Is the Cloud Key to Better Accounting?
Hospitality Technology hosted the first meeting of the 2019 Restaurant Accounting Innovation Council on November 27, 2018. Sponsored by Restaurant 365, the council is comprised of restaurant finance leaders with a charter to improve efficiencies and effectiveness of restaurant accounting systems for other operators.
When examining IT budget splits, council members aligned with about 50% of overall IT budgets going to the enterprise. HT’s 2018 Restaurant Technology Study found that 45% of tech budgets go to enterprise software. Council members say that roughly 15% of that is allocated for accounting. Several members agree that cloud-based models help in terms of lessening cost.
“We have a cloud-based subscription model and the cost is not that high of a percentage of our overall budget,” Mark Quandt, CFO, Wood Ranch BBQ & Grill, says.
Here we examine some of the other benefits and pitfalls of cloud-based or hybrid solutions. Cloud or hybrid solutions can help to lessen in-house concerns as operators can outsource specific areas such as payroll, which many members named as an appealing aspect for their organizations.
Benefits of cloud include that you do not have to install the software on multiple physical devices or VPN to server, which offers more flexibility.
“This is the way the world is going,” Steven Song, CFO, Luke’s Lobster, acknowledges. He admits frustration when upgrades roll out and everyone on the software is impacted whether they wanted an upgrade or not.
Woodranch’s hybrid solution enables the company to store its data in the cloud. For Quandt the convenience comes in that they no longer have to maintain servers or focus on hardware as much. Quandt notes downsides, such as pulling data off the cloud can take longer than it did when it was held on-property.
“Things just take a little bit longer than when we had it right here,” Quandt says. “It’s got to go through our VPN, our firewalls — all the technology to protect us slows things down, so certain processes just aren’t as fast as they used to be.”
Having a central source of data is a key concern for council members. Bruce Nelson, CFO, Nova Hospitality Group, recalls that prior to implementing Restaurant 365, the company had data flowing from multiple different sources and any anomalies that occurred from the store level to the restaurant required investigation.
“We had to figure out what part of these steps failed,” Nelson explains. “The upside of this is that you have one bucket from where you pull your financials, payroll and inventory information. The downside is if you make mistakes it also affects all those things, so it requires us to be more attuned to accuracy.”
Having data in one ecosystem eliminates the need to navigate through multiple platforms, which takes time and delays impact decision making.
“If you can reduce the time you need to spend gathering information in order to make decisions in real-time, you’re going to improve operations and financial results,” Brandon Keith, CFO, World Famous Fare, states. “It’s about finding efficiencies like reducing manual entry at the store-level or in your office. Rather than manually entering invoices or trying to move data back and forth — it comes down to getting information into one bucket.”
Scott Gillman, Chairman, Mascott Corporation
Melissa Haman, Finance, Broadway Restaurant Group
Steven Song, CFO, Luke’s Lobster
Mark Quandt, CFO, Wood Ranch BBQ & Grill
Michael Lubitz, CFO, Wolfgang Puck Fine Dining Worldwide
Christi Hing, CFO, Kona Grill Inc.
Brandon Keith, CFO, World Famous Fare
Bill Valentas, Vice President of Finance, Freddy’s Frozen Custard & Steakburgers
Bruce Nelson, CFO, Nova Hospitality Group
John Moody, Co-Founder, Restaurant 365
Abigail Lorden, Vice President/Group Brand Director, Hospitality Technology magazine
Dorothy Creamer, Editor, Hospitality Technology magazine