AI, Apps & Technology: Where Do They Fit Into Your Business Strategy?

AI, Apps & Technology: Where Do They Fit Into Your Business Strategy?

From delivery drones and burger flipping robots…to AI powered drive thru service, phone answering technologies, and online reservations…to integrated inventory, ordering and point of service systems, food delivery apps and more, restaurants are being bombarded with a variety of technology solutions that they purportedly need to survive and thrive. While new and emerging technologies will no doubt play a role in the future of restaurants and how they operate, before rushing forward it may be in your best interest to take a step back by clarifying your business strategy and plans, and then considering which solutions can help you meet your goals.

What type of restaurant do you own? What are your short- and long-term growth goals and plans? Who are your customers, what are their demographics, and what do they expect when they visit or order from your establishment? What are the major brand attributes that drive your business success? How are your finances – profit margins, cash flow, cost of goods sold, inventory costs, and more? What are your biggest pain points? What are you hoping to improve? How do you measure success?

Having a clearly defined strategy puts you in a better position to protect the assets and attributes that contribute to your current-day successes, while clarifying which types of technology may make the most sense for your business going forward.

Today, there are technology solutions for virtually every aspect of running a restaurant. In truth, not all of them are a good fit for every restaurant. For example, a fine dining establishment is going to have to make a call about whether clients expect a live person answering a phone to take a reservation or a chatbot sending them a link. A casual dining establishment is going to have to determine whether adding a mobile food services platform is going to help or hurt margins. A quick serve restaurant may have to weigh the advantages of AI drive thru verses potential impact on on-site dining.

Once you have a clear strategy and goals, it’s easier to determine where AI and technology may fit and can add the most value.

When it comes to inventory, purchasing, and supply chain, AI solutions can analyze historical data on sales, customers, and more to more accurately forecast demand and supply, helping reduce waste from over-ordering and food spoilage. Some solutions can help track shipments so you can quickly respond to delays. Others can track upcoming menu promotions, ingredient levels, and expiration dates. There are also solutions that use real-time data for dynamic menu pricing that responds to price fluctuations and market conditions.

When it comes to labor, technology solutions – like drive thru AI, self-ordering kiosks, and online reservations or ordering – are available to free staff up to focus on value-added activities (i.e., customer service or food preparation). Other types of systems help managers make appropriate staffing decisions and monitor performance.

When it comes to customer service, solutions are available to immediately answer customer questions; make recommendations; handle reservations; facilitate easy, quick payments; and streamline ordering.

As for marketing, AI tools and solutions can help you analyze social media data to understand how customers feel about your restaurant, what customers are looking for so you can customize campaigns, and address concerns quickly. You can also use AI to help create content and images for a variety of channels (website, email, social media etc.).

There are also tools to help monitor, log, and automate food safety compliance-related tasks like temperature and cleanliness. And if your brand and reputation, in whole or in part, links to environmental, social and governance (ESG) activities, there are solutions that can help track and monitor your performance in priority areas so you can share this information with customers who support your establishment because of aligned values.

Taking a cue from large chains, we’re seeing AI used to monitor inventory; predict purchasing needs; forecast demand; answer customer questions and complaints; account for weather, traffic and seasonal swings; manage scheduling; stay on top of equipment maintenance; take reservations; create, adjust and personalize menus and prices; make recommendations to customers; take orders; manage the entire drive thru encounter; pay from tableside; ID trends; create and execute marketing plans; and more.

Ultimately, if the AI and technology solutions you choose to invest in align with your brand and support your goals, your business can benefit. Staff can be freed up to focus on value-added activities. Managers can make more informed decisions about staffing, menus, pricing, and inventory. The customer experience can be enhanced and productivity increased, while waste and mistakes are minimized.

Moving forward requires an unwavering commitment on your part to protect client’s data, train staff, re-engineer processes, and ensure your technology investment enhance the key reasons customers visit or purchase from your establishment in the first place.

As you consider which technology solutions best support and align with your goals, brand, and business, we want you to know you can count on RBT CPAs for your accounting, tax, audit, and advisory needs. We’ve been proudly serving municipalities, businesses, non-profits, and individuals in the Hudson Valley for over 55 years. Please don’t hesitate to give us a call and find out how we can be Remarkably Better Together.

 

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Estate & Succession Planning: A Necessity for Family-Owned Restaurants

Estate & Succession Planning: A Necessity for Family-Owned Restaurants

Running a family-owned restaurant is often a labor of love, with each generation imparting their unique flavor to the business. However, to ensure that your legacy – and the impact it can have on loved ones and assets (including your restaurant) – plays out according to your wishes, it is crucial to have a comprehensive estate and succession plan in place.

Estate planning helps you define how your personal affairs and assets should be managed while you are alive and confirms what will happen upon your death. When it comes to your business, an estate plan can foster a smooth transition of leadership and operations by including a succession plan.

