The Board: February 2023

Hi there!

So much going on! Back-to-back Super Bowl and Valentine’s Day means y’all are probably as busy as you’ve been in the past few years. We’ll share some numbers next month for both.

On a more serious note, we’ve been digging into what we call the “post-COVID era” daily sales data and seeing positive news across our U.S. client base. Drop me a note if you would like more details.

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- Tracy & the MarginEdge team

MONTHLY METRICS

January National Restaurant Sales & Price Movers

Overall sales increased 19 percent from January 2022, peaking mid-month around 35 percent. By segment, Fast Casual ended up on top with 20 percent sales growth, but Full Service was not far behind, ending at 14 percent above last year (hello, double digits). 

Lettuce prices continued to drop last month, meaning all those New Year’s resolution-motivated salads probably had some better margins. 

Dig into the full report

ITEM TO WATCH

Eggs

Recent egg prices have struck a nerve with consumers and operators alike. It’s even come to cross-border smuggling. Home cooks are clamoring for Depression-era cake recipes, and Bon Appetit is offering alt recipes for those wishing to reduce egg use. 

Based on our historical data, prices year-over-year (as of February 1) have skyrocketed from $2.73/dozen to $4.17/dozen. Avian flu has ravaged the entire industry over the last few months. Operators we have spoken to have either absorbed the extra cost or raised prices to maintain per-plate profitability. Let us know if you’re making menu changes or are seeking alternatives based on these rising prices.

February has come in sunny side up though - our data shows egg prices have dropped 13% compared to last month (as of February 14).

South Block, Multiple Locations

ASK [me] ANYTHING

A lot of my vendors are talking about EDI. Can you explain what it is?

1. EDI stands for Electronic Data Interchange. It’s been around since the 1960s, and for you history buffs, was developed initially for the transportation industry to allow computer systems to communicate with each other. 

   Today, EDI allows thousands of companies to exchange information (such as orders and invoices) with each other. With technology advances across the entire restaurant industry, the benefits become more evident.

   • Accuracy: there’s no manual data entry, so errors are minimized. 
   • Efficiency: ordering with EDI is quick, no lengthy phone calls to the supplier or playing phone tag with your rep.
   • Speed: we have said farewell to the fax machine and the beloved clipboard, information is instantly transmitted with EDI.

   If you are using MarginEdge, you can still upload invoices with any handwritten adjustments and we will account for the noted credits. More information can be found MarginEdge EDI and Reconciliation Tool.  

Ask [me] anything!
Really. Each month we’ll take a look at the questions we get and answer one here. Have a question about our product, accounting or restaurant operations in general? Email me or message us on our social media channels.

Open Road, Multiple Locations

THE ECONOMY

Order Inflation Up 

While you were prepping for a super-busy Valentine’s Day, the inflation numbers were released. 

Yesterday's Consumer Price Index Data from the federal government’s Bureau of Labor Statistics (BLS) shows overall annual inflation at 6.4 percent, up from the previous month, but still a far cry from summer’s 9.1 percent high. Food prices both at home and away from home increased from the previous month by 0.4 and 0.6 percent, respectively. On an annual basis, food away from home increased 8.2 percent versus 11.3 percent for food at home. 

Both retailers and restaurateurs are actively looking at ways to keep consumers spending, and it seems to be working. A recent survey showed Valentine’s Day dinner spending levels weren't going to be impacted compared to 2022.

'TIS THE SEASON

Taxes

I know, I know, the February newsletter should be about beautiful dinners for two or chocolate lava cakes or perhaps champagne, amirite? But since this newsletter will hit your inbox on the 15th, I kinda had to go a different route.

The IRS tax deadline is a mere 63 days away (it’s April 18 this year, hooray!), and even though we heard “Don’t Do Your Taxes” throughout a certain football game’s commercials, we don’t really recommend you forgo them for your business. I’ve spent a lot of time over the last six months with accountants and bookkeepers learning the nuances of restaurant accounting compared to a retail store or other small business. 

As your trusted financial professionals dive deep into their busy season (and are likely short staffed), we’ve compiled some recommended reading to help them help you.

• Small Business Tax Prep Checklist 
• 2023 Guide to Filing Restaurant Taxes
• Who Gets a 1099 
• What to Do if You’re Behind on Sales Tax
• Restaurant Tip Reporting

However, since it is right around Valentine’s Day, I can play financial cupid for you –  if you’re in need of accounting or bookkeeping matchmaking services, please reach out and I can make an introduction.