Taxes 
  • Depreciation
  • Interest
  • Insurance 
  • Income type (dine-in/takeaway)
  • Accounting or legal expenses 
  • Advertising and marketing costs

On the statement itself, your total revenue usually sits on the top line. All of your running costs and operating expenses are then subtracted from the total revenue, leaving your net income at the bottom

All of this information provides you with a solid foundation to improve your restaurant operation and help your business grow. 

Restaurant operator reviewing a live P&L statement with Nory

Now, why is a P&L statement so important for restaurants? 

Let’s take a look: 

  • Identify ways to cut costs, increase profit margins, and make adjustments to improve profitability
  • Compare P&L statements from different periods to identify trends
  • Assess the impact of any business decisions, like menu changes or deals and discounts 

Hot tip 🔥 Analyse your P&L statement alongside your balance sheet and cash flow statement to get an even deeper understanding of your financial performance. 

What is a live P&L statement? 

Traditional P&L statements are prepared periodically (such as monthly, quarterly, or annually). But live P&L statements? 

They’re captured in real-time

They display your revenue and net income as it’s actually happening, and costs are updated on a daily basis. You don’t have to wait until the end of the month to see it. They continuously update to reflect the latest financial data in real-time.

Why is a live P&L report crucial for restaurant success? 

So, why is a live P&L statement more effective than a standard monthly one? 

Let’s find out. 

Real-time financial visibility

With a live P&L report, you have instant access to real-time financial data. This means you can make quick and informed decisions to improve your bottom line as quickly as possible. 

Someone holding a tablet to review their restaurant P&L

This could involve reducing your supplier costs, minimising your marketing spending, or making tweaks to other operating expenses that reduce your overall costs.  

Enhancing operational efficiency

Live P&L data provides data that helps you optimise different parts of your restaurant operations. For example, you can analyse costs relating to inventory management or labour scheduling and make changes to improve your spending.

Accurate forecasting and planning

Having a live P&L aids in accurate forecasting and strategic planning for restaurants.

Think about it — instead of having to wait until the end of each month, you can access financial insights at any time. As a result, you have the information you need to create accurate forecasts as and when you need them. 

Limitations of a P&L without real-time insights 

As we all know, things can change pretty quickly in hospitality. Customer demand fluctuates, costs go up and down, new regulations come into place, and so on. 

Without real-time P&L reports, restaurants are missing opportunities to respond to these changes and make quick decisions about their bottom line. 

Let’s say that you’re reviewing a monthly P&L report and you notice that profits were higher at the beginning of the month than they were towards the end. 

If you had known this in real-time, you could have made some changes to spending to increase your margins even further. For example, buying more ingredients to meet customer demand at the beginning of the month, and less towards the end. 

Sure, you can make these changes going forward — but you’ve already missed the chance to increase your profit margins from last month. 

A chef holding a freshly toasted sandwich

Reviewing traditional P&Ls doesn’t always accurately reflect your current financial position. Why? Because you’re always looking back at the previous month. Changes in revenue, expenses, and other market conditions can happen after the reporting period. They’re not captured in the report, but they’re happening in real-time. 

This lack of real-time insights can skew your perception of your financial health. It can impact your decision-making and your bottom line (and not for the better), which is why real-time reporting is so important. 

How Nory’s live P&L works

That’s right, folks — Nory has a live P&L reporting function 🎉 Say goodbye to the days of waiting for P&L reports! 

The new P&L feature instantly displays your sales, COGs, labour costs, and profitability all in one place. Simply click on the flash P&L report, and you’ll see all this data on a single screen.

The report breaks down this data line-by-line, so you can see your operating profit for different venues in real-time. 

That’s right — you don’t have to wait for bookkeepers to crunch the numbers to access this valuable data! You can see it instantly, meaning that you can make fast and informed decisions about how to boost profits. 

In a single glance, you can see which locations are under or over-performing. Plus, you can filter the view to focus specifically on locations that are the most profitable, or venues that are underperforming. 

Filtering the report also helps you pinpoint areas where certain locations are below targets. You can then click into each section to see a detailed breakdown of the underlying data. This is where you can really see why they’re underperforming, and make informed decisions on how to improve performance. 

But wait – there’s more! Nory P&L features that are worth shouting about 

Take a look at some of the other features of Nory’s new flash P&L report:

  • Real-time data capture. We capture your sales, performance, and costs in real-time. It’s automatically pulled into the report so you can visualise your financial health in a single glance. 
  • Line-by-line breakdown. Our report mirrors a real P&L income statement, making it easy for you to navigate the report and analyse the information. 
  • Integration with existing systems. Our software integrates with existing ePOS systems like Toast and Vita Moja. What does this mean for you? It means that you can centralise all of your sales and spending information in one place to get the most accurate and up-to-date P&L statements. 
  • Simple user interface. We know that restaurant operators have a million and one things on their plate (pun intended 😏). That’s why our P&L feature has a simple user interface — so that it’s easy to navigate and understand your financial health as quickly and efficiently as possible.
  • Intuitive display: Live P&L view provides filters above the cards which can be used to focus on locations that are over or under-performing under each of the metrics.
Nory's restaurant P&L report

Use Nory’s live P&L to track your bottom line 

Tracking your P&L is essential for any restaurant. It shows how you’re performing financially, helping you track your revenue, income, and profits across your entire restaurant. If your profits aren’t looking great, you can use the statement to find where it’s best to make adjustments. 

And with live P&L reporting? You have access to all this valuable financial data as it’s actually happening. 

Interested in getting a better understand how Nory could help you?

Give your teams the confidence to make informed decisions and track their performance in real-time.

Watch our product tour now.

FAQs about restaurant P&L

What is the average profit and loss for a restaurant?

It’s hard to say, as it varies so much from restaurant to restaurant. Location, cuisine, footfall, menu pricing, and operational efficiency all influence the profit and loss of restaurants. 

The National Restaurant Association places the average restaurant profit margin at 5%. However, there are lots of different sources that claim anywhere between 0-15% is average, with full-service restaurants on the lower end of the spectrum and quick-service restaurants at the higher end. 

How do you calculate P&L?

Calculate your profit and loss by subtracting your total expenses from your overall revenue over a specific period. Here’s the formula: 

Revenue – Expenses = Net income 

Revenue includes all your income sources (which will mostly be food and drink sales), while expenses cover things like food and beverage costs, labour, rent payments, utilities, and other operating expenses. The net income indicates whether you were profitable or not during that time frame. 

Live P&L vs actual P&L: What’s the difference? 

A flash P&L (sometimes known as an interim P&L or estimated P&L) provides a quick snapshot of your financial performance. 

Unlike a full P&L statement, it tends to focus on a few key elements of your financial performance instead of giving you the full breakdown. For example, it might touch upon your total revenue, outgoing costs, and net income without providing a full breakdown. 

It also takes place at the beginning of a certain financial period, giving you an estimate of how performance will look by the end. Because of this, it’s not always entirely accurate — although it can be handy for predicting future performance and getting an idea of your current financial state.