The post Gross Profit: The KPI That Makes or Breaks Hospitality Businesses appeared first on Baxterworld.
]]>It is one of the most important KPIs in the hospitality sector because it reflects how effectively a business turns sales into margin – before overheads like wages, rent and utilities even come into play.
For hospitality businesses, gross profit is typically calculated as:
(Sales – Materials Cost) ÷ Sales
Materials cost usually includes food, drink, and other consumables directly related to what you sell. Expressing gross profit as a percentage of sales makes it easier to benchmark performance over time and against similar businesses. In this instance it’s called gross margin.
While target margins vary depending on concept and location, a small swing in gross profit – even 1-2% – can make a significant difference to annual profitability.
Gross Profit is influenced by several operational factors, many of which are unique to the hospitality sector.
1. Menu Pricing
Pricing isn’t just about what customers are willing to pay – it’s about ensuring margins are built into every item sold. Underpriced menu items can quietly drag overall gross income down, especially if they’re popular sellers.
Regular menu reviews are essential to ensure prices still reflect rising ingredient costs and changes in customer demand.
2. Purchase Prices
Supplier costs rarely stay still. Food inflation, seasonal availability and changes in supplier terms all affect materials cost.
Businesses that don’t regularly review supplier pricing or renegotiate contracts often see their gross profit eroded over time without realising it.
3. Sales Mix
Not all sales are created equal. A coffee shop selling more food items may see a very different gross income to one focused mainly on drinks. Similarly, a restaurant’s margins will vary depending on whether customers favour high-margin dishes or lower-margin staples.
Understanding sales mix helps explain why gross profit changes – not just that it has changed.
4. Kitchen Wastage
Over-portioning, poor stock rotation, inaccurate ordering and menu complexity can all lead to unnecessary waste. In hospitality, wastage doesn’t just reduce gross income – it’s money straight in the bin.
Tight stock controls and clear portion standards are critical to protecting margins.
5. Theft and Shrinkage
Unfortunately, theft – whether intentional or accidental – is a reality in many hospitality environments. Missing stock, unrecorded staff meals, and poor till controls all chip away at gross margin.
Regular stocktakes and clear procedures help identify issues early before they become costly habits.
With rising costs across food, energy and labour, hospitality businesses have less room for error than ever before. Gross income is the first line of defence. If it isn’t right, no amount of cost-cutting elsewhere will fully fix the problem.
Tracking gross income consistently – and understanding what’s driving it – allows business owners to make informed decisions on pricing, purchasing and operations.
Generic financial reports don’t always highlight the real drivers of hospitality performance. Sector-specific insight does.
By analysing gross profit trends alongside menu data, supplier costs and operational processes, specialist hospitality accountants can help identify where margin is being lost – and where it can be recovered.
Gross profit isn’t just a number on a report. It’s a reflection of how well the business is being run.
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]]>The post Strengthen your food safety practices with free support from Food Standards Agency. appeared first on Baxterworld.
]]>Whether you operate a café, takeaway, corner shop, market stall or home-based food business, you can access practical advice to help you:
All resources are available at no cost through the FSA’s online hub, including the popular Safer Food Better Business pack, checklists and easy-to-use e-learning tools suitable for businesses of any size.
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]]>The post So, we asked ChatGPT about challenges businesses face with their accountants. appeared first on Baxterworld.
]]>ChatGPT said:
Small businesses tend to complain about a pretty consistent set of shortcomings when it comes to accountants. It’s usually not about technical competence so much as how the service is delivered.
Here are the big ones that come up most often:
Baxterworld provides monthly accounts showing the real situation up to a few weeks ago rather than reporting on trading 6 to 12 months in the past. This helps management to fix problems before they damage the business. We discuss these results with the client each month, highlighting issues that need dealt with and providing relevant advice.
At Baxterworld we respond quickly and friendly with zero jargon. You can prompt us with any of your questions in plain English, like ChatGPT.
We have real business experience in many sectors particularly in hospitality where our Directors operated cafes and bakeries in the past and have since acquired experience in pubs, hostels, hotels and restaurants. This allows us to pass on our lived-in experience.
We forecast tax payments with all clients on a quarterly basis advising on salary and dividend policy well in advance.
