Master Restaurant Profitability with Kasey Anton of Spark Business Consulting

Are you ready to transform your restaurant's financial health? In this episode of Restaurant Leaders Unplugged, we sit down with Kasey Anton, founder of Spark Business Consulting and author of Profit First for Restaurants. Kasey shares her journey from restaurateur to financial consultant, revealing the strategies behind her Profit First system that have helped countless restaurants thrive.

Learn how to:
✔️ Build a business that runs without you
✔️ Manage food, labor, and operating costs effectively
✔️ Turn financial struggles into sustainable profit
✔️ Uncover hidden expenses and reinvest in growth

From practical tips to inspiring success stories, this episode is packed with actionable insights for restaurateurs who want to thrive, not just survive.

Connect with Kasey Anton:
🌟 Book: Profit First for Restaurants
🌟 Instagram: @kaseyanton
🌟 Website: https://sparkbusinessconsulting.com/

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Transcript

(0:00 - 0:42)

I knew I was building it to be a business that could stand on its own two feet, like be a big girl and do its own thing so that I could go and make choices to do other things, which has allowed me to open the other businesses, allowed me to write the book, allows me to be a professor because of that. But even if somebody doesn't have other ambitions to do other things, every business should be always be built to be sold one, even if you never plan on selling it, you build it to sell it and you should always build it to run without you. Welcome to the Restaurant Leaders Unplugged podcast, where real talks with restaurant leaders take center stage, discover the challenges and victories that define success in the culinary world, dive into essential strategies for marketing to operations and gain insights that will transform your approach to your restaurant business.

(0:43 - 0:51)

Don't just keep up, lead the way. Join me, your host, Sebastian Stahl, on this journey to excellence. Welcome to the Restaurant Leaders Unplugged podcast.

(0:51 - 1:08)

We're really excited today to welcome Casey Anton, founder of Spark Business Consulting and author of Profit First for Restaurants. With over 20 years in the industry, Casey has helped countless restaurants and owners transform their business by mastering their numbers and building sustainable success. Casey, it's really great to have you here.

(1:08 - 1:11)

Welcome to the show. Why, thank you so much. Pleasure to be here.

(1:12 - 1:24)

So Casey, let's start from the beginning. I know you have quite a background. So how did you end up in the hospitality business? Yeah, I mean, that's all I ever wanted to do.

(1:24 - 1:39)

And it's funny, it's unique just because nobody in my family, and I have pretty extended family, was in the hospitality business. And I mean, nobody. But for some reason, from a very young age, four, five or six years old, I was just infatuated with the restaurants in general, always wanted to go out to them.

(1:39 - 1:48)

We did not a lot. But when we did, it would be like my birthday would be a time we'd go out. It was just, I mean, oh, that was just like winning the lottery for a six year old.

(1:48 - 1:54)

And so it was in my blood. I just loved it, loved it, loved it in that way. My parents did not love that.

(1:54 - 1:59)

I loved it. Right. So they wanted me to go to college to get like a more general degree.

(1:59 - 2:06)

Didn't want me to go to hospitality, food service, beverage management, too narrow, they said. And, you know, they were paying for part of it. So I'm like, OK.

(2:07 - 2:14)

So I went to URI and I got a degree in communications and marketing. But the minute I graduated, I went and got a job at the Chard House. I don't know if you're familiar.

(2:14 - 2:19)

So that is, it's still around. They're just smaller now. And that is a chain of high end steakhouses.

(2:19 - 2:27)

And at the time. So this was in like 1996. At the time, they had the leading management training program.

(2:27 - 2:34)

It was called CHAMP for Chard House Administrative Management Program. And you had to apply. You had to pay a fee to get into this.

(2:34 - 2:41)

You know, they had to accept you. It was a big deal to be accepted, to become one of their managers. I mean, I don't think you see that anymore.

(2:41 - 2:48)

But at the time, it was a big deal. So I got in, I was accepted. And then they move you to any one of their Chard Houses.

(2:48 - 3:02)

And I was hoping I'd travel because they had a bunch in Hawaii, California, Vail, like I wanted to go, but they put me in Boston and I was already at URI. So I'm like, that wasn't too far. But I landed in Boston and learned everything there is to know about restaurants, corporate restaurants, really.

(3:03 - 3:12)

And then once I had a day off, which was pretty rare, I started touring the city. And found all these amazing little boutique restaurants. So then I said, Oh my God, there's a whole new world.

(3:12 - 3:24)

I had no idea these little five star restaurants existed. So then I'd start visiting and I ended up transferring and being a general manager for those and eventually found partners, opened up a couple of our own. The rest is history.

(3:24 - 3:35)

I just loved it. I still do love it. I just didn't stay in it because I got married, had my first child and my partners and I were kind of all going in different paths in our life.

(3:35 - 3:40)

And it just was a new chapter. So I ended up doing the next best thing. Something that I got really good at.

(3:41 - 3:46)

Totally relate to you. Kind of the same thing happened to me. Got out of it because marriage, kids, and it's just staying on with that lifestyle.

(3:47 - 3:52)

It's just so. Yeah. So how did you make the transition? So that's restaurant operations and everything.

(3:53 - 4:04)

And then you started really getting some more interest into finance and all of these things as you release the restaurant. So how did you get interested in that? And you moved over to found Spark Consulting. Yeah.

(4:04 - 4:15)

So when I sold the restaurants, it was like August of 2006, I sold our last restaurant and then I thought I'd be a stay at home mom for about four seconds. Did not last. That was the hardest thing I'd ever done.

(4:15 - 4:21)

I couldn't do it. I'll start. Well, now what case? Because all I had known were restaurants for the previous almost 20 years.

(4:21 - 4:44)

It's all I had been doing and I knew I couldn't go back into it industry the way I had been in it. So I took an inventory of my skillset and really what I got really good at that would be transferable to maybe another type of job or industry was the number. So I had to get really, really good at following the dollar, which is really like the bookkeeping, accounting and analyzing of the financials.

