How to build a restaurant cash-flow forecast

Start with receipts, not the POS total

A restaurant’s sales report and bank deposits answer different questions. Card processors and delivery platforms may settle on different dates and deduct fees or adjustments. A cash-flow forecast should show when funds are expected to reach the bank.

Choose a consistent approach: either forecast gross receipts with fees shown separately, or forecast net settlements and avoid subtracting the same fees again. Track cash sales and other receipts separately where needed to reconcile the schedule.

Put each commitment on its payment date

• Food and beverage purchases: use expected deliveries and supplier payment terms.
• Payroll: include pay dates and related employer costs or remittances on their actual schedule.
• Occupancy: rent, utilities and other location commitments.
• Franchise costs: royalties and advertising contributions according to the agreement, if applicable.
• Other cash movements: equipment, repairs, debt payments, taxes and owner distributions where applicable.

Food, beverage and labor are often discussed together as prime costs. The National Restaurant Association’s operating-cost research identifies them as major cost categories. A prime-cost ratio helps assess operations, but it does not replace a cash schedule.

A weekly example

If $8,000 of settlements arrives the following week, the closing balance falls to $18,000. Sales can be unchanged while available cash changes substantially. This is an invented example, not a benchmark or a client result.

Keep location detail and a combined view

For multiple restaurants, prepare a view by location and a combined business view. Shared payroll, central purchasing and intercompany transfers need consistent treatment. Eliminate internal transfers in the consolidated view so moving cash between locations does not appear as new outside cash.

Separate a new location’s build-out and opening costs from its ongoing operations. Test the effect of a delayed opening and a slower sales ramp while rent, staffing or other commitments continue.

Review the forecast with operations

Use a rolling 13-week cash-flow forecast to compare expected and actual settlements, purchasing and payroll. Explain variances before adding the next week. A change in guest counts, average check or scheduling may affect both the operating plan and cash timing.

Compare food and labor measures with your own history and plan using consistent definitions. A universal percentage can miss differences in service model, menu, geography and staffing. Decide which operational changes are feasible before relying on savings in the forecast.

Meagan brings 12 years of restaurant franchising experience, including both franchisor and franchisee perspectives. Peak’s restaurant and franchise CFO services support operating analysis and growth decisions; project advisory includes cash-flow and new-location modeling.