Budget Interview

I interviewed Wendy who is in charge of the budget at a local fast food restaurant. This restaurant is a fast food chain. I prepared the following questions and have listed her response next to each question.

1. How often do you review your budget? Monthly basis, weekly basis,
yearly basis? and who all is involved in the budget review?

The budget at this company is reviewed bimonthly. The budget is complex, because it involves food product, wages, building utilities, etc... Food orders are made every week and wages are paid bimonthly. Because Wendy is also part-owner in this company, she reviews the budget sometimes on a daily basis as sales are evaluated. The people involved in the budget review is Wendy and her husband, who is also part owner, and the store manager.

2. If you are over budget, what is cut first?

Obviously, with the fast food industry, food product is what is sold. So food orders can not be cut first. The first thing to get cut is "labor". First to go, is all overtime. Strict schedules are created to avoid having to pay out any overtime to employees.

3. How do you determine how much is alloted to employee pay, product, etc?

Because this company is part of a franchise agreement, much of the budget is set up standardized by the company. There is wiggle room depending on sales and the need of the store. Collaboration between partners and the store manager are used to help create the budget.

4. What is the consistent "problem" area of your budget? What
consistently is causing your business to go over budget?

This store just opened up about two months ago. The consistent problem this early on has been overtime. A lot of work was needed to get this restaurant open. Many of the employees were required to work overtime in order to accomplish a strong opening. In the future, the plan is to cut overtime so as not to go over budget.

5. How do you communicate changes in the budget to your employees and staff?

The store manager is in charge of communicating changes in the budget to employees. The only effect the employees will feel is the cut in hours. The store manager is in charge of writing schedules and contacting employees to discuss their individual schedule and hours.

This budget interview was a very good experience for me. I was able to sit down with an owner of a restaurant and learn from a non-healthcare perspective the importance of a budget. It is amazing to me how all companies depend on a budget. Without a budget, the company would ultimately fail. There needs to be a plan and specific numbers for the company to be successful at making money. Even though this restaurant is relatively new, I believe that they have a good idea of how to budget their company.