The Professional Personal ChefThe Professional Personal Chef 11

Chapter 6Chapter 6

FinancesFinances

The Professional Personal ChefThe Professional Personal Chef 22

3 Different Costs3 Different Costs

• One time costOne time cost– Deposit or licenseDeposit or license

• Fixed costFixed cost– A cost that does not change as sales A cost that does not change as sales

changechange

• Variable costVariable cost– A cost that changes as sales changeA cost that changes as sales change

The Professional Personal ChefThe Professional Personal Chef 33

Start UP CostStart UP Cost

• License / FeesLicense / Fees

• Insurance Insurance

• Professional serviceProfessional service

• Phone / Web set up Phone / Web set up

• Office equipment Office equipment

• Printing costPrinting cost

• CookwareCookware

The Professional Personal ChefThe Professional Personal Chef 44

Fixed CostFixed Cost

• Vehicle paymentVehicle payment

• RentRent

• Web-hosting feeWeb-hosting fee

• Association feesAssociation fees

The Professional Personal ChefThe Professional Personal Chef 55

Variable CostVariable Cost

• Cost of foodCost of food

• Cost of fuel used in transportation Cost of fuel used in transportation

• Uniforms / LinensUniforms / Linens

The Professional Personal ChefThe Professional Personal Chef 66

Finding Capital Finding Capital

• How much do you need ?How much do you need ?– In what time frame ?In what time frame ?

• What resources do you have ? What resources do you have ? – Savings / family / friends ? Savings / family / friends ?

• How much are you willing to pay ?How much are you willing to pay ?– InterestInterest

The Professional Personal ChefThe Professional Personal Chef 77

Finding Capital Finding Capital

• Your credit history Your credit history – Credit report Credit report

• How will repay the loan ?How will repay the loan ?

• How much of your own money will be How much of your own money will be at risk ?at risk ?

• Personal references Personal references

The Professional Personal ChefThe Professional Personal Chef 88

Cash Management Cash Management

Cash from Sales

Your Personal Chef Business

Cash thatPays the Bills

Cash Flow through your business

The Professional Personal ChefThe Professional Personal Chef 99

Cash FlowCash Flow

• Positive Positive – More monies coming in than going outMore monies coming in than going out

• It’s a GREAT thing!It’s a GREAT thing!

• Negative Negative – More monies going out than coming in More monies going out than coming in

• Must be short livedMust be short lived

• Breakeven pointBreakeven point– Where positive and negative cash flow balanceWhere positive and negative cash flow balance

The Professional Personal ChefThe Professional Personal Chef 1010

Planning On ProfitPlanning On Profit

Sessions per month

Income per session

Total gross receipts

Variable + Fixed Cost

Net Profit

X

=

-

=

The Professional Personal ChefThe Professional Personal Chef 1111

YieldYield

• As purchased (AP)As purchased (AP)

• Edible portion (EP)Edible portion (EP)

• EP / AP = Yield EP / AP = Yield

The Professional Personal ChefThe Professional Personal Chef 1212

Yield CostYield Cost

• Example Example – Whole fish AP 6 lbs @ $4.00 per pound Whole fish AP 6 lbs @ $4.00 per pound – After cutting After cutting

•3 lbs EP3 lbs EP

– 6 lbs AP / 3 lbs EP = .50 (%)6 lbs AP / 3 lbs EP = .50 (%)– $4.00 / .50 = $8.00 per pound EP$4.00 / .50 = $8.00 per pound EP

The Professional Personal ChefThe Professional Personal Chef 1313

Setting Up Your BooksSetting Up Your Books

• Use a system that you are Use a system that you are comfortable with comfortable with

• Do your “bookkeeping” every week, Do your “bookkeeping” every week, same day same time same day same time

• Keep an accounting journal Keep an accounting journal – Save ALL receipts Save ALL receipts