Did you know that your POS Data & Analytics can help boost your Profits?
Published May 21, 2021
It’s more than just a register. The data your point-of-sale captures can play a key role in how your restaurant makes money—but only if you know how to use it.
Unfortunately, not every restaurateur knows how to make the most of the information collected by their POS system, and if you can’t properly explore your restaurant’s data, you might be making critical business decisions based on anecdotal-half facts and faulty information.
Here are 4 tips on leveraging your restaurant’s data to optimize price points, appropriately schedule staff and increase revenues.
Think beyond cutting costs
Too much emphasis on minimizing expenses can divert your attention away from the bigger picture, because the bottom line becomes more important than the guest’s experience. Focus on the data that can show you how to drive more sales and increase guest frequency instead of finding ways to minimize expenses.
Compare apples to apples
A common mistake among restaurant owners is focusing on the wrong information in their POS data, which can lead you to make inaccurate conclusions.
For example, you may measure your restaurant employees on their sales divided by the number of hours worked, but the number of guests and what they’re buying can vary greatly depending on the day and time they’re working. Instead, normalize your data to the specific day and hour worked, not the overall number of hours.
Find the meaning behind the math
If you want data to make a real difference in your restaurant, don’t focus solely on the math. You’ll get far more applicable insights by trying to decipher the trends that are driving the numbers.
Take per-person average (PPA) as an example. Knowing your PPA is $18 doesn’t tell you much, but digging deeper into the data could reveal that guests with a $14 PPA have the optimal frequency. If you discover that most of your new customers are actually spending $17, that means they’re less likely to become frequent guests.
Highlighting popular menu items is another example. Your signature dish may be the top-seller on your menu, but if it’s not the dish that’s bringing customers back for repeat visits, it may not really be your “most popular” item. Look into what returning customers are ordering and if there’s a particular dish they order each time.
Experiment with your data, not your guests
One of the most expensive mistakes restaurants make is experimenting with their guests. If your experiment goes poorly, the guest is less likely to return and you’ve missed out on gaining a loyal customer. To avoid costly mistakes, use your restaurant data to simulate changes, such as a price increase, before presenting them to live customers.
Say your food cost for beef goes up, for example. Reviewing your data from past menu adjustments may reveal that an increase in the price of a chicken sandwich would create less of an impact on sales than changing the price of a hamburger. So you could offset the rising cost of beef by having customers who usually order a chicken dish foot the bill.
The right insights, and how you use them, can make all the difference
Your POS data can be a mighty tool when you take the information data it provides and use it the right way. Using data to help guide how you list items on your menu, make informed, effective pricing and staffing decisions and cut costs that can boost your profit margin can really add up!