(4:44 - 4:54)

I had to do that in order to keep my restaurant alive long enough so that we were able to sell it rather than just close it. So I got really, really, really good at understanding financial. So I thought, well, there's my skillset.

(4:54 - 5:04)

Maybe I can bring this to somebody else. So I called up some chefs that were opening restaurants that I knew at the time and said, Hey, I'm thinking of doing some bookkeeping accounting. Would you? And they're like, oh yeah, yeah, yeah.

(5:04 - 5:08)

So I got a couple of little restaurants and then from there and that was easy. I could do that in my sleep. Right.

(5:09 - 5:20)

And then from there, everyone had like a girlfriend that was an interior designer who sucked at money. Hey, do you think you can help her? She's terrible. And then a general contractor who never paid his bills on time or couldn't collect money.

(5:20 - 5:32)

And then I'm like, all right, well, you know, I've never been in those industries, but I'll talk to them. And then what I found out is I met with all these small business owners across many, many industries. That the same math works anywhere you go.

(5:32 - 5:40)

It's like two plus two equals four or two minus two equals zero, more likely is anywhere I went. And so I'm like, oh, okay. And so that's how Spark was born.

(5:40 - 6:03)

It's just the skillset that I derived out of necessity for my restaurant ended up translating to exactly what small businesses need across small. So I'd say that we grew really fast at Spark. Probably a hundred clients in the first four or five years, which was large for a bookkeeping company, right? So yeah, I think three or four full-time employees, about a hundred clients.

(6:04 - 6:19)

So I had this front row seat, right? I had this bird's eye view of what was going on in all these different businesses. So I learned really quickly, like what were some really good decisions and good things to do and what more, what not to do. What I saw owners doing that were just tanking their businesses.

(6:20 - 6:37)

So that's kind of where the consulting came from is because I was able to see how people were operating all different manners and put it together and be like, okay, now I can really help these businesses because I've seen both sides of it and I've felt it too. I've lived it and then came profit first or kind of toward the end of that. Right.

(6:37 - 6:53)

So, cause you're talking about everything, your bird's eye view of looking at everything that the restaurant owners were doing. What are some of these challenges? I mean, we're speaking to an audience here of restaurant owners. So what are the challenges that you constantly see that you saw back then that you still see now that restaurant owners face when it comes to managing their finances? Yeah.

(6:53 - 7:24)

I mean, I will say that all comes down to really the kind of the same basic problem, which is they either don't have, or don't understand, don't know their business model. That's number one is understanding your business model, meaning whatever it is you're selling, how much money that costs you to sell it and what's left over at the end, right? Pretty much basically your P and L, right? Like the revenue coming in your direct costs, any overhead and where's the profit. Understanding that.

(7:24 - 7:43)

And there's a story in my book, profit first for restaurants. I mean, there's six different case studies, but the one that I say most people write to me about is the sad story is the burger shack out in Indiana that did what so many restaurant owners do, which is this gentleman, one of the nicest people I've ever met. Hey, there was a space over.

(7:43 - 7:46)

Oh, great. I like restaurants. I'm going to get this little space.

(7:46 - 7:49)

Oh, burgers in a college town. Great. I'll sell burgers.

(7:49 - 7:55)

Oh, what are college students willing to pay for a burger? Oh, six bucks. Okay. I'll charge six bucks.

(7:55 - 7:58)

Here we go. Like, that's it. Like, that's all they're thinking.

(7:58 - 8:07)

Like, okay. So by the time this client came to us, they were about three years in, in a lot of debt. And once we drilled through the numbers and figured it out, it was costing him.

(8:07 - 8:24)

He has 60% food cost alone, let alone any other cost. And he had no idea, right? He had no idea that every time he sold a burger, he was losing money. And that money, that loss is backfilled by debt, which is why he had so much debt at the same time.

(8:24 - 8:43)

And with restaurants and a lot of businesses that take sales every day and credit card sales, there are so many ways to get money loaned to you because they attach it to those deposits and they feel like a gift from heaven. If you're a restaurant owner, not realizing that you just didn't fix the problem. Now you're just, you're basically digging yourself a hole because you're only losing money.

(8:43 - 9:01)

So, and I'd say that is kind of the crux of the issue that I see across the board in any business, but especially in the restaurant business is they don't understand exactly what their food beverage cost is. Their prime costs or their labor costs is understand it and plan for it. And then you're operating expensive on top of that.

(9:01 - 9:09)

And then lastly is to understand that you have to have profit. That profit is not a dirty word. It's not greed.

(9:09 - 9:18)

It's not a bragging point or ego stroke. Profit is an absolute necessity just for your business to survive. You have to have it.

(9:18 - 9:25)

It covers so many things that a business needs. And I would say that at that time, I had almost 200 clients. Nobody understood profit.

(9:26 - 9:37)

Not one of my clients understood profit in the way that it's a choice that you make. Profit is something that you should take. It's a choice and it's money in a bank account that you can point to that's nicknamed labeled profit.

(9:37 - 9:45)

Oh, there is my profit. Most business owners think it's a number on the bottom of a PNL of an income statement, like black and high. Oh, good for me.

(9:46 - 9:54)

And if it's red and negative, you're like, oh, I better do. That's not what it is. So I think getting people to understand or business understand that profit is actually deliberate.

(9:55 - 10:01)

It is a choice. It's not some happy accident and planning for it within your business model will change everything. Fantastic.

(10:02 - 10:12)

So tell me about your book. Let's get into a little bit of that because we're talking about all these things. What is the system that you teach in this book? What is it about? Our audience can understand a little bit more.

(10:13 - 10:25)

Yeah. So it is a derivative of the original Profit First book, which came out just 10 years ago now, which is a cash management system for your business, which might sound boring. But let me just explain it because it's not boring.

(10:25 - 10:31)

It's actually simple and kind of genius. To be honest, I wish I came up with the whole thing. I just came up with the one for restaurants.

(10:32 - 10:43)

But really, what it does is it leverages your typical small business owners habit that they already have. And Mike wrote the book, Mike Michalowicz. And he's absolutely right.

