Balance sheet… School days…

Balance sheet… decoded (kinda)

While we’re in bean counter mode, addressing the least understood financial statement (the balance sheet) seems appropriate. But first let’s set the table: The P&L statement is a record of the profitability of the business over a period such as a month, quarter or even full year. The balance sheet is a snapshot of the value of the business at specific point in time (i.e. 6/31/26).

While they are both documents typically prepared together at the end of a month or year, the P&L tells us how much the business made or lost in that period. While the balance sheet identifies the assets and liabilities of the business and therefore its value at the end of that period.

It’s called a balance sheet because its two sides must be equal. As an example if the assets of the business are $100,000, the total of its liabilities must be the same. One of those liabilities is called owner equity. It’s what the business “owes” its’ owner. If that business owes various vendors and others $60,000, its owner equity will automatically be $40,000. So the total liabilities of $100,000 will “balance’ with the $100,000 value of its assets.

While most of our focus is always going to be on the profit and loss statement, understanding the balance sheet that our accountant and (or QuickBooks) are giving us is important. Because in its absence we really don’t know the actual value of the business we’re building.

Next up: Two hard accounting rules.

School days… And paydays

Back in the day, most school accounts were considered small but still desirable customers. That was primarily true because they weren’t very demanding and delivering results was almost never a problem given the type of ware being used. Those sectioned serving trays and plastic glasses weren’t much of a cleaning challenge and getting your invoices paid was rarely a problem.

On the downside, given the one meal per day schedule that existed back in the day, they were pretty modest buyers of detergents. They opened up for business in early Fall and shut down in the spring. But those days ended in the early 2000’s when many schools began to serve breakfast.

But then Covid altered the playing field for many school systems who began preparing lunches to go – followed by some in less advantaged areas who began to feed their students year round including the summer break.

During the Covid era those accounts who adopted disposables and stayed with them are another matter. But overall the evolution of educational foodservice has resulted in a business category that was once considered “nice to have” into an attractive almost “must have” customer.

Next up: Getting on that bid list.