A Nashville 3-location restaurant group had consolidated books hiding a losing location. We rebuilt location-level bookkeeping and found a food cost problem hidden for 19 months.
01The Situation
The owner opened his third location in West Nashville 19 months earlier. The consolidated P&L showed 13% blended EBITDA. He assumed all three locations performed similarly. When we separated the books by location, West Nashville showed 38% food cost versus 28-29% at the other two, 36% labor, 3% EBITDA barely covering rent.
The consolidated average had masked the bleed for the entire 19 months the location had been open. Three root causes found: inconsistent portion sizes, a produce supplier delivering short weights, and measurable theft visible only when theoretical food cost was compared to actual purchases.
02What We Did
We rebuilt the chart of accounts with location tracking on every cost line. Supplier invoices allocated to the receiving location. Labor split from payroll records. First time ever, a proper P&L for each restaurant. All three West Nashville root causes were addressed within 60 days. EBITDA improved from 3% to 14%.
The owner now receives a Monday morning flash report with revenue, food cost %, and labor % by location. Problems are caught in days instead of months.
03Client Impact
One location had been subsidized by the other two. The location-level rebuild changed how the business is managed entirely. He now catches issues in days instead of months.
Breakdown
| Location | Revenue | Food Cost % | Labor % | EBITDA | Status |
|---|---|---|---|---|---|
| L1 Downtown | $1,240,000 | 28% | 31% | 18% | |
| L2 East Nashville | $1,040,000 | 29% | 33% | 16% | |
| L3 West Nashville | $820,000 | 38% | 36% | 3% | |
| GROUP TOTAL | $3,100,000 | 31% blended | 33% blended | 13% |
What changed
Location P&L for All 3 Restaurants
First time owner saw true profitability by location. West Nashville problem immediately visible.
$94K Waste at West Nashville
Three root causes: portion control, supplier short-weighting, theft. All fixed within 60 days.
West Nashville EBITDA 3% to 14%
Now performing in line with the group.
Weekly Flash Report Introduced
Monday morning: revenue, food %, labor % by location. Problems caught in days.
One location had been subsidized by the other two. The location-level rebuild changed how the business is managed entirely. He now catches issues in days instead of months.
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