For many restaurant owners and operators, turning to data to increase profits and reduce costs can feel slightly overwhelming. One of the problems is the sheer amount of data restaurants produce. Where do you start, and how do you extract meaningful insights?
The first step is generating accurate reports. Fortunately, with today’s POS integration and tech companies making Application Programming Interfaces (APIs), data is becoming more accessible and easier to understand. A restaurant API lets you connect to restaurant databases or applications and interact with the information.
The important aspect for restaurants is determining which information is essential among the multiple sets of data. Let’s explore the data that can significantly impact your operations and performance.
Essential Restaurant Analytics
Data analytics reveals your restaurant’s current status and areas that need improvement. It shows the path to greater profitability, improved product quality, and a better customer experience.
Restaurant data allows you to identify trends, such as guest checks, revenue per shift, and the employees that are promoting and upselling. Much of this data is contained within your Point-of-Sale (POS) system.
Data and Your Menu
Pull reports that enable you to evaluate what menu items are performing well and the profits derived from those items. Aim to have several popular and highly profitable offerings on your menu. Then, promote these items via menu engineering and training staff to upsell.
If data reveals popular items are providing little profit, it’s time to dig into the numbers. Are your menu prices not keeping up with the rising food costs? Or, have your portions drifted away from your original recipes? At EMERGING, our F&B Insights division helps operators compare their menu pricing with competitors in their area and across the nation. The world’s largest menu database ensures you’re not leaving money on the table or over-pricing for your market.
Other aspects of your menu that require troubleshooting include items that offer good profits but aren’t selling. These items are either overpriced for your area or require changes to the recipe. Those that neither sell nor offer much in the way of profits many need to be removed.
Keeping an eye on trends can offer some of the best information for streamlining operations and enhancing productivity. One of these trends is derived from identifying peak revenue times and table turnovers. Are your peak revenue times consistent or do they vary? Are table turnovers faster or slower with specific servers?
If clear trends develop over a period, it may be time to check with floor managers to see if the numbers coincide with what they’re witnessing. If so, you can provide additional training for some servers and a bonus for those adding to your bottom line.
Analyzing historical data can also help you optimize your workforce by scheduling appropriately during peak seasons or when community events and holidays generally cause busier shifts. Comparatively, recognizing off-peak times may warrant running specials, considering entertainment, and increasing social media advertising to attract diners.
In addition to menu entrees, specials may pertain to happy hour drinks and appetizers. In this department, your suppliers can be your best allies, helping you develop alternatives that may be hot in other markets or with competitors. Your increase in sales, after all, correlates with their increased profits.
Understanding data analytics is vital when considering expanding your operations. This data includes current customer demographics and knowing potential neighborhood demographics, including what draws people to certain areas, where they spend their money, and your potential competitors. How far will your guests travel, and how can you ensure a consistent guest experience across all units?
At Acutely, a division of EMERGING, our data scientists use data analytics and client-specific POS data to obtain actionable insights. These insights include customer analysis and what makes your current location successful. Then, we use this information to help you determine your next location and how many units will maximize your sales.
At EMERGING, our team is made up of real estate experts. Not only do we identify the most profitable locations, but we also negotiate with developers and landlords on your behalf. We support your growth through business strategies in the supply chain, finance, labor, real estate, finance, and data science, providing unrivaled value from one platform. To learn more about partnering with our expert team or to schedule a consultation, contact EMERGING today.
Where do restaurants get their data from?
Restaurants find enormous sets of data in their POS system, inventory software, and guest management systems. In addition, unstructured data comes from social media, customer profiles, loyalty programs, and traffic patterns.
How do restaurants gather customer data?
Restaurants obtain customer data from online ordering platforms, third-party apps, loyalty programs, direct requests, and more. This data helps determine VIP and core customers, or those who frequent your establishment the most and offer the most significant difference in your profits.