King, who has since remarried, says when it comes to spending and managing money, frugality is the buzzword and keeping Delta’s on sound financial ground is a main priority. King observed how her mother managed four rental properties in California and Arizona. The main lesson she took away was how to establish and maintain cash flow.
“By putting money back into a business and reinvesting in the core product, a business owner will always have a steady flow of cash,†she says. “Personal money management works the same way.â€
As co-owners of a business, Suggs and King give themselves modest salaries from their restaurant’s profits. The salaries vary slightly and depend on how well the business does, seasonal expenses, or special events. Occasionally, the two have had to forgo paychecks in order to meet the payroll or pay for an unexpected expense at the restaurant. “Fortunately, that has only happened a few times,†King says. “We pay our employees before we pay ourselves.â€
Delta’s has 15 full-time employees and 30 part-timers. The biweekly payroll averages about $28,000. In 2009, the restaurant implemented Web-based restaurant management software called Restaurant Solutions Inc. The software is designed for restaurateurs and manages virtually everything associated with the business: payroll, inventory, accounts receivable, and accounts payable.
“Our year is comprised of 13 four-week periods,†King says. “We count inventory and enter payroll, sales, and all bills and invoices weekly. This allows us to compare Delta’s operations week to week, period to period, and enables us to accurately track income and expenses.â€
As for the expansion into Charlotte, Suggs and King say the decision to set up shop in North Carolina came after months of research. The city has an African American population of about 33%, and they found no upscale soul food multiunit venues in the city. “We found a place on the main street in Charlotte and put together a solid business plan, raised capital, and put funds in an escrow account,†Suggs says. They’re scheduled to sign the property lease this month.
Although savvy money management has helped make establishing and maintaining a business easier for Suggs and King, the road has had detours.
Delta’s opened with the furniture that belonged to the previous restaurant. About a year later, “we were in dire need of chairs and barstools, but didn’t have all of the funds to purchase them,†King says. Rather than dip into their own pockets, they came up with a fundraising plan. “We had to be creative and started the Delta’s Chair Club,†explains King. Loyal customers were encouraged to purchase a barstool for $250. Once the stools were delivered, brass plaques with the names of donating
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