(10:43 - 11:17)

And small business owners, especially with me getting to know so many of them, they practice what we call bank balance accounting. Every single one of my clients did that, which is you log into your bank account, you look at the balance in the account, and you make questionable decisions, right? You make decisions based off of the balance in your operating account, in your checking account, whatever. And that's going to kill your business because what you don't realize when you log in and you look at that amount and you start making decisions that within that amount is your profit, is your correct owner's pay, is the taxes going to be liable if you're operating a profitable business or all those things.

(11:18 - 11:25)

But you're not thinking of that at the time. When you're logging in on a Monday or Tuesday morning as a restaurant owner, you're thinking, oh, there's $10,000 in there. Great.

(11:25 - 11:30)

I'm going to pay my food and beverage vendors. I'm going to make payroll, maybe rents due. And you spend the money.

(11:30 - 11:37)

And that count goes down to zero or very low. And you're like, oh, all right. I better go make some more sales to put more money in there so I can pay more bills.

(11:38 - 11:41)

And then you do that. And then you log in next week. And you look at the amount.

(11:41 - 11:43)

Maybe there's $12,000. Great. I'm going to pay this.

(11:43 - 11:45)

I'm going to pay this. I'm going to buy that new oven. I'm going to do whatever.

(11:46 - 12:00)

And then you spend all the money. And then you're like, ah, where'd the money go? It's like a dog chasing its tail, right? This is what all business owners are doing is they're spending their profit, their owners pay their taxes, and then wondering why they're not profitable. And it's almost kind of crazy when you think about it.

(12:01 - 12:09)

So with Profit First, especially with Profit First for restaurants, we're going to leverage that because I couldn't break anybody of that bank balance accounting habit. There's no way. I tried.

(12:09 - 12:13)

I tried for years. It didn't work. Hey, don't look at your bank account balance.

(12:13 - 12:24)

Look at my P&L and then make decisions. I'm just not going to do that. So instead, for restaurants, I have you open up several bank accounts and nickname them, meaning you're giving every bank account a job.

(12:24 - 12:30)

So here's how it works. We have an income account. That's where all of your sales, all your revenue gets deposited.

(12:30 - 12:35)

Just think of a big pile of money. Pretend like everybody paid you in cash. You're just piling it up into that account.

(12:35 - 12:55)

Then you're going to have your prime cost account. So you'll have a food and beverage account, a checking account, and then a payroll checking account. So what you do is from that income account, if you say or believe that you have a 30% food and beverage cost, then you're going to transfer 30% of what you see in that big income account to the food and beverage account.

(12:55 - 13:10)

And then it's the same for payroll. If you believe you have a 30%, 31, 32, whatever it is, whatever percent it is for labor, you're going to make that transfer. So now the income account goes down and you've populated your food and beverage account and your labor account.

(13:10 - 13:20)

And now you have living, breathing budgets. Now you know what you have available to pay your food and beverage and to pay your payroll for that period. You have it because the money's there.

(13:21 - 13:38)

And then you make the other transfers to profit, owners pay, owners tax, and op X. That's operating expenses. That's one of the bigger amounts, but that's what you have available to make those, what I say, questionable decisions about, oh, I'm going to paint the bathrooms. I'm going to buy the oven or the Lowboy or whatever it is.

(13:38 - 13:53)

You're able to make that based off of what's left in the op X, not that big, huge income account where it's just kind of bloated. And you think that you're rolling the dough cause you're not. We gave every dollar a job by sending it to the account that it's used for.

(13:53 - 14:15)

And when you do that, you just built a business model and you just leveraged bank balance accounting. Cause now when you log in and then you make those transfers, now you can make all the great decisions you want. And the other thing I love about it is if you do all those allocations, like I said, and then you go to sit down and pay your food and beverage vendors and you pay them, you realize there's not enough money in that account to pay them.

(14:15 - 14:43)

Well, then guess what? You're not running a 30% food and beverage costs. So here's the thing. Wouldn't you rather know that immediately and make some adjustments, menu prices, portion sizes, whatever it is, wouldn't you rather know that immediately rather than wait to the month's close, the bookkeeper does the books, you make a meeting with your accountant and you sit down, you review and then go, Oh my God, I'm running a 32% which could be what? 1, 2, 3, 6 months later, if ever.

(14:44 - 14:50)

Now, you know immediately and the same with the payroll. Same with payroll. If you don't have enough to cover payroll, guess what? You're not running that your percentage payroll.

(14:50 - 14:59)

And now you can make those choices to fix it. That's fantastic. So Casey, why do you think restaurant owners avoid that? Listen, I experienced that when I opened my first restaurant and I was doing the same thing.

(14:59 - 15:13)

It's like whatever they are on the account, that's what we have to pay. And I wasn't doing this. And why do you think is so prevalent that there's like a avoidance of wanting to look at the reality? That is very true.

(15:13 - 15:21)

There is a huge avoidance. I would say though, I've been doing this for a while now. So I would say it's one, it's not even an avoidance.

(15:21 - 15:26)

It's that they didn't know that a better way existed. So that's number one. And here's the thing.

(15:26 - 15:56)

I'd say of the 60 plus restaurant clients that I have right now, just restaurants, about half, maybe a little more than half are doing the profit first, as I mentioned, and are literally killing it, are doing great. And even during COVID, all of those restaurants thrived while others weren't doing that because they had it all dialed in. My other half or a little less than half are not for whatever reason, as much as they know about profit first, as much as I've spoken to them ad nauseum about it, they, like you just mentioned, just, oh, that sounds good.

(15:56 - 16:02)

Maybe next year, maybe next time. Maybe that's what I get all the time. And I just want to bang my head against the brick wall.

(16:03 - 16:16)

I don't understand why they do it. I think there is simply just a fear that it's going to put a mirror up to their face and they're going to realize that maybe their model's broken. Maybe there isn't enough money.

(16:16 - 16:23)

Maybe they, and then I think they'll take that very personally. Maybe they're a failure and none of that is true. But I have a feeling that that's where that comes from.

