A café owner balancing bakes and ‘invisible costs’ on £19k

A caf owner balancing bakes and invisible costs on 19k

Welcome to The Money Diaries with Sage, where we swoop into the finances of merchantry owners and discover how they deal with money matters on a daily basis.

We're asking entrepreneurs how they're managing their finances over a seven-day period, to requite you a picture of what incomes and outgoings really squint like from their perspective.

Today is the turn of a café owner balancing bakes and rising energy bills.

And make sure you trammels out Reader's Response at the end of this article, where accountant and best-selling author Carl Reader reveals his thoughts and shares some top tips for our entrepreneur.

Here's what we imbricate in this article:

Meet our entrepreneur and trammels out their Money Diary

  • Date: w/c 2 May 2022
  • Industry: Hospitality/Retail
  • How long you have been an entrepreneur? Two years
  • Day job: This is my full-time job
  • Location: Sunderland, UK
  • Salary: £19,200
  • Household: I live with my partner

Money Diaries day 1

Day 1 - Monday

Mondays are my day off in the shop and are typically quieter than the rest of the week.

Our biggest sellers during the week are hot drinks and cakes, so I try to make sure that the confection section is fully stocked.

My partner makes the bakes and each torch is £3 and financing approximately 90p to make, not including the time taken to make them considering I don’t pay us for the labour.

Though I didn’t need to buy any ingredients today, I will need to replenish stock later in the week.

From Monday to Thursday, I aim to make £200 a day.

The café is in a rented zone in the municipality centre, and trade is massively unauthentic by events, concerts, and shows that have restarted since the coronavirus restrictions lifted. When shows are on, I regularly meet those targets.

I have a milk wordage that arrives on a Tuesday and Friday, and I order unbearable to fully stock our fridge.

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However, considering the weekends are so busy, we unchangingly run out on a Sunday or a Monday and have to buy some more. | purchased four uneaten bottles of milk on Monday, and that forfeit £5.

Not working in the shop on a Monday and Tuesday ways I can do jobs that I can’t do while in the shop, for example going to the bank, doing a stock take, or restocking the shop.

On those ‘days off’ I’ll work approximately three hours. My partner works approximately four hours on a Monday and Tuesday to get on top of the stock.

Today was often quiet. There’s not a lot happening in the zone today so that was understandable. Slightly disappointing, but I know it’ll pick up later in the week.

Money earned: £111.80

Money spent: £5

Money Diaries day 2

Day 2 - Tuesday

Today I need to wall the mazuma taken from the past week. Mazuma takings dramatically reduced in the height of the pandemic however I’ve seen a steady increase over the last six months. Today I banked £346.60.

I well-constructed small tasks like the banking, and collect anything my colleague needs from our stockroom which is at a variegated site.

Generally I try to totally relax on a Tuesday surpassing physically going when to work the pursuit day.

So today, my partner and I will spend the day together, going for supplies or a drink.

My colleague says today was a really good day, and we sold out of bakes. Although we didn’t meet our target, I’d still say it was a really good day.

Money earned: £159.69 £346.60

Money spent: £0

Money Diaries day 3

Day 3 - Wednesday

Wednesday is my first working day of the week. I set up the shop as normal and then work through emails, bills, and invoices.

This has wilt increasingly of a task recently considering energy bills have increased dramatically, so I have to wastefulness invoices that have 30 days to pay versus our energy bills.

Because of the ever-increasing prices of energy and our suppliers, I recently had to raise our prices. All hot drinks have increased by 20p.

This week our milk supplier got in contact to say invoices for the milk need to be paid. For two months of supply, we owed £250.20, which I paid today.

Today is moreover the day that I send our hours to payroll. I work 40 hours a week and my colleague works 20.5 hours. Payroll receives our hours today, but we get paid every Saturday.

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In comparison to other businesses, our wage snout is very small. This ways we have increasingly money to spend on stock.

At the minute all the money we earn gets put when into improving the shop. We are constantly changing, adapting and trying to make it the weightier it can be.

I think that is the reality of having a small self-sustaining business.

I have uncontrived debits for HMRC and rent that come out every Wednesday. These come to £200 all together. I expect these payments to come out every week as they are, of course, a necessity.

I segregate to pay the rent weekly, which spreads the forfeit throughout the month.

Money earned: £148.25

Money spent: £450.20

Money Diaries day 4

Day 4 - Thursday

First thing this morning I had to go to our wholesale supplier for cleaning products, soft drinks, volitional milks, and ingredients for bakes.

I don’t have to go here every week; normally it’s once every two weeks.

