What do you do when one of your employee's salary must be garnished? Sheila from the Mize Houser team shares the important information you need to know.

We encourage you to contact a KRHA Allied partner if you have specific questions regarding this topic.

Mize Restaurant Group 913-451-1882 www.mizehouser.com

Every restaurant owner is familiar with the mantra “cash is king”.  Having a healthy cash flow can make the difference between staying afloat or facing a potential financial drowning.  A downturned economy, lost customers, difficulty finding investors or a natural disaster are all events that can bring a healthy cash flow to a mere dribble.

What do you do if you find yourself in a cash crunch?

Think “triage”.  Prioritize the usage of available cash.  Put your employees first by giving payroll top priority, as well as tax withholdings and employee benefits.  These types of costs are priority one when cash gets tight. Then, take a look at what upcoming payments and bills you have for the next 90 days (sometimes less).  Are there any commitments that could be negotiated to be paid at a later date or partial payment? Slash any expenses as much as you can. Also keep an eye open to red flags that could indicate potential fraud resulting in loss of cash.

Speed up your billing cycle.  Think about invoicing more frequently from once a month to twice a month.  Long term this may give you more cash flow. Is your business cyclical? Can you adjust your billing cycle to support the seasonality of your restaurant? Is the delay in billing due to internal procedures that developed over time, or due to customer demands?

Manage your receivables. Don’t consider your accounts as revenues until your customers pay you. Think about providing incentives for customers who pay upfront or require customers to put a deposit down for your services or products (if it makes sense).  Be sure to let employees in charge of collections understand the goals that you have for collecting old receivables and what “incentives” they can give to customers who are willing to pay early.

Manage overhead costs.  If you are having a cash shortage, it is often because there has been some disruption in the normal flow of revenues your restaurant receives.  If this is the case, be honest with yourself about how much overhead your business can handle.  Make tough decisions about cutting overhead quick . . . don’t let bloated overhead continue to sink your ship for months on end.

Consider selling non-essential assets. The short term benefit of selling an asset is quick cash. For example, selling an piece of equipment to generate short term cash may not be worth it in the long run when one day you’ll have to buy back the asset and potentially lose money in the process. But if you hold non-essential assets, the quick cash could be invaluable.

Manage your credit cards.  Make sure you understand outstanding balances and credit limits for cash advances versus purchases.  Consider charging expenses to cards with available merchandise credit, but no available cash advance credit.  The idea is to maximize your available cash advances when you need them.

Take a preemptive strike. Your CPA can be your life preserver. Having regular cash flow statements and reviewing them with your accountant can help you identify potential problem areas down the road. Often businesses that are having cash flow issues hesitate to call their CPA because they want to control fees; however this is on key advisor who is most likely to be able to keep you alive to fight another day.

Talk to your banker. Your banker wants to see your business do well and grow. Talk to your banker to find out if there are any short term financial solutions to help you stay afloat.

Don’t panic.  Getting a full picture of your current situation will help ease your anxiety. And having a plan to get your business back on track will allow you to focus on your customer and future. 

Article By Bret Curtis, JD, CPA, LLM, Mize Houser & Company P.A.

We encourage you to contact a KRHA Allied partner if you have specific questions regarding this topic.

	Mize Houser & Company P.A. Bret Curtis, CPA, JD, LLLM Shareholder bcurtis@mizehouser.com 913-451-1882 www.mizehouser.com
	Profit Builders Michelle Becker michelle@yourprofitbuilders.com 316-729-7900 www.yourprofitbuilders.com

Spend less time and money on payroll and the details that are involved with payroll processing.

We encourage you to contact a KRHA Allied partner if you have specific questions regarding this topic.

Mize Houswer & Company P.A. Bret Curtis, CPA, JD, LLLM Shareholder bcurtis@mizehouser.com 913-451-1882 www.mizehouser.com

Your restaurant is full, your turning tables, your employees seem happy. Business appears to be going good, but how do you know if you are making any money?

We encourage you to contact a KRHA Allied partner if you have specific questions regarding this topic.

Mize Houswer & Company P.A.   Bret Curtis, CPA, JD, LLLM Shareholder bcurtis@mizehouser.com 913-451-1882 www.mizehouser.com

Learn more about fraud and how to protect yourself and your establishment.

 We encourage you to contact a KRHA Allied partner if you have specific questions regarding this topic. 

Mize Houser & Company P.A. Bret Curtis, CPA, JD, LLM Shareholder bcurtis@mizehouser.com 913.451.1882 www.mizehouser.com

Use tax is a complementary tax to sales tax. Most states have sales tax, but there are some that don't. But those that do, normally expect businesses that conduct business in their state to keep track of items that they purchase from out of state. So if they do that, they should look at those invoices to see if there was sales tax charged for their location, and if not then there is almost always a consumer use tax or compensating use tax law in that state where you have to self-report that tax and pay it. 

 
Learn more about use tax and how to protect yourself.

We encourage you to contact a KRHA Allied partner if you have specific questions regarding this topic. 

Mize Houser & Company P.A. Bret Curtis, CPA, JD, LLM Shareholder bcurtis@mizehouser.com 913.451.1882 www.mizehouser.com