(16:23 - 16:47)

Yeah, I agree with you. In my case, I did a little bit of introspection to see what would happen. It's just fear, looking at things as they are, because when you see that fire, like I'm good and it just makes you feel better, right? And then when you really go into the details, like where you really are standing, it can be scary because you're going to make some decisions that you were probably avoiding making as well, like firing people, having to do all these different things that you just don't want to deal with.

(16:47 - 16:51)

Hundred percent. Yes, that's exactly what happens. Yeah.

(16:51 - 17:02)

It's interesting that you just said that because I think it brought me back to, I've had the same conversation more than once, but recently I had a conversation with someone, their payroll was 45% or something ridiculous. And so I said, all right, let's dive in. Let's go through everybody.

(17:02 - 17:08)

Let's see who's there and what's happening. And then they just didn't want to let anybody go. But it was all emotional.

(17:08 - 17:15)

It was just like, well, you know, if we get busy or I'll really need this person. Your business is not emotional. Your business doesn't care.

(17:15 - 17:21)

Here's what's available. Make this work or don't, but know the consequence. That's so important.

(17:21 - 17:31)

And anyways, I can relate to that for sure. We've made some changes since then, but that's what we see as well. So Casey, you talk about in your book about dialing in on expenses to find hidden money.

(17:32 - 17:43)

Can you share some practical examples of how restaurant owners can uncover and eliminate unnecessary costs? Sure can. This is one of my favorite exercises. It's so, so simple, but it reaps such huge benefits.

(17:43 - 18:09)

So in the book, I talk about if you have, which you should have as a business, a profit and loss detailed report, right? So that is the listing of all of the transactions that make up, let's say your dues and subscriptions, your office supplies, your direct offering, things like that. So you actually get to see the charges, the checks, whatever behind those numbers. So if you can print up that report and any software should have that, I would do it for about three months because doing it longer than that would be a lot of pages.

(18:09 - 18:13)

And I like to do this by hand. You could do it on a screen. Certainly I like to print it off.

(18:13 - 18:24)

So I'll export it to Excel, print it off, grab a highlighter. And then I start just going through every single line item. And I think like, okay, do I really need this? Can I pause this for a while? Can I delete this? Whatever it is.

(18:25 - 18:41)

So here's what I'm finding when I have clients finally willing to go look in the mirror and go do this is a lot of Amazon charges that probably have nothing to do with the restaurant because they're all in the same account. And it's just easier to use the credit card for the restaurant credit card than just to do your personal credit card. I get it.

(18:41 - 18:45)

And this is not in any way, some type of ethical thing. I don't care what you do. But here's the thing.

(18:45 - 18:56)

Your business can only support so much. And if the money's not there, if your business can't support you running your personal life through Amazon, you're like basically beating the redheaded stuff out. You're hurting your business.

(18:56 - 19:09)

So that's one. I think a lot of things like people, if they're having a cash flow problem and they want to save their business, don't put expenses on it that don't belong to it. And so Amazon's a first place because it's an easy place to hide it in office supplies.

(19:09 - 19:17)

Another one I'll see, dues and subscriptions or software expense. This is not too much with the restaurant industry. This is more other industries.

(19:17 - 19:31)

But sometimes people have that new shiny object syndrome kind of when it comes to software. So they'll sign up for Monday, click up, all these different things. And they either forget or think that someday they're going to go use them and they just pay for these over and over again.

(19:31 - 19:50)

And those can add up and they do really quickly. Another one that I love, well, there's certainly their insurance one is probably the lowest hanging fruit and the biggest one that you can get. Because what I find most people don't understand is that the insurance companies change their appetite for what type of insurance they want to carry every year.

(19:50 - 20:00)

So you can't always use the same broker. Even if your broker says, oh, I rep a bunch of companies, they might not rep the insurance companies that want to do restaurants. Right.

(20:00 - 20:15)

So if one big company like the Hartford, for example, huge insurance company for restaurants years ago when I was in it, they gave me a cheap quote. I latched onto it the next year. It almost doubled because probably what happened is the Hartford had a ton of claims by restaurants.

(20:15 - 20:21)

They're like, restaurants suck. We don't want them anymore. So now they're going to raise their fees because they don't want you anymore.

(20:21 - 20:26)

But there's safety or whatever down the street. Another insurance company says, oh, we'd love to get into the restaurant game. Here's your quote.

(20:27 - 20:40)

And it could be half the price. So insurance is change all of the time. And that should always be vetted out because I've seen companies save tens of thousands of dollars per year just by shopping out the insurance and getting a better rate.

(20:40 - 20:44)

And I could go on and on. You know, glassware is another big one. Theft on things.

(20:44 - 20:47)

Yeah. There's so much you can find in there. That is fantastic.

(20:47 - 20:52)

You just gave me a few ideas also for my business. Oh! We are also big on software. So that thing, that happens.

(20:52 - 20:56)

It's like shiny object. We get it for a little bit and then we stop using it. And it's like, you forget to cancel.

(20:56 - 20:58)

Exactly. It just stays on. And it happens with restaurants as well.

(20:58 - 21:27)

So Casey, we're facing very particular challenges right now in the industry, right? We're talking about labor costs, food costs, all high. And everybody's complaining about thinning margins, which is a reality. If there's anything that you can suggest or how do you go about working with restaurant owners now to improve their margins using your system, considering that we're facing these realities that we can't change, right? So before you could have a more substantial profit margin.

(21:27 - 21:43)

Now they're down to 5%, you know, full service restaurants. So what's your take on that? So I have a lot of thoughts on that. And all of them come right back to what I had said in the beginning of our talk today, which was your business model.

(21:43 - 21:59)

So here's what I would suggest that people do. When we have a client that's going to implement profit first in their business, in their restaurant, let's say where we start, meaning how we come up with the percentages that they need to allocate is we look at the last year or two years of their business. We actually figure out where every dollar went.