Our mindset is on the client’s side. We devise ways of minimising tax payments and finding routes around barriers.
We have been implementing paperless cloud systems since they were invented at the end of the noughties. We try our best to minimise the time spent by the client on admin work.
We are dedicated to transparency and do not have a clock. Clients can ask questions without a charge. Our fees are fixed and agreed each year in advance with a full breakdown by tasks performed.
Our service and the flow of information is tailored to the needs of each client.
We specialise in helping clients get through emergencies, especially when the business is in danger. We have great experience in protecting assets and re-building damaged operations.
Our staff have weekly contact with clients, dealing with queries and missing information.
In short:
Small businesses don’t just want someone who files things correctly. They want an accountant who:
All of this is in our DNA.
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]]>The post Minimum wage rates increase from 1 April 2026 appeared first on Baxterworld.
]]>The National Living Wage, which applies to workers aged 21 and over, will increase by 4.1% to £12.71. The minimum wage for workers aged 18 to 20 will rise to £10.85, while the rate for those aged 16 to 17 will increase to £8.00.
This increase in the National Living Wage will deliver a real-terms pay rise for low-paid workers and supports the Government’s commitment to ensuring the rate remains at least two-thirds of median earnings. The uplift to the 18–20 year old rate also represents further progress towards alignment with the National Living Wage.
Minimum Wage | Increased Rates from April 2026
You can see the current minimum wage rates alongside the new rates effective from 1 April 2026 in the table below:
| Minimum wage rate | Current rate (2025-26) | New rate (from April 2026) | Increase |
| National Living Wage (21 years old and over) | £12.21 | £12.71 | 4.1% |
| National Minimum Wage (18-20 years old) | £10.00 | £10.85 | 8.5% |
| National Minimum Wage (16-17 years old) | £7.55 | £8.00 | 6% |
| National Minimum Wage (apprentice rate) | £7.55 | £8.00 | 6% |
| Accommodation offset (per day) | £10.66 | £11.10 | 4.1% |
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]]>The post London Restaurants Are Stealing Your Tips From Waiters appeared first on Baxterworld.
]]>Union representatives, including Unite’s Bryan Simpson, have criticized the move as a form of “tip theft”. They have accused businesses of exploiting loopholes to retain customer payments meant for staff.
Other restaurants such as Harrods, The Wolseley, Ping Pong, Big Mamma Group, and Gaucho have introduced similar charges or made changes to how tips are shared. Businesses argue that rising costs – higher wages, taxes, energy, and rent – are forcing them to find new ways to stay financially viable.
Many owners say the fees help cover essentials without raising menu prices. Critics on the other hand warn they confuse customers and disadvantage hospitality workers. Analysts predict that next year will be extremely challenging for the restaurant industry, with more than one in ten UK restaurants at risk of closure.
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]]>The post Is 5G for business beneficial or is it an unnecessary complication? appeared first on Baxterworld.
]]>Compared to 4G, 5G is designed more with business and industry in mind. It moves data quickly, responds almost instantly and can support thousands of devices in one location without slowing down. This makes it ideal for technologies such as smart sensors, automation, real-time monitoring and advanced tools like digital twins. Essentially, 5G opens the door for businesses to innovate and improve processes in ways that weren’t possible with earlier networks.
5G is already being used in many practical ways. For remote and hybrid workers, it enables smooth video calls, rapid file sharing and secure access to cloud systems from almost anywhere. Manufacturers are using it for predictive maintenance and automated equipment, often supported by private 5G networks that offer extra reliability. In retail, businesses are experimenting with augmented reality tools for customers and using real-time data to manage stock more efficiently. Logistics companies benefit from live tracking, automated warehouses and connected vehicle fleets. Even sectors like events, farming and professional services are finding new opportunities through better connectivity.
The technology also brings wider advantages. Faster speeds mean less waiting and higher productivity. Ultra-low latency makes real-time automation and safer operations possible. Greater capacity supports growth in connected devices and Internet of things systems. 5G is also built to be more reliable and more secure, helping businesses adopt advanced tools with confidence. Because 5G works anywhere – not just in fixed locations – it also supports mobile teams and flexible working.
