Weekly: the controllables

Food, beverage and labour move too fast for monthly reporting. Weekly, an operator should receive:

  • Prime cost by site — food plus beverage plus fully loaded labour, as a percentage of net sales.
  • Theoretical versus actual food cost variance, calculated from the POS product mix against costed recipes.
  • Labour percentage and sales per labour hour by daypart, against the schedule.
  • A flash P&L — approximate, but timely.

This requires a weekly inventory count, at minimum on high-value and high-movement items. Operators resist this and it is the single highest-return discipline in restaurant finance.

Monthly: outlet P&Ls

Each location gets a full profit and loss statement down to site EBITDA, before group overhead, with head office allocated separately and visibly on an agreed basis.

This is what makes a failing site visible. A group P&L showing 8 percent net margin can comfortably contain one site at 18 percent and another at negative 6. The loss is real, it is funded by the profitable sites, and it typically continues for a year or more purely because nobody built the site-level view.

Alongside it: channel contribution (dine-in, takeaway, each delivery platform separately, after commission and packaging), menu contribution analysis, budget variance, and rent-to-sales against the lease schedule.

Aggregator accounting, done correctly

This is the most commonly mishandled area in UAE restaurant accounting.

Delivery platforms remit net of commission. The temptation — and the common practice — is to record the net receipt as revenue. That is wrong in three ways: it understates revenue, it hides the commission cost entirely, and it creates a VAT position that is difficult to substantiate because the value of the supply is the gross amount, not the net remittance.

The correct treatment records gross sales as revenue and commission as a cost of sale, with the platform's settlement report reconciled to the POS and to the bank each period. Only then can you calculate contribution by channel, which is the analysis that tells you whether delivery is building the business or quietly consuming it.

Worth checking: take one month, calculate delivery revenue gross, subtract commission, packaging, platform-funded promotions and the incremental labour to service it. Compare the contribution percentage to dine-in. Many UAE operators find the gap much larger than they assumed.

Inventory and central kitchens

Inventory should be counted weekly on high-value items and fully monthly, valued consistently, and reconciled to the ledger with variance investigated rather than absorbed.

Where a central kitchen or commissary supplies multiple outlets, the accounting becomes more involved: production yield and waste have to be tracked, work in progress valued, transfers priced on a consistent and documented basis, and the kitchen's own overhead allocated across the outlets it serves. If the central kitchen sits in a separate legal entity, the transfer basis is also a related-party matter for Corporate Tax purposes and needs to be defensible as arm's length.