(21:59 - 22:41)

And that's how we know where to start with our allocation percentages, what their food cost really was, no matter what they say, we figure out what it is because we follow the money, labor, et cetera. So getting back to your question, I would challenge the restaurant who maybe was doing well, maybe had more robust profit margin, maybe 8%, 10% before and now we're down to, you know, slim one to three. I would go back to those years where they were running 8% to 10% and figure out how they were doing that, right? How they were doing that, what the percentages were, because if it's just percentages based, if they're saying, well, then we were doing 30% food costs and now I'm doing 35, okay, well, your business may not be able to survive at a 35% food cost.

(22:42 - 22:46)

That's just a fact. This is an example, of course. That's just a fact, right? It's not going to survive.

(22:46 - 22:56)

So how do you lower your food costs? You raise prices or you cut expense, you know, you cut the cost. I'm assuming hopefully you've already tried those two things. So that's the same, the same with the labor.

(22:56 - 23:08)

Labor should just be a budget number and then you build to that number and that's it. And then you make it work, right? You look for efficiencies and you make it work because your business can only afford what it can afford. It's not, well, I really need it.

(23:08 - 23:13)

I really need all these people. I need 14 chefs. Okay, you need it.

(23:13 - 23:21)

Your business can only afford this, very black and white. And if you're going to fight on this, then you're going to end up in a hole with a lot of debt. That's just simple math.

(23:21 - 23:37)

That's not an opinion. That's a fact. But for other restaurants, there are ways to possibly like get that food cost down and liquor cost down in terms of, you know, more on the higher end or mid to higher end restaurants, doing contests for side dishes, desserts.

(23:37 - 24:02)

I mean, really helping people, your staff anyway, sell a value of really look for a way to add those side dishes, which maybe could be like a 10, 20% food cost on those. I have ideas in the book about that, but those could really change everything. Just being creative, thinking outside the box, knowing that the issue is you need to either bring in more money or you need to lower your costs.

(24:02 - 24:06)

Those are the only two ways you can do it. So figure out what works for you and what works best for your restaurant. For sure.

(24:07 - 24:13)

I mean, people getting very aggressive with this. It's just very granular. They're going into each menu item and dissecting the cost of it.

(24:13 - 24:22)

So then just kind of taking away everything that doesn't really work. And it's not at those numbers where you need to be at. And you just go with that because there's just no other option.

(24:23 - 24:32)

So you have to evaluate every single menu item and just streamline with all that stuff. Or we're getting creative with concepts, coming up with concepts that reverse engineering the whole thing. Yes.

(24:33 - 24:50)

This is a great opportunity to get creative, to have those creative juices flowing again and really reinvent, recreate yourself or even just the guest experience. Maybe you can be yourself, but change the guest experience. I mean, one thing with the holidays coming up, I don't know when this will air, but right now, it's mid-November.

(24:50 - 25:05)

So we have the holidays coming up. And I don't understand why, and I go out to eat quite a bit, why I'm not being offered Christmas cookies to go or something fun to go in a little bag, because I may not want to commit to sitting down and having to sit there and eat a dessert. Like I get that.

(25:05 - 25:13)

I'm always like on the move. But if you offer me something, three cookies in a bag for six bucks, I'm going to be like, that's the greatest thing ever. And it probably cost you 50 cents.

(25:13 - 25:26)

I think a lot of people are going to do that. So just being creative, looking for those opportunities, I think will be huge and fulfilling. Well, another thing that we're seeing as well is people betting more on private events because these are controlled costs.

(25:26 - 25:36)

But you can control your menu that you're selling. You control the staff that you're using for an event and it's high ticket. So anyways, a lot of restaurants with spaces, big spaces, that's where they're heading.

(25:37 - 25:45)

So Kasey, when it comes to marketing, and let's just switch gears here a little bit. Yeah. Something that we see is that it's an afterthought.

(25:46 - 25:59)

And there's no budget for that, even though every single business requires a budget for marketing. And I know you have a little bit of also a marketing background. What are your thoughts on that? What do you think restaurant owners, like you're saying, I guess they're going to that.

(25:59 - 26:14)

They see the big pile that is, I can allocate this much and there's no actual budget. So what are your thoughts on that? Well, my first thought when you just asked me that is why does it have to cost money? When I think of marketing, I don't think of an added cost. I personally don't.

(26:15 - 26:26)

It might be helpful to have some money. Just for me, when I think of marketing, I start with the internal marketing. I grow my businesses and I have three businesses now and I grow them from the inside out.

(26:26 - 26:49)

So internal marketing for me right now is really investing in my staff, right? Getting them on board with our culture, our values, what we do, why we serve, why we love who we serve, how we can help them more. Somebody had said, I tell my staff all the time, and I quoted this from somebody else, which was, I'm like, make me go bankrupt by your generosity. I just want you to go out and serve.

(26:50 - 27:08)

And that doesn't necessarily have to cost money. That's me just spending one-on-one time, group time with my staff. So in a restaurant, it could be your daily huddle, your pre-shift, where you're really just investing in connecting with and getting everyone on board with providing the most amazing customer experience.

(27:09 - 27:31)

That's number one, just the internal part of that, because that will absolutely grow tentacles and translate out into more butts in seats, which is what we're getting at, right? So that's number one. That's the internal, and I always start there. Another thing I would do that also costs almost nothing, which is the illustrious comment card, which I get so much mixed feedback on that.

(27:31 - 27:54)

I think it's hilarious because the comment card for the listener is really, I mean, if you can do it, you could probably do it on a screen, but I don't even know what that looks like. So for me, it's an actual, something I print in-house on like a heavy stock paper where you can collect the customer's name, address, email, whatever you want from the customer. Whenever I had those filled out, I knew this in the restaurant, it was like one of those completed was gold.

(27:54 - 28:02)

It was worth hundreds, if not thousands of dollars to me. And I knew that just by looking at it. And my staff used to think I was nuts, like, whatever, Casey, it's somebody's address.

(28:02 - 28:11)

No, no, I can get this person to come back in now. I can do this no matter what happened. And all it is, it could be just a phone call that costs nothing.

