Festival Network Online Newsletter
Commercial Vendors Edition - June 2006
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A note from the editor...Hey Commercial Exhibitors and Food Vendors,
Robert Berman of Mobile Catering Business wrote this article regarding tracking expenses in a mobile business. Although he targets food vendors in his example, the system he lays out can work for any traveling exhibitor.
Let me know what you think!
Tracking Expenses In A Mobile Business
Keeping track of expenses in any business can be a very frustrating exercise and even more exasperating for a business that is on wheels and moves to numerous locations throughout a state and/or country.
Food concession operators face this challenge each and every day.
Small expenses such as gas, a refill of propane, a container of cooking oil or something as simple as a new mop can, over a period of a year add up to hundreds of receipts and even more important thousands of dollars.
The use of credit cards does not solve the problem, as credit card statements do not delineate expenses sufficiently for tax purposes.
To help solve the challenge of ensuring that all expenses are properly accounted for requires a two pronged approach.
1. The first and most important is a commitment by all those incurring the expenses to follow the procedure that is set in place to handle the receipts. It is very easy to apply the procrastinators’ concept of “I will do it later”. If you apply this attitude, the system will not work. There must be diligence and a commitment by all those involved to ensure that the system will work.
2. The second is the system. I highly recommend the use of an accordion file. Accordion files are relatively small, inexpensive, reusable and most will fit in a glove compartment and allow for filing receipts in a somewhat systematic order. Most accordion files use a number or other heading to define each of the pockets within the folder. I recommend that each of the compartments is labeled with an expense heading. A compartment for gas receipts, equipment repairs, food and other raw material expenses, hotel, meals, fuel (if you are purchasing items such as charcoal or propane) and of course a miscellaneous category.
The key behind the success of the system is to ensure that every time a receipt is obtained it is placed in the appropriate compartment in the accordion folder as soon as it is received. Placing receipts in wallets, shirt or pants pockets or leaving it in the store bag with the intent of accounting for it in the evening will not work. That is why it is important that the accordion file be placed in a convenient location such as the glove compartment.
If you can log the expenses into a computer spreadsheet or other type of accounting system every month then you can reuse the accordion file on a monthly basis. If you utilize the services of a bookkeeper, it may be wise to use a new accordion file for each and every month. That will allow you to deliver the receipts to the bookkeeper at year end in a manner which will allow that individual to easily compute your yearly expenses, saving you additional expense.
Having a system in place to properly account for all expenses can save concession operators hundreds of dollars in tax each and every year.
Article provided by:
Robert Berman, owner of the website mobilecateringbusiness.com: the only website and forums exclusively for food concession, vending cart and mobile catering businesses.
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