Better Results for a Hospitality Group

Streamlining Bookkeeping Processes for a Hotel Chain

Background:

We received a call from a hotel chain operator who was struggling to keep up with their bookkeeping requirements. Their current bookkeeper did not have the necessary resources to continue delivering the work, which put the hotel’s operations at risk.

We decided to arrange a discovery meeting to understand their needs and determine the minimum cover required to pay staff and suppliers while we work through their bookkeeping pain points.

During the meeting, we went through the client’s bookkeeping and management reporting to identify what was working and what was not. We also took a step back to imagine what would be ‘awesome’.

What did we learn?

1. The paper handling process was outdated and needed improvement.
2. The collection of source documents was incomplete, which made the bookkeeping process more challenging.
3. The responsibility for bill approvals was unclear and needed to be streamlined.
4. There were issues with bill processing that resulted in duplicate and incorrect invoices entering the accounting system.
5. There were difficulties in checking purchase orders against invoices, which led to discrepancies.
6. There was a lack of control over opening new creditor accounts and new product items.
7. There was no real visibility for management across the group’s performance.
8. The managers needed a visual representation of each venue’s performance to assist with decision-making. They liked the idea of a rolling six-week average.
9. They needed a better solution for tracking Time-in-lieu and incorporating a full costing for payroll.
10. They required a systemized approach for dealing with inter-entity transactions and cost-sharing across the group, including HQ employees and staff working across multiple venues.
11. The management reports were distorted by different business activities such as inter-entity stock transfers.

How did we help?

Streamlining Processes:

We only work with programs that have an open API, which means they can share data in two directions. Our approach to streamlining the process involved:

1. Moving from physical to fully digital and cloud-based processing of bills.
2. Introducing a purchase order system with a departmentalized approval process and blocked new product and creditors from being created without management approval.
3. Setting up a group liaison officer to co-ordinate with and capture all source documents digitally from the venue personnel and act as the sole communicator with our dedicated staff person.

Wages:

Wage costs are a significant expense for pubs, and having reliable data encompassing the full cost of payroll is essential. Here’s how we helped achieve this:

1. Agreed with management on a fixed on-cost provision for super, workers’ compensation, and other wage costs for staff based on historical averages.
2. Systemized the reporting of Time-in-lieu and reporting to venue managers to assist in rostering.
3. Agreed on Head Office staff members and splitting their wage costs across multiple locations.
4. Reconciled rostering to the accounts wages budget.

The Final Touches:

Visibility:

We worked with management to understand what they wanted to see and came up with a live dashboard incorporating weekly results for:

1. Consolidated group
2. Each individual venue
3. Margins across the pubs’ individual business activities
4. KPI targets for each business activity
5. Revenue Mix
6. Rolling six-week average for each venue’s business activity
7. Consolidated and Individual EBIDA

By streamlining the bookkeeping processes and improving visibility, we helped the hotel chain operator make informed decisions that led to significant cost savings and an increase in efficiency.

Testimonial:

I couldn’t recommend the team at Fraser Scott more highly. We are a mid-sized hospitality company, which often presents a significant bookkeeping challenge.

The exceptional team at FS has been patient, diligent, and punctual with all of our requests.

They have constructed a BI interface for all of our business performance reporting as well as handling our day-to-day bookkeeping operations.

To be honest, I was a little sceptical of them being able to deliver on the promises made during scoping but FS has delivered in every way.

If you are in hospitality and in need of reporting, consulting and bookkeeping support, discuss what you need with FS. You’ll be really glad you did.

Thanks to John, Ahmad, Nicole, and the whole team.

Daniel Fortescue
Group General Manager