What’s more, estate planning helps maximize the value of your assets that go to your beneficiaries, while minimizing tax obligations. As it relates to your restaurant, it can be used to establish buy-sell agreements, significantly reduce tax burdens on heirs, protect it from creditors, and shield it from being used to settle taxes or personal debts.

It’s never too early to put a plan in place, but there is a time when it’s too late. Failing to create, review, and update a plan at least once a year can have a significant impact on the people you want to take care of, the value of your estate, your tax obligations, and the legacy you leave behind. With major changes to Federal laws scheduled to take effect in just over 22 months plus the impact of New York laws, it’s even more important that you make the time to create and update your estate and succession plan now.

The importance of estate and succession planning cannot be overstated. Without a clear successor, especially when there’s a sudden occurrence resulting in disability or death, a restaurant may face significant upheaval and operational challenges. This has the potential to lead to a restaurant’s closure or sale. Family discord may arise due to different visions for the restaurant’s operation. Creditors and vendors may look for payment in full.

There are also tax implications. Without an estate plan, for instance, the restaurant may be subject to hefty estate taxes that could impact the financial health of the business. A well-crafted plan can optimize tax benefits and protect the restaurant’s assets.

Just as you wouldn’t want state law to dictate how to take care of your family and business today, you shouldn’t want it to dictate what happens to your business (and family) upon your disability or death. There’s one way to ensure that doesn’t happen: develop an estate and succession plan today and make sure it’s always up to date by reviewing it annually.

RBT CPAs professionals in our Estate, Trust and Gift Practice can help you create and update an estate and succession plan that gives you peace of mind in knowing you, your loved ones, and your business will be taken care of according to your wishes during your lifetime and after. Please don’t hesitate to give us a call and find out how we can be Remarkably Better Together.

 

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Last-Minute Moves to Maximize Section 179 Tax Advantages

Last Minute Moves to Maximize Section 179 Tax Advantages

Have you been thinking about purchasing new or used equipment to enhance services? How about upgrading technology and software?

With end of year approaching, you have limited time left to consider whether to purchase, lease, or finance certain assets to take advantage of Section 179 tax benefits. It’s also a good time to consider how Section 179 may play into your business and tax strategy for 2024.

Section 179 uses first-year expensing. That means you can deduct the expense for an eligible asset immediately, rather than depreciating it over time. It serves as an incentive for a business owner to invest in the business and enhance its capabilities and services with the purchase and installation of capital equipment.

One big caveat: You must put the asset you purchase into service the year that you plan on taking the deduction. With just weeks left in 2023, it will be important to account for this in your planning.

Most small and mid-sized business owners qualify for Section 179 deductions. Qualifying purchases can include dining room furniture and kitchen equipment; POS systems, computers, and software; certain vehicles (some with annual deduction limits); machinery; and more. Security systems, HVAC systems, roofs, fire protection systems, and other structural improvements to non-residential buildings may also qualify for a Section 179 deduction.

Equipment can be new or used (as long as you weren’t the prior owner). It can be purchased outright, financed, or leased. So, let’s say you want to purchase qualifying equipment for $1 million and you have $250,000 for the down payment and finance the remaining $750,000. As long as the equipment is put into service this year, you can deduct the full $1 million this year.

Through 2026, there’s an added bonus. For expenses not eligible for the Section 179 deduction, there’s a bonus depreciation allowance in year one. For 2023, bonus depreciation is 80% — remember, that’s in addition to regular depreciation. The bonus depreciation decreases for the next three years (60% for 2024, 40% for 2025, 20% for 2026). Starting in 2027, this additional benefit will no longer be available. Because of this phase out, businesses benefit the most by making capital purchases sooner rather than later.

Section 179 numbers to know for 2023:

  • Maximum 179 deduction: $1,160,000
  • Phaseout threshold begins at $2,890,000 and ends at $4,050,000. (So, if you buy eligible assets that cost more than $2,890,000, your maximum 179 deduction is reduced dollar for dollar by amounts over $2,890,000. Purchases above $4,050,000 are not eligible for a 179 deduction, but bonus depreciation can still apply.)
  • Bonus depreciation: 80%

If you need help determining whether to act quick to take advantage of Section 179 this year or whether to make it part of your tax strategy for 2024, your RBT CPA client manager can help – reach out to him/her today. Please remember RBT CPAs is here to help with your accounting, tax, audit, or business advisory needs. Interested in learning more? Give us a call today.

 

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

An Update on New York’s Minimum Wage to Take Effect January 1

An Update on New York's Minimum Wage to Take Effect January 1

Earlier this year, Governor Hochul announced annual increases to New York’s minimum wage to help low-wage employees keep up with the rising cost of living.

