Five Advantages Data Gives Independent Restaurants

Because  running an independent restaurant is difficult and there’s a high failure rate, savvy operators are always seeking out ways to ensure their restaurant’s success. Using data as a decision-making tool is becoming a powerful strategy in maintaining a profitable restaurant. The best restaurant technology services provide you with data to help you make better decisions about your operations. Here are five advantages data gives independent restaurants. Choosing the right service could increase your chances of success.

Maximize Your Menu

Building a menu that sells is crucial for a successful restaurant, but it can be tough work. You have to consider design, organization, information, and how people will interact with and read your menu. It’s important to understand that all of these elements must be harmonious to create a menu that sells.

Services such as iPad beverage menus  and smart POS systems, will track menu performance and produce data to help analyze these different elements so you can see where your menu is performing well, and which elements are detracting from the guest experience.

  • Increase Sales for High Margin Items: Every restaurant sells certain items that generate more revenue than others. These items have better margins for the restaurant and it’s the task of management and service staff to persuade guests to order these high performing items. But data can help staff sells these items. By using data generated from digital menus for example, you can track customer interest in these high margin items even if they don’t actually order the item. Tracking these item views gives you insight into the interest and preference of your customers. You can tweak your menu layout, item descriptions, or menu selection, and learn what changes push guests to order your highest performing items.
  • Track Customer Interest by Season: It’s becoming standard procedure to create seasonally rotating menus. This isn’t just for food. Wine, beer, and cocktail lists are all often adjusted to suit the season and offer flavors that match the collective drinking mood. By tracking menu performance over time, you can see how customer preferences change throughout the year and build menus that cater to these preferences.
Converting Dead Inventory into Dollars

Tracking inventory data is necessary to maintain profitable food and liquor cost margins at your restaurant. But this goes beyond just knowing how many bottles you have collecting dust in your liquor room.**  By tracking slow moving inventory, you will learn what items you should no longer carry, and what types of items your liquor room is overloaded with.

  • Tracking Slow Movers: At a beer-focused bar I once managed, we had a hard rule: If we carried a beer and didn’t need to re-order it after three months, we would run that beer as a special and then stop carrying it once we sold through it. By tracking our inventory numbers and purchasing history, we were easily able to track these slow-movers and know when to remove them from our menu. This helped keep our standing inventory cost down and gave us more room to purchase beers we knew would sell.
  • Understanding Price Flexibility: Inventory data will let you know how much flexibility you have with pricing when you’re going to discount an item for promotion or feature. Your goal is to move inventory without significantly hurting your margins. Tracking the dollar value of standing inventory will let you know which items should be a priority to move first, and how aggressively you should promote them.

** You should find a total dollar amount for standing inventory that is reasonable to have on hand at any given moment. Balance this total with your purchasing needs to help establish a profitable liquor cost percentage. By using inventory software to help track your inventory, you can easily analyze these numbers and track your progress in reducing cost.

Run Your Staff Like a General

Proper staffing should result in good customer service. But scheduling-managers must balance good service against labor costs. Tracking how you spend your labor dollars is the only way to make the right adjustments in staffing.

  • Cut Inefficiency, Not Hours: Back-of-house is where the largest concentration of your labor budget will go. Back-of-house staff, from cooks to dishwashers, will typically receive 60 percent of your allotted labor budget. Tracking labor data to learn when and where your staffing inefficiencies occur will greatly improve how you schedule shifts. Look for times of day where you are overstaffed for the amount of work that is necessary. Observe what duties staff are responsible for during times of labor inefficiency in order to learn how you can improve processes to make better use of time and labor. Back-of-house duties such as kitchen prep can easily be tracked, especially if staff is required to keep a log of duties and tasks completed. Even cutting back shifts by an hour or two each day can have a big impact on your month-to-month labor costs.
Make Smart Purchasing Decisions

Tracking your food and beverage purchases is key to running a successful restaurant. Along with labor, F&B are the biggest cost centers in a restaurant. Keep food and beverage cost percentages low and analyze your purchasing habits in order to negotiate better deals with distributors.

  • Get Better Deals with Volume: One of the advantages of tracking your purchases is that you learn how and when you should order each item. For example, if you order two cases each week of your top selling chardonnay by-the-glass, should you continue ordering two cases per week? Or, should you order eight cases at the start of each month? If you know you will sell through those eight cases every four weeks, then it makes more sense to order in bulk. You should be able to leverage this bulk order into case discounts with your distributor.
  • Build a budget that works: Earlier in this post, I mentioned building a purchasing budget to prevent a rising sea of deadstock. Part of building a budget is knowing your liquor cost, which includes your inventory value. The other part is sticking to your budget by making smart purchasing decisions. Establishing a monthly liquor and food budget will keep you in line and allow you more flexibility when something like a special event causes you to order more than your usual total. Track purchasing data to see what your average weekly and monthly orders amount to, and build your budget from there. If you’re sitting on a lot of inventory, you should reduce purchases until you hit cost percentages that will turn a profit at your restaurant.
Gain Jedi-Master Control Over Your Restaurant

When you use data to influence your decision making then the force is strong with you, and you’ve gained control over your restaurant. There are so many moving parts within a restaurant, that it can be difficult to track what is working and what isn’t. It’s especially hard to track if you don’t record the changes as you make them, and analyze the results of those changes.

Streamlining your data using software platforms gives you this control. You have an advantage over your competitors because you’re more tuned in to the daily flow of your business. When you know what to expect from all these moving parts then you’re able to influence them to your restaurant’s benefit.