MRM EXCLUSIVE: Five Types of Data Needed to Run Your Restaurant to Its Maximum Potential
3 Min Read By Paul Goetz
Competition in the restaurant industry is stiff, and it takes data to keep a lid on costs while getting more out of every hour, meal, and cover. There are 60,000 restaurants opening every year while 50,000 are closing, and it all comes down to a mix of staff performance and guest tastes.
To survive in this climate, you’ll need to gather data about what drives repeat purchases, faster turn times and high tickets. This data needs to be made easily available, understandable, and actionable for managers to get the most out of every shift.
In terms of operations, there are five key data sets every restaurant should understand:
- Historical sales trends: You should report trends compared to previous time periods — day, week, month, quarter, etc. — to track realistic growth.
- New vs. repeat guest breakdowns: It’s important to know whether you can drive in customers and raise their lifetime value as high as possible.
- Server performance metrics: Rating servers relative to one another, as well as the average broken down by category, determines where your servers stack up: whether they’re growing, who needs coaching, and who’s mastering what.
- Menu item retention metrics: Understanding this lets you see which menu items are bringing customers back and which aren’t.
- Real-time labor costs: As a percentage of gross sales, are labor costs prohibitive to making profit margins? Real-time statistics allow you to send home staff members on the fly during slow nights without leaving you vulnerable to a rush.
Gathering and Tracking Data
This type of data used to be impossible for restaurants to gather, but today it’s built in to modern point-of-sale platforms and business analytics. While POS reporting is great for tracking sales by server and till, other platforms extend this reach to provide a holistic approach to gathering data. Using this data answers five key questions:
- Am I growing my business? By making historical data available to managers — and even scheduling a weekly call to review them — trends emerge that help you understand whether you’re growing or shrinking the business. This isn’t as easy as looking out to see whether the dining room is full or empty, as some customers spend more than others.
- Am I bringing in new customers or driving lifetime value from regulars? It’s important to understand who your customers are and what they’re spending their money on. Using loyalty programs is a great way to gather customer data, and once they’re in the system, you’ll know their habits. If you’re not bringing in enough business (new or repeat), it’s time to reevaluate the menu, host promotions, and train servers on recommending high-retention items.
- How can I increase all-commodity value? These analytics help you understand who to coach on what areas in order to raise ACV. This also helps servers earn more tips, which incentivizes them to stay with the company longer and grow professionally. With a seasoned staff, you’ll find the restaurant runs much more efficiently.
- How do I better understand why my customers come in? POS reports often have false positives, like showing top-selling items that aren’t actually the reason people are coming in. It may be that everyone’s ordering your restaurant’s “world famous” apple pie because it’s labeled as such, but no one really likes it, and, as it turns out, people are actually returning for the milkshake. Reviewing data analytics as a team can identify these issues.
- Am I overstaffed? Understanding both historic and real-time labor costs can help you discern where you can save money, which directly affects margins. Were you busy because of last weekend’s Cinco de Mayo celebration? There’s no need to ramp up staff this weekend if you understand the trends. Also, if you overstaffed for the holiday, you’ll know and can act to immediately remedy the situation.
It’s not enough to just gather and analyze data now that every restaurant has access to the same tools. Getting the management team on the same page is key to success in today’s environment. Running these reports and disseminating the information to management in a way everyone understands will bring your restaurant into the next generation.