How to Drive Restaurant Profit Growth with a POS System
“Quick Summary” When it comes to restaurant operations management, if you have a visual on only the general performance and not on the factors that drive the performance, you will be missing out on sales growth opportunities. With advance reporting and operations management capabilities, your POS system serves as the primary resource for the success of your business.
Let the POS System Drive the Bottom Line
One of the most important opportunities that you could miss out on is not being able to serve a menu item that the customer craves. It’s a tough call to manage the adequate inventory replenishment meeting the forecasted sales without over stocking. Over stocking can drive inventory waste though under stocking and not being able to sell the menu item at the retail price will cause a greater profit reduction. Therefore, as necessary, it’s a no-brainer to reasonably overstock and ensure menu items are available to provide the experience that customers demand.
So you’re all stocked up, and it’s rush hour, but the customers are waiting to be served whether in line or at their table. Don’t let under staffing diminish the customer experience and sales opportunity. Simple sales reporting by hour and day will let you know the exact amount of staff that you will need to support the operations. Again, as necessary, appropriately over staffing can have a greater impact on profitability with being able to serve customers timely than to avoid the relatively minor staffing expense, which could reduce the greater profit potential.
Now comes the part where you go from being an operations manager to a strategic marketer. If everything is looking great, inventory is stocked and employees are on prime time shifts, then you can utilize historical sales data to understand when to run marketing campaigns. Have slow days in the week? Great, you can use these days to run promotions and events that will not only drive customers, but further brand your restaurant. Let’s face it, restaurants are more than just a place to grab food, it’s rather a place to be entertained while eating great food. Thanks to the digital age we live in