However, adopting 5G does come with challenges. Upgrading devices and systems can be costly, and not all businesses will see immediate returns. Coverage is still uneven, especially in rural areas or inside certain buildings. Older equipment may not be compatible, which could require additional investment. More connected devices can also increase cyber-security risks, meaning businesses need stronger protections. On top of that, some advanced uses of 5G require specialist skills that not every organisation has in-house.
For these reasons, businesses need a clear plan before adopting 5G. It helps to start by understanding which processes would genuinely benefit from better connectivity. Checking local 5G coverage and assessing existing equipment are also important early steps. Many organisations begin with a small pilot project to test the value before rolling it out more widely. Building a business case, preparing a strong data and security strategy, and training staff are all part of a successful implementation. Finally, because technology continues to evolve, it’s important for businesses to stay informed about future developments such as 5G-Advanced and eventually 6G.
Overall, 5G shouldn’t be treated as just a network upgrade but as part of a broader digital strategy. Businesses that approach it thoughtfully will be better placed to innovate, stay competitive and make the most of new technologies as they emerge.
More comprehensive information about 5G for businesses, various use cases, benefits and challenges and it’s future you can find here.
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]]>Companies House fees are to change from 1 February 2026
Companies House had announced that on February 1st 2026 it will increase some of it’s service fees. For example:
Full list of fees you can find on the gov.uk website by clicking here.
Companies House claims, that their fee remain low comparing to those in other countries. We as a practice can agree with that. The annual cost of a GmbH in Germany is over €1000.
Additionally, the Government agency reported, that income from these fees allows it to provide services worth billions to the UK economy, eliminate false or misleading information from their registers and create a safe environment for customers and legitimate businesses. Furthermore, the fees fund The Insolvency Service’s company investigation and enforcement, which controls the legitimacy of directors, prosecution of fraud and financial criminal activity and other offences of companies.
In the future the Companies House plans to modernise and improve the services they provide to keep the UK one of the best places in the world to start and grow a business. This will allow to create a more transparent marketplace and boost economic confidence. By disrupting economic crime Companies House allows legitimate businesses to get the assurance they need to do business in the UK.
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]]>The post Self Assessment payment deadline today – July 31 appeared first on Baxterworld.
]]>If you need a tax return filed, contact [email protected].
The post Self Assessment payment deadline today – July 31 appeared first on Baxterworld.
]]>The post Buying Your First Car (UK): 5 Tips appeared first on Baxterworld.
]]>Before you start car shopping, determine how much you can afford to spend. Consider not just the purchase price, but also continued costs such as fuel and repairs. It’s easy to be swayed by the allure of a brand-new car, but don’t allow yourself to be. But consider a new car instead. One in good condition can be more budget friendly and a sensible choice for a first-time buyer.
Spend time researching different makes and models to find a car that suits your needs and lifestyle. Consider factors such as fuel efficiency, reliability, and maintenance costs. Websites like Autotrader provide comprehensive reviews and price comparisons, helping you make an informed decision. Always remember, a car with a lower initial price might have higher long-term costs due to poor fuel economy or expensive parts.
If you’re not paying cash up front, explore financing options like personal loans, hire purchase, or leasing. Each option has its own pros and cons, so consider what suits your financial situation best. A hire purchase agreement spreads the cost over several years, with the car becoming yours and the end of the contract. Leasing might be a better option if you prefer driving a newer model every couple of years.
Especially when buying a used car, it’s crucial to check its history. Use services like the DVLA’s vehicle information checker to ensure the car isn’t stolen, written off, or has outstanding finance. This step can save you from potential legal issues and financial losses.
Always test drive a car before purchasing to ensure it meets your expectations in terms of comfort and performance. If you’re not knowledgeable about cars, consider bringing a trusted family member or friends to help inspect the cars for any hidden issues.
By following these tips, you can make a well-informed decision when buying your first car, ensuring it suits your needs and budget while providing peace of mind on the road.
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]]>The post Moving Out of your Parents House: 5 Tips appeared first on Baxterworld.
]]>Moving out of your parents’ home is a significant milestone that requires careful planning and preparation. By following these tips, you can navigate this exciting transition with confidence and start enjoying your newfound independence to the fullest. Remember, every challenge presents an opportunity for growth, and this new chapter in your life is no exception.
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