Today I spent £157.20. This is an invisible forfeit of the business; for example I don’t pay us when for petrol or time spent making bakes.

This ensures as much money as possible can be put when into the business, and ways we can alimony improving and growing.

I have a uncontrived debit set up with our supplier and pay monthly.

This invoice was due today and is automatically taken from my account. I owed a total of £797.50.

I normally have one large invoice or snout to pay each week. Last week it was the electricity bill, this week it’s coffee.

Most suppliers requite us 30 days to pay and this really helps us manage our accounts.

Money earned: £261.90

Money spent: £954.70

Money Diaries day 5

Day 5 - Friday

Towards the end of the week is when I place a coffee order.

I’m yonder on holiday next week so the order is larger than normal. This ways I won’t have to place flipside one until I return.

As I mentioned yesterday, this is paid monthly, so no money will have been spent today but the invoice for this week is £247.96.

Today is a rented day in the municipality centre as it’s match day.

Events like the match can stupefy our trade but so can the weather. Unfortunately, today was rainy and a little cold. I can guarantee a rented trade if it’s a sunny day.

On Fridays and Saturdays, our target increases to £500.

I moreover see swig sales massively increase on the weekend, for obvious reasons. Throughout the lockdowns, swig was our biggest seller, and I had to transmute the merchantry as hospitality reopened and people returned to the pubs and bars.

I try and make sure the swig section is fully stocked for the Friday. This ways myself or my partner will have to restock the shop. This is flipside job that cuts into our own time.

I find that there are quite a lot of these invisible financing while running your own business. On a Friday, we spend at least three or four hours doing work for the merchantry that cuts into our own time.

I’m tropical to meeting our target today so often I am pleased with how much we have taken.

Money earned: £414.90

Money spent: £0

Money Diaries day 6

Day 6 - Saturday

Today we placed an order with a beer supplier. I’ve ordered eight variegated beers; some are full cases of 24 and some are 12 or 18.

It’s really helpful when breweries offer smaller cases. This ways it’s cheaper and we can offer customers increasingly variety. Today the order came to £349.20, and we won’t need to pay this until next week.

Saturdays are moreover considered a busier day so I don’t have time to do a lot of uneaten jobs.

Generally, I’m making coffees and serving all day.

The café has a webstore so we can sell swig online. We offer pick up as well as local and national delivery. I do the local deliveries personally and then this is flipside invisible forfeit that I absorb.

I get charged monthly by the merchantry who helps create and run our webstore. This is approx $70 (£56).

Therefore I spend quite a bit of my spare time in the shop, updating the webstore, making sure it’s accurate, and subtracting any new inventory.

Since I have to pay large invoices sometimes, like on Thursday, there will be a few days in the week where both of us will try and spend no money at all.

That’s the specimen today and yesterday. This helps build up the mazuma reserves for the week and ensure we aren’t overspending.

We were a bit under target today, however I’m not too disappointed considering there were a lot of smaller sales and not many people ownership larger ticket items.

Today is the day we pay wages and overall it comes to £534.98.

Money earned: £332.55

Money spent: £534.98

Money Diaries day 7

Day 7 - Sunday

We don’t set a target for Sunday considering it can be hit and miss, it’s really difficult to predict.

Today was the Sunderland Municipality Runs half marathon and 10k.

We, luckily, were on the route to the start line for the runners, meaning it was a really rented day, selling out of all bakes we had to offer and having to replenish the milk twice.

We have limited opening hours on a Sunday and it is a really pleasant shift, expressly when we see so many new faces in the shop, like today.

I try and limit the value of spare work on a Sunday, so we can be a little bit increasingly chilled.

Money earned: £360.96

Money spent: £8.50

Total money earned: £2,136.65

Total money spent: £1,953.38

Final thoughts on the week

Overall, it was an OK week. It could have financially been largest on some days but I’m not disappointed by the figures.

I had a large invoice come out and I had to go to the wholesalers this week so I spent quite a lot.

I’ve learned that we both unquestionably spend a lot of time doing invisible jobs, but it’s a necessity and comes with running the business.

I’ve learned that I spend a lot of time balancing invoices, which requite us 30 days to pay and by doing that, it allows me to alimony ordering stock.

Managing finances can be difficult and my translating is don’t be tempted to over spend.

Try and set yourself targets and make changes to help meet them.

  • Something I bought to treat myself: Went out for a meal with my partner.
  • An unexpected forfeit that cropped up: The large invoice for the coffee order. I know it comes out every month but it slipped my mind that it was this week.

Reader’s Response

And to wrap up… what are Carl Reader’s thoughts on the financial habits of our café owner?

Check out the video unelevated to find out…

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