Beginning January 1, 2024, New York’s minimum wage will increase to $16 in New York City, Nassau, Suffolk, and Westchester. For all other areas in the state, it will increase to $15.

In addition, we are awaiting final word on whether the NYS DOL will approve proposed changes to hospitality wage orders as published in the State Register October 4, 2023. If approved as is (which is expected), effective January 1, 2024, wages for food service workers in:

  • NYC, Long Island and Westchester will be $16 for minimum wage; $10.65 for cash wage; $18.65 for overtime cash wage and $5.35 for tip credit.
  • All other parts of New York will be $15 for minimum wage; $10 cash wage; $17.50 for overtime cash wage and $5 for tip credit.

Starting January 1, 2027, increases will be tied to inflation and based on the three-year moving average of the Northeast Region’s CPI for Urban Wage Earners and Clerical Workers (CPI-W). This is intended to help maintain the purchase power of workers’ wages from one year to the next.

As of when this article was written (December 15), we are still awaiting final word on whether the NYS DOL will approve proposed changes to hospitality wage orders as published in the State Register October 4, 2023. This will result in changes to wages for food service workers (as noted above), wages for hospitality service employees, meal credit and uniform allowance.  Finally, there are proposed changes to the salary exempt threshold effective January 1, 2024.

We will let you know when these proposed adjustments are approved. In the meantime, it’s a good idea to consult your employment or labor attorney to ensure compliance.

To free you up to focus on these and other important aspects of running your business, please remember RBT CPAs is here to help with your accounting, tax, audit, or business advisory needs. Interested in learning more? Give us a call today.

 

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Tip Credit in New York: What You Need to Know

Tip Credit in New York: What You Need to Know

As New York State increased its minimum wage for 2024, many wondered what was going to happen with the “tip credit.” The answer was announced at the end of December. Here’s a recap…

To start with the basics, the Federal government sets minimum wage. Since New York sets a higher minimum wage, it takes precedence. In New York, the minimum wage increased/is increasing effective January 1, 2024, 2025, and 2026. At the same time, the hospitality industry will experience increases in tip credits.

Hospitality employers can meet the required minimum wage through a combination of cash wages and a tip credit, which is a credit or allowance for tips employees receive from customers. The amount of the cash wage and tip credit varies by region and job classification.

Effective January 1, 2024 through December 31, 2024:

For service employees (i.e., employees who don’t serve food or beverages but typically receive tips like a bathroom attendant):

  • In NYC, Long Island, and Westchester County, the cash wage is $13.35 and the tip credit is $2.65.
  • In the remainder of New York State, the cash wage is $12.50 and the tip credit is $2.50.

For food service workers (i.e., employees who serve food or beverages and typically receive tips, like a waiter or bartender):

  • In NYC, Long Island, and Westchester County, the cash wage is $10.65 and the tip credit is $5.35.
  • In the remainder of New York State, the cash wage is $10 and the tip credit is $5.

However, hospitality employers cannot take the tip credit on days when a tipped worker spends more than 2 hours or 20% of a shift doing non-tip work and on weeks when service employees’ tips are lower than:

In resort hotels:

  • In NYC, Long Island and Westchester County: $8.95.
  • In the remainder of New York State: $8.40.

In restaurants and all-year hotels:

  • In NYC, Long Island and Westchester County: $3.45.
  • In the remainder of New York State: $3.20.

So, we enter 2024 with a New York tip credit intact, continuing the several-years-long debate on whether to eliminate sub-minimum wage for tipped workers. We’ll keep you updated as we learn more.

 

While your employment or labor attorney is the best person to contact with questions about wages, when it comes to accounting, tax, audit, or business advisory needs, RBT CPAs is here for you. Please don’t hesitate to give us a call.

RBT CPAs is proud to say 100% of its work is prepared in America. Our company does not offshore work, so you always know who is handling your confidential financial data.

Know Your Limits: Income & HOTMA Final Rule

Know Your Limits: Income & HOTMA Final Rule

On May 15, 2023, new income limits – which are used to define low-income status and eligibility for many HUD housing assistance programs – took effect.  Limits are based on the 2021 American Community Survey (ACS), since the 2020 collection data did not meet the Census Bureau’s Statistical Data Quality Standards largely due to the impacts of COVID. This resulted in the release of the new income limits six weeks later than usual.

To see the income limits for New York, click here. For Multifamily Tax Subsidy Projects (MTSP) Income limits, click here.  For HOME Income limits (which take effect June 15, not May 15), click here.

A BETA test version of the Novogradac Rent & Income Limit Calculator© is available for “the use of housing professionals who have an understanding of income and rent limits and the program requirements for each program.”

