The Hospitality Business Toolkit

The Hospitality Business Toolkit

INTRODUCTION
Hospitality industry is the fastest growing industry and it consists of broad category of
fields with service industry. Some of these include cruise line, lodging, event planning,
restaurants, etc. This industry is a billion dollar industry and depends upon availability of leisure
time as well as disposable income. In the following report, a new restaurant is opened naming
Everland Wish. This is situated near gym and at prime location of UK. This provides advantage
for making good profits. There are four tasks – Task 1 includes information about financial
transaction, Task 2 includes HR life cycle. Task 3 tells about legal regulations and rules that are
followed within hospitality industry and Task 4 consists of
TASK 1
Introduction to the financial transactions of the hospitality business
When there is starting of any new business there are requirements of different
transactions. These include some factors like wages, electricity, resources, food items, raw
materials, rent and allowances, etc. The different financial transactions included in developing
running new restaurant are mentioned below -
Recording all expenditures
Incomings Outgoings
Wages Weekly food shopping
Gifts Clothes
Benefits Gifts
Allowances Household utility bills
drinks
Lunch purchases
Principles of managing and monitoring financial performance of the business
Financial monitoring of a business becomes important in order to assess the overall
performance (Chatzipetrou, Unterkalmsteiner, and Gorschek, 2019). If financial monitoring of
firm is done adequately it becomes easy to predict the profits and growth potential of business.

Financial monitoring also provides a base for future planning. The different principles of
managing and monitoring financial performance are mentioned below- Preparation of Important Financial Statements: There are some basic financial reports
which every organisation need to prepare which include balance sheet and the profit and
loss statement. They provide the owner with an idea on how is their organisation is
running. Preparation of debtors trial balance: It is important for a company to know that which
are the customers who owe them some amount. It helps keep a regular track on them also
bad debts can be avoided up to a limit if the firm reviews its trial balance of debtors every
month. Preparation of records of Inventory: Keeping a record of inventory helps the business to
track wastage during production. A record of material purchased and output produced
will give the indication of how much raw material is actually going to waste. It also helps
in calculating the input / output ratio and inventory turnover ratio. Preparation of Financial Ratios and Working Capital Statements: Businesses should
know how much are its asset when compared to its liabilities (Cabral, and Jabbour,
2019). Preparation of working capital statement helps the business to judge its capability
to pay-off any liabilities arising unexpectedly. Preparation of Cash Flow Statements: Cash flow statement helps the business to judge
how much are the liquid assets in form of cash available with business. This also helps to
justify between actual earnings and notional earnings of business. Analysing the Overheads: Apart from preparing financial statements a business also
needs to keep a check upon its expenses. Business needs to understand weather these
expenses are adding to the profits or bringing it down. Analysing the Marketing Expenses: A study on expenses made in marketing and the
actual revenues generated from it over the period of time is also necessary. This is
important because huge amount of funds are invested in marketing activities and no
business wants it to go in vain. Analysing the Human Resource: A review on how the funds allotted to human resource
department are utilised and what are its actual benefits for organisation is necessary.