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Money In, Money Out: Understanding Your Finances

Learn how revenue from orders and costs from ingredients and expenses come together in BakeOnyx to give you a clear picture of your profitability.

Money In, Money Out: Understanding Your Bakery's Finances

This article will help you understand how BakeOnyx tracks your bakery's money, from the cash coming in from customers to the costs of ingredients and other business expenses. You'll learn how to see your bakery's profitability at a glance and how to make smart decisions based on your financial data.
  • Understand how revenue from orders is recorded in BakeOnyx.
  • Learn how the cost of ingredients (COGS) and operating expenses are tracked.
  • Discover how to use BakeOnyx reports to understand your bakery's profitability.

The Flow of Money in BakeOnyx

BakeOnyx is designed to give you a clear picture of your bakery's financial health by tracking money in and money out. Here's how it works:

Money In: Revenue from Orders

Every sale you make contributes to your bakery's revenue.
  1. Navigate to the Orders section in BakeOnyx.
  2. When an order is marked as Delivered and a payment is recorded, that amount is added to your total revenue.
  3. BakeOnyx supports multiple payment methods for a single order, including cash, card, bank transfer, and online payments through integrated services like Stripe or Square.
  4. You can track partial payments, so you always know how much has been paid and what balance is still outstanding.

Money Out: Cost of Goods Sold (COGS)

COGS represents the direct costs of making the products you sell, primarily your ingredients. BakeOnyx automates this calculation for you.
  1. Ensure that all the products you sell are linked to their respective Recipes in BakeOnyx.
  2. When an order is placed for a product with a linked recipe, BakeOnyx automatically calculates the cost of the ingredients used based on the quantities in the recipe and the costs you've entered for your ingredients.
  3. This means you don't have to manually enter COGS for each order. The costs are derived directly from your ingredient purchases and recipe definitions.

Money Out: Operating Expenses

These are all the other costs associated with running your bakery that aren't direct ingredient costs.
  1. Go to the Expenses section in BakeOnyx.
  2. Click on Add Expense to record a new cost.
  3. Fill in the details for each expense:
    • Date: When the expense occurred.
    • Category: Such as Rent, Utilities, Marketing, Packaging, etc.
    • Amount: The total cost of the expense.
    • VAT Amount: If applicable, enter the VAT or sales tax amount.
    • Vendor: Who you paid.
    • Description: Any relevant notes about the expense.
Note: It's crucial to categorize your expenses correctly. If an item is an ingredient that goes into your products, track it through Purchase Orders and your Recipes (which contributes to COGS). If it's a cost to keep your business running, like rent or marketing, record it as an Expense. Avoid entering the same cost in both places, as this will lead to inaccurate financial reporting.

Bringing It All Together: The Profit and Loss (P&L) Report

The P&L report is where all your financial data comes together to show your bakery's profitability.
  1. Navigate to the Reports section in BakeOnyx.
  2. Select the Profit and Loss report.
  3. This report shows:
    • Total Revenue: All the money earned from your orders.
    • Cost of Goods Sold (COGS): The total cost of ingredients used in sold products.
    • Gross Profit: Revenue minus COGS.
    • Total Operating Expenses: All recorded business expenses.
    • Net Profit: Gross Profit minus Operating Expenses. This is your bottom line.

Key Financial Concepts

Budget vs. Actual Expenses

You can set monthly budgets for your operating expense categories in the Settings section under Overhead Costs. The Expense Report will then compare your actual spending against these budgets, helping you identify areas where you might be overspending.

VAT Tracking

When you record expenses, you can enter the VAT amount. BakeOnyx tracks this, which can significantly simplify your tax reporting. You can easily export expense data with VAT breakdowns for your accountant.

Which Reports to Check and When

* Weekly: Check the P&L Summary for a quick overview of your revenue versus costs. * Monthly: Review the full P&L Report for detailed insights, the Food Cost Report (aim for 25-35% of revenue), and the Expense Report to compare against budgets. * Quarterly: Look at the Customer Report to understand who your most valuable customers are.
Tip: Record your expenses as they happen, rather than waiting until the end of the month. Keeping your expense data up-to-date ensures your reports are always accurate and useful for making timely business decisions. Checking your P&L Summary every Friday afternoon is a quick habit that keeps you informed about your bakery's financial performance.

What BakeOnyx Automates

  • Calculation of COGS based on recipes and ingredient costs.
  • Tracking of revenue from recorded order payments.
  • Comparison of actual expenses against set budgets.
  • Generation of comprehensive P&L reports.
  • Calculation of food cost percentage.
  • Tracking of VAT on expenses.

Next Steps

The summary, FAQ, and statistics in this section were compiled from public sources and reviewed by the BakeOnyx editorial team. AI-assisted research.

Frequently Asked Questions

What's the difference between COGS and Expenses for a bakery?▾

COGS (Cost of Goods Sold) specifically refers to the direct costs of ingredients that go into your baked goods, such as flour, sugar, and butter. These are typically entered through purchase orders. Expenses, on the other hand, are the ongoing costs of running your business, like rent, utilities, insurance, and marketing. Accurate categorization prevents double-counting.

How often should I review my bakery's financial reports?▾

It's recommended to review key financial reports regularly. A weekly Profit & Loss (P&L) Summary helps you quickly see if you're making money. Monthly reports, like a Food Cost Report, are essential for understanding what percentage of your revenue is spent on ingredients and for identifying potential areas for cost savings.

Why is it important to avoid double-counting costs in my bakery?▾

Double-counting costs leads to an inaccurate picture of your bakery's profitability. If you count ingredient costs both when you purchase them and again when they are used in a recipe, your expenses will appear artificially high, making your business seem less profitable than it is. Proper tracking ensures financial clarity.

What is a P&L Summary and why is it important?▾

A Profit & Loss (P&L) Summary, often reviewed weekly, is a vital financial report that shows your bakery's revenue minus its expenses over a specific period. It provides a quick snapshot of your business's profitability, helping you identify trends and make timely operational adjustments to ensure you are generating a profit.

How can bakery management software help with financial tracking?▾

Bakery management software like BakeOnyx can automate and simplify financial tracking. It helps differentiate between ingredient costs (COGS) recorded through purchase orders and operational expenses. This ensures accurate data for reports like the P&L and Food Cost Report, providing a clearer view of profitability and aiding in better business decisions.

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