In addition, on February 14 of this year, the final rule for the Housing Opportunity through Modernization Act of 2016 (HOTMA) provisions 102, 103 and 104 was issued. As noted by the National Low Income Housing Coalition, changes to:

  • Section 102 affect how assisted households’ income and assets are calculated for them to gain admission to and remain in assisted housing.
  • Section 103 incorporate a new rule for public housing households whose income exceeds the maximum allowed (a.k.a. over-income provisions). Additional guidance was issued in March.
  • Section 104 provide guidance on recertifying a household’s income.

Changes affect those assisted through Public Housing, House Choice Voucher, Section 8 Project-Based Rental Assistance, Section 102 Supporting Housing for the Elderly, Section 811 Supportive Housing for Persons with Disabilities, HOME Investment Partnerships (HOME), and Housing Trust Fund programs.

Mark your calendar with these important dates related to the final rule:

  • March 16, 2023 Over-income provisions in Section 103 for PHAs administering the Public Housing program took effect.
  • June 14, 2023 PHAs must implement over-income requirements and policies. (See the Section 103 Fact Sheet for more information.)
  • January 1, 2024 PHAs must implement the income and asset changes in Sections 102 and 104.

For additional resources, including recorded training webinars, visit the U.S. Department of Housing and Urban Development HOTMA Resources webpage.

While you’re getting acquainted with the new income limits and HOTMA final rule, RBT CPAs can help lighten your load by partnering with you on your accounting, tax, audit, and advisory requirements. We’re a leading CPA firm in the Hudson Valley and believe we succeed when we help our clients succeed. Plus, you can be 100% confident that your confidential data is only being handled by our local employees – we don’t outsource or offshore. To learn more, give us a call.

 

Important Note: RBT CPAs is not a law firm. Should you need legal guidance on income limits or the HOTMA Final Rule, it’s best to consult your legal resources.

Clear The Air: New Carbon Monoxide Alarm/Detector Requirements Are in Effect

Clear The Air: New Carbon Monoxide Alarm/Detector Requirements Are in Effect

A few years ago, following the deaths of housing residents due to Carbon Monoxide (CO), the U.S. Department of Housing and Urban Development (HUD) began working on federal legislation to ensure it would never happen again. Under the Appropriations Act of 2021, new federal rules for CO alarms and detectors took effect December 27, 2022. Here’s what you need to know…

CO is a toxic gas that has no smell or color. When it builds up, it can be deadly to people and pets in just a matter of minutes. It can also leave those who inhale it with permanent brain damage, cardiac issues, cause miscarriages, and numerous other short- and long-term health issues. When fuel burning in stoves, grills, fireplaces, gas ranges, furnaces, lanterns, small engines, cars, trucks, and more doesn’t completely combust, CO is generated. Still, it doesn’t have to go undetected thanks to modern-day CO alarms and detectors that can save lives and protect health.

As reported by the National Low Income Housing Coalition, the new requirements apply to all authorities that provide Public Housing, Housing Choice Voucher (HCV), Project-Based Voucher (PBV), Project-Based Rental Assistance (PBRA), Section 202 Supportive Housing for the Elderly, and Section 811 Supportive Housing for Persons with Disabilities programs. Housing Opportunities for Persons with AIDS or HOPWA-assisted housing is also covered.

Overall, the new rules require CO alarms or detectors meet or exceed standards in 2018 International Fire Code Chapters Nine and Eleven, and be installed in covered units and buildings that have fuel-burning appliances and/or an attached garage. (When state or local laws regarding CO are more stringent than the federal requirements, the state or local laws govern.)

The notices issued by HUD also stress the importance of and guidance on preventing CO from entering buildings and units in the first place, with properly installed and maintained appliances and proper ventilation. If you own/run housing that receives federal rental assistance, consider having maintenance staff proactively visit and inspect all units for compliance. Also check the unit’s/building’s ventilation and fuel-burning appliances’ hookups. Then, at least twice a year, make sure alarms/detectors are operational and running correctly.

Finally, consider educating residents about the risks of CO and why the alarms and detectors are so important. The federal rules indicate HUD will make available educational materials on its website that can be used for educational purposes.

For more information, refer to these resources:

Earlier this month, HUD introduced two funding opportunities to improve public housing health; one of the opportunities includes Public Housing Authority (PHA) funding for “evaluating and mitigating threats to public housing residents, such as lead-based paint, carbon monoxide, mold, radon, fire, and asbestos.”

As stated in the press release, “PHAs have until April 13, 2023, to apply for the $165 million HRHLBP NOFO through Grants.gov. HUD encourages eligible applicants to apply and has made this funding available earlier in the fiscal year with more time for applicants to apply in order to facilitate a diverse set of applications.”

Of course, if you need assistance figuring out how to expense the alarms/detectors – or anything related to accounting, taxes, audit, or advisory services – please contact us at RBT CPAs. We’re a leading accounting firm in the Hudson Valley and beyond, with extensive experience supporting HUD agencies and owners.