1. Team Up for School Nutrition Success July 20-22, 2015
Financial Management
Team Up for School Nutrition Success
July 20-22, 2015

2. Objectives of Presentation
Review Financial Management Basics
Controlling Labor & Food Costs
Revenue
Co-creating Your Budget with Your Business Office
Sales & Participation
Using Your Budget as a Tool
Profit & Loss Statement
Meals Per Labor Hour
Summary
References

3. Basics If you don’t know your numbers, you don’t know your business.
“Cost control is one of the basic functions of management”.
Costs/revenue gives you your %’s
Revenue – Expense = profit or loss
Food, supply and labor costs usually represents around 90% of all costs and can be the most controllable.
Identify all revenue/expense centers
Accurate/timely accounting system
Accurate analysis is a must – allow for accruals

4. Controlling Labor & Food/Supply Costs
Review monthly
Take corrective action monthly
Count inventory monthly
Review all food/supply orders before they are sent
Cost out your meals
Price your ala carte correctly
Accurate job descriptions
Adjust labor based on sales, participation
Meals per Labor Hour as a guide

5. Reducing/Controlling Labor Costs
Training & motivation
Increase productivity
Use more self service
Job descriptions
Improve meal schedule
Pre-portion food
Simplify and standardize
Prepare work schedules – match jobs w/ employees
Use attrition to your advantage
Set attainable goals!

6. Revenue Identify profit centers with related expenses
Review your pricing annually for:
Meals
Ala Carte
Adult Meals
Catering
Reimbursement Rates
Don’t forget Inventory
Other revenue source ideas: Partnering with another school district, sports sacks, etc..

7. Co-Creating Your Budget w Your Business Office
Your business office will provide you with a budget that follows state regulations.
Once these budget lines have been established, expound on them.
Instead of meal revenue, create meal revenue for each school or profit center – do the same with reimbursements, catering, ala carte, etc.
Create expense lines for each school or profit center – food, labor, benefits, supply, etc.
Summarize each center separately

8. Business Office Budget

9. Sales & Participation
Daily, weekly, monthly, annually – the frequency of your analysis will result in more detailed, helpful and timely information.
Empower your managers and staff with timely information so they results of the efforts are consistently measured and reviewed.
Information gained: what meals/ala carte items drive up sales and participation; how similar schools compare with each other; year to year comparisons essential for your forecasting and “economic indicators”.

10. Use Your Budget as a Tool
Review your budget lines monthly – mistakes happen!
Learn to recognize trends.
Summarize fund balance (+ or-) monthly, don’t forget those accruals!
Figure daily budget accruals for revenue & expense: budget amount/# of school days = daily goal
Accrue as the year progresses
Makes sales/costs forecasting and budget writing much simpler
Do not let your budget be rolled!

11. Budget Accruals as a Tool
Food Service
thru Dec
89 days
Annual Budget
School days 166
thru Jan
102 days
MMS Food
$ ,385.87
$ ,082.99
$ ,000.00
$ ,168.67
$ ,392.11
$ ,111.69
WMS Food
$ ,319.74 $
$ ,000.00 $
$ ,801.43 $
OMS Food
$ ,170.47 $
$ ,000.00 $
$ ,062.93 $
MHS Food
$ ,954.87 $
$ ,000.00 $
$ ,521.42 $
LHS Food
$ ,366.90
$ ,307.49
$ ,000.00
$ ,313.25
$ ,609.53
$ ,319.70
HHS Food
$ ,359.95 $
$ ,700.00 $ $
GSRP Food
$ ,892.25 $
$ ,500.00 $
Total
$ ,450.05
$ ,308.43
$ ,200.00
$ ,416.87
$ ,387.42
$ ,297.92

12. Profit & Loss Statements
Individualize for each profit center
Include inventory
Review monthly with managers and staff
Summarize food/labor costs along with participation
I use only revenue and costs that my managers and staff have direct control of
Remember to accrue all expense and revenue
DO MONTHLY!

13. Profit & Loss/Costs Tool

14. Meals Per Labor Hour (MPLH)
Meal Equivalents/Labor Hours
Meal Equivalents: 1 lunch = 1 ME;
$3.00 ala carte = 1 ME;
2 breakfast = 1 ME
301 ME – MPLH
MPLH
Consider – type of food production, level of service, menu, preparation, equipment, staffing, scheduling, training, motivation, serving period schedule, size of facility, etc.
Use information for staffing, union stewards, goals, planning, reduction of labor, etc.

15. Meals per Labor Hour Meals Per Labor Hour HVS thru Jan 2015
thru Jan 2015
Ala Carte ME
Breakfast ME
Lunch ME
Meal EquTotal
Labor Hours
MPLH
Low
High
Muir Middle School
154
350
1580
2084
129.25
16.12 19 23
White Lake Middle
121 16
266
403
33.00
12.21 14
Oak Valley Middle
159
263
441
34.25
12.88
Lakeland High School
357 36
528
921
67.00
13.75
Milford High School
256 47
394
697
59.25
11.76 20
District
1047
468
3031
4546
322.75
14.09
to meet minimum
by ME
needed ME
2461
129.50
19.00
377
462
14.00 59
480
38.00
12.63 39
1273
79.50
16.01
352
948
16.00
251
6460
340.00
1914
Difference
-1914

16. Summary You are in control Knowledge is power
Communicate your information
Don’t let your business office assume anything
Develop your own tools and customize them to your district’s needs
Network with others

17. References www.restaurantowner.com
Cost Control for School Food Services, Dot Pannell Martin
Financial Management: A Course for School Nutrition Directors, NFSMI, 2005