(28:11 - 28:27)

It could be me writing them a letter that costs me the stamp in the paper that it's on. And yeah, there's just so much you can do. And a lot of it could just be through a text and a phone call these days, email as well, personalized in a way that you know, they want to receive it and you get them to come back in.

(28:27 - 28:34)

So again, that's almost no cost marketing. And it's just like getting across that you truly care about them. You were grateful they came in.

(28:34 - 28:53)

You want them to come back. Hey, look what we have now. And so, yeah, the sky's the limit when it comes to gathering this information from your customers and then using that information to create an amazing experience for them that they'll want to come back in, that they will have this red carpet treatment and that they're going to tell all of their friends and keep coming back.

(28:53 - 28:56)

Right. That's great insight, Casey. Thank you for sharing that.

(28:56 - 29:08)

So, Casey, moving now to a little bit talking about your consulting business. Would you share a success story where implementing the Profit First system led to a significant turnaround for a restaurant client? Oh my God. Yeah.

(29:09 - 29:13)

Oh, which one should I start with? I have a couple. I'm trying to think of the one. Okay.

(29:13 - 29:24)

So a turnaround story I'll probably use. Yeah, I will use the one in New York. So this was a large Irish bar in New York.

(29:24 - 29:35)

And when they came to us, they had a huge payroll. I think there was like eight people that got together to open this bar. So I think two of the eight actually maybe worked in the bar.

(29:36 - 29:42)

I use the word lightly. The other ones didn't. They were just investors, but they were all on payroll for some decent size salaries.

(29:43 - 29:48)

And the food cost also was out of whack and things like that. So they were hemorrhaging money. They just weren't busy at all.

(29:48 - 29:59)

The regular Profit First years ago came to us saying, hey, can you fix us? So when we dug in there, that's what we discovered, first of all, and got them on board with, which was their payroll was like 48% or something. This can't happen. We went through it.

(30:08 - 30:23)

We realized that every single person that ever ate there basically was on payroll, is what it seemed like. And we had to just explain to them, like your business can't afford, either you keep these people on payroll, and then you fire every other employee, including your kitchen front of the house staff, then you guys can run it. They all had full-time jobs, it's not gonna happen.

(30:23 - 30:33)

Or it's one or the other, the business doesn't have it. So we got them on board with that. And so instead, but they're like, well, why would we put money in if we're not gonna get something back? No, I hear you, that's fine.

(30:33 - 30:49)

But the way you pay back any debt, any investor, the only way you can do that is through profit. So we just said, listen, instead you're going to get paid back. You're still gonna be paid by this company as long as it's profitable, because then we know that this restaurant can actually pay you back.

(30:49 - 31:04)

If it's not profitable, it can't. So instead they would get profit distributions. And then with the profit for a system, it designs a way, like I had said, where we're putting profit aside and in a bank account named profit, we build that up over a quarter.

(31:04 - 31:13)

And at the end of the quarter, we take that money out and then we divvy it up among the investors. And then that's what the business can afford to pay you back. And it was very little at first.

(31:13 - 31:44)

So I'm sure they weren't thrilled, but now the business could run because the money was actually pumping through the business, right? So their cashflow was going through because their payroll came back down and the investors still got paid out little by slow, but now I think they're paid off because we did it the right way through profit is how you pay back debt. So that's probably one. And they really went from like being about a half a million, over half a million dollars in debt, I would say at the time, not knowing what was going on, just taking paychecks and thinking that, oh, we had a busy Saturday, this should be okay, but not really understanding that it wasn't.

(31:44 - 32:06)

But when we have a system for the money, they understood it, it's visual, they can see it. When we turned it around, so I'd say at the time, three years into profit first, this one, because it's in the book, I think that their debt was cut in half, if not almost all gone, and they were at like a 20% profit margin. Because when you implement the system and you have less money for things, you automatically look to be efficient.

(32:06 - 32:16)

You just look to be creative and look for efficiencies. And when you automatically do that because you have to, your business will like, it'll just explode because of it. It just becomes a better business.

(32:16 - 32:27)

So that's one. The other one I'd like to mention is a caterer who came to us right before we even opened, which I love. Now we can't always get to people before they actually open, and that's okay.

(32:27 - 32:53)

But when we can, it's beautiful because this caterer started us right from day one, doing profit first. And I have to say, he went from $0 on day one, the first year, over 2 million, second year, about four and a half million, and I'd say the profit margin's about 25% after he pays himself. Like this place is, he is printing money, and it's because of profit.

(32:53 - 33:05)

He'd be the first one to say that too. I've always recommended him out first. He would say it because it's just giving every dollar a job and using it how it's supposed to be used rather than that big account, and just like, here, everybody have some, changes the game.

(33:05 - 33:20)

Those are some great stories. Thank you for sharing that, Casey. And so let's switch gears to talk about leadership because for you to be able to implement all these systems, of course, you can do it in the owner and all that stuff, but leadership will tie in into every decision and everything that you implement in a restaurant or any business.

(33:20 - 33:53)

So I know you get a team, you call them sparkles, which is a nice thing. So I think that speaks to your leadership styles. How do you foster a positive and productive work environment? And what advice would you have for restaurant owners aiming to build a cohesive team? Well, for me, it's just being extremely authentic and making sure that my place of business is a safe place and that everybody can bring their comments, questions, feedback, concerns, ideas, and they will absolutely be heard.

(33:54 - 34:12)

And a lot of them will be better, not all of them, but a lot of them will be like, oh, this is a great idea, let's do it. And I actually think that probably ties back to something that I have learned about myself. I'm surprised that not everybody thinks this way, is that it never ever occurred to me that I was supposed to be the smartest one in the room.

(34:12 - 34:24)

Like that never even occurred, that never occurred to me. I'm like, I'm thinking I have a skillset, maybe one or two, and I was gonna find people way smarter than me to do the other stuff that I either didn't wanna do or I just wasn't good at. And that's how I built my business.

(34:24 - 34:37)

And it's probably why it's one of the biggest bookkeeping accounting firms in the US is just because I kept hiring people to do the things that I knew I wasn't good at who were smarter than me. That's what I've always done. And I would say that would be true in a lot of areas when it comes to restaurants and other businesses.

(34:37 - 34:56)

And I find that odd because in all of the conferences that I had been going to these last few years, especially ones that were for like coaches, consultants, things, most people don't think that way. And I couldn't understand it, but it's just, I think it's like an insecurity or something. And I'm certainly, I can be very insecure about things, there's no doubt about that.

(34:57 - 35:10)

But this was just, it's my business no matter what, I own 100% of it. So there's not really insecurity in that. It just made more sense for me to listen to others, bring in smarter people, and then we all rise together and we will all do better.

(35:11 - 35:15)

And that is exactly what happened. And to me, that came naturally. I don't think that comes naturally to everybody.

(35:15 - 35:45)

But if you just think that way, then in a restaurant, if you just hiring the way you hire, how you hire, who you hire, and then the training beyond that is so critically important. And so I would definitely put a lot of thought into creating a system that finds you the five-star employee, the ones that will stay, everything is aligned, and you stick to that. And then also the minute you know that somebody is not aligning, you gotta do it.

(35:46 - 35:51)

You have to do it, because it's never gonna get better. It'll never get better. That's so, so true.

(35:51 - 36:00)

So I think what you're talking about is humility. I think in a way, just recognizing where you're at, what you're good at, what you aren't, and then being able to find the people that are good at what you can't do great. So for sure.

(36:00 - 36:12)

But then the other side of it that you just mentioned is, I'll give you an example. When I first started out with opening a restaurant, I had this chef and I was afraid of letting go of this guy. I was afraid, even though he was costing me a bunch of money, we couldn't afford him anymore.

(36:13 - 36:24)

And because I basically didn't know all the processes that are really in the kitchens, I was being held hostage in a way. But it was just my fear of really making those decisions, like doing these things that I didn't wanna do. So- Yeah, I do know what you mean.

(36:24 - 36:33)

It's common, but it doesn't ever get better. And then you use the word hostage, it's almost like the perfect example to use. Like if you're hostage, you can get out of it, because it's not gonna get better.

(36:33 - 36:42)

You have to be better and just make the hard decisions. And then on the other side of that, you're gonna be like, I promise you, you'll be like, oh my God, I can't believe I didn't do that sooner. Like I feel so much better.

(36:42 - 36:48)

Yeah, yeah. How do you push people into doing that? Into making the hard decisions? Oh, you know, I basically don't, to be honest. I have to say, I don't.

(36:48 - 36:52)

Here's the thing. It's almost like parenting. I think a lot of what I do feels like parenting.

(36:52 - 37:08)

Like I have an 18-year-old who literally does the opposite of everything I say. What I've learned over all this time is like, he's gonna do what he's gonna do no matter what, and he's gonna learn through consequences in the hard way. And I feel like that's the same with all of my clients that I'll say over again, that person's still working for you? How's it going? Oh, same thing, okay.

(37:08 - 37:23)

So what would happen if this person called and gave you notice? How would you feel? Oh my God. You know, usually they're like nervous, like really, okay, well then you know, but they never do it immediately. I have to say, even if they do do it, I'm thinking of this one graphic printer shop that I work with one-on-one with him.

(37:23 - 37:31)

He had somebody that was just such a cancer in his business. Oh, and she was running the show, man, but he was nervous. And I mean, I've been telling him for a year.

(37:32 - 37:39)

He finally let her go a year after we started talking about it. And then it's been like bliss ever since then. Bliss.

(37:40 - 37:42)

Yeah. Right. And I think that that's great advice.

(37:42 - 37:48)

And also the way I see it is there is always a better opportunity for the person that you're letting go off somewhere else. Yes. Just not your business.

(37:49 - 37:52)

Yeah, a hundred percent. I do say that, you're right. Yep, very true.

(37:52 - 38:04)

All right. So let's just get a little bit into some personal things here, Casey, and just how you see things. So you're running a business, you're an author, you got family.

(38:04 - 38:20)

How do you manage all of these responsibilities? Because I think this relates not only to any entrepreneur and especially for restaurateurs. So how do you balance all of this stuff? What strategies do you employ to maintain a personal balance, if you may? Well, I mean, there's no 50-50 balance. That's for sure.

(38:20 - 38:27)

That's insane. So I hope nobody actually believes that. Some days it's 20-80, some days it's 5-95, 95-5, whatever it is.

(38:28 - 38:35)

But in order, so yeah, so I own a couple of businesses. I'm an author, that's done, thank God, because that was a year in my life. And then I am a professor at BU.

(38:35 - 38:53)

So most people think that's a lot. I would not have been able to do all of those things, including write the book, which, again, was like a full-time job for about 18 months to 20 months, and now teach at BU full days, two days a week in Boston, if my businesses did not run themselves. And they do.

(38:53 - 39:08)

But I have always built my businesses to run without me. I don't think there is any other way to build a business. I don't understand why anybody would ever build a business that is hinges on them, that to me feels like handcuffs and like shackles.

(39:09 - 39:23)

So from day one, and I learned this from the restaurants, I learned this from the restaurant business. From day one when I built Spark, I built it immediately knowing that I was the chess player and not the chess piece. So I would be hiring the chess pieces and I would move things around.

(39:23 - 39:44)

And I just kept building on that till eventually systems come into play, right? So I'm building the systems, and sometimes I hire smarter people to help me build them. I build the systems because I want the business to run in my likeness, what I would be proud of. And once those systems are built, I bring in the people or my current staff to run the systems in the way that I would.

(39:45 - 40:12)

So it's a kind of layer after layer, but that's what I had always done. And so I got myself to a point a few years back where everything was done by something else. And I was just able to log in and look at a dashboard, a daily dashboard, where at any point I could see exactly where we're at in terms of leads, prospects, sales that were closed, monthly revenue, monthly expenses, just like all the levers you kind of need in your business to make you breathe okay.

(40:12 - 40:20)

That's all I had to do. And I had other people plugging that information in and I would just look at them. And so that freed me up so much time.

(40:20 - 40:43)

So I think that's really it. I knew I was building it to be a business that could stand on its own two feet, like be a big girl and do its own thing so that I could go and make choices to do other things, which has allowed me to open the other businesses, allowed me to write the book, allows me to be a professor because of that. But even if somebody doesn't have other ambitions to do other things, every business should be always be built to be sold.

(40:43 - 40:52)

One, even if you never plan on selling it, you build it to sell it and you should always build it to run without you. Otherwise, I can't even imagine not doing that. I don't know.

(40:52 - 40:57)

I can't even imagine running it where it requires you. I don't know. I don't speak for you.

(40:57 - 41:01)

Yeah. I think it's just also a matter of patience. I don't know how long it took you to build those systems.

(41:02 - 41:07)

Oh, years. I mean, it is patience. But I mean, every year, right now you're the person pulling on the levers and doing all the things.

(41:08 - 41:19)

Then every time you chunk off a piece to somebody else and then watch it. So it's not like I just did it like magic wand, it was done. This took me probably eight years to get to that point.

(41:19 - 41:28)

But every year another piece was gone. So I got more time freed up to do the things that I love, the creative things, to do something a little extra. And then the next year more.

(41:28 - 41:34)

So I'd say now it's 100% runs without me now. 100% runs without me. And better.

(41:34 - 41:37)

I love that. And better. Not to say that I'm not in it.

(41:37 - 41:42)

I still go to the office a couple of days. I mean, I think that's the dream. And it's just amazing.

(41:43 - 41:47)

I think it is. I was speaking to my friend, Jaime Peseca. He's a renowned chef.

(41:47 - 41:55)

Now he's in the 50 best and all that stuff. But it took him 25 years to get where he's at right now. And he told me how he almost shut down his restaurant three times.

(41:56 - 42:00)

And now he's in the 50 best. This is one number one in the world for another list. Like this guy is just, you know.

(42:00 - 42:05)

Wow. And, but that's what he talks about. Took all this patience and building systems and all this stuff.

(42:05 - 42:11)

Now he has a whole lab where he like creates, right, with other people. That's the thing he loves. And that's what he focuses on.

(42:11 - 42:23)

That's his zone of genius, which I love. The book, The Big Leap by Gay Hendricks, one of my favorite books, teaches you about that. To figure out a way to spend the most amount of your time in your zone of genius.

(42:23 - 42:28)

Not your zone of excellence, not your zone of greatness. Those are other things. Like I can bookkeep with the best of them.

(42:28 - 42:31)

I can sell. Those are my zones of excellence. That's great.

(42:31 - 42:40)

But my zone of genius is when I am out of the office and I'm creating something new. Another customer experience where people feel seen. Like that's where I need to spend my time.

(42:40 - 42:43)

So that getting there was my goal. Right. That's awesome, Casey.

(42:43 - 42:55)

So last question. So reflecting on your journey, what is one piece of advice that you wish you would have received earlier in your career? Oh, well, that's easy. That's a layup for me, Sebastian.

(42:55 - 43:17)

So that is, I think I wrote this in the intro in the book, was if I had read Profit First years ago, if it was written out when I still had my restaurants, I would still be a restaurateur today. And I don't know if that's a good thing or a bad thing, right? I don't know, but I know this. Like my restaurants would have been so healthy and solid and cashflow positive that they'd still be there.

(43:17 - 43:31)

And I'd probably have 10 to 20 more of them. I just would have, because this system is so genius, so simple, and just makes so much sense in order to have a business that grows and thrives. That's the one thing.

(43:31 - 43:42)

So I would say for any business, it would be to implement Profit First. If you're a restaurant, definitely implement Profit First for restaurants. You need the specialty because we have certain things that restaurants have that other businesses don't.

(43:42 - 43:55)

Implement that and it would change everything. Not only will you be super successful if your business model works and it better, because if it doesn't, you want to shut down immediately because you're just going to lose money, but also it is being built to be sold. So you could sell it.

(43:55 - 44:03)

You could grow it. You could do so many things with it because you're just going to grow this really solid, profitable business and it's going to be great. That's fantastic, Casey.

(44:03 - 44:13)

So for our audience here, that they want to get in touch with you. How do they go about that? Where can they find you? I know you're all over the place in terms of social media and stuff, but how can they get in touch with you? We have a couple of websites. I'll give you two.

(44:13 - 44:30)

So sparkbusinessconsulting.com. That's spark as in spark plug. So sparkbusinessconsulting.com is kind of our main hub and they can book a deep dive call if you want to become a client or just contact me through the contact form that all comes right to me and to my assistant. So I get all of those.

(44:31 - 44:35)

So that's one. And then you can see kind of everyone that we work with and all the things we do. And we have a shop.

(44:35 - 44:50)

We have online courses, blah, blah, blah. So that's on the Spark website. The other one just for restaurants is in the book, but it's called Profit First, the number four, restaurants.com. So profitfirstfourrestaurants.com. And that's all about the book.

(44:50 - 45:03)

And I've created, and I'm still creating more tools. They're all free, free downloadable tools, like the comment card I mentioned, the marketing plan that I created, the menu costing calculator. All of those are available for free download on that website as well.

(45:04 - 45:10)

That's awesome, Kasey. Well, thank you so much for that. Everybody that's listening out there, just find Kasey online and she's got free resources.

(45:10 - 45:16)

And then, man, if you're struggling with your restaurant, just talk to Kasey. She'll be able to help you out. Yep, I love it.

(45:16 - 45:23)

Kasey, thank you so much for your time. It's really been a pleasure speaking with you. And I hope to actually meet you in person at some point.

(45:23 - 45:26)

We'll probably see each other at a conference. Yeah, I hope so. I'd love that.

(45:26 - 45:29)

I'd love that. This was great. Thank you so much for having me.

(45:29 - 45:31)

Thank you, Kasey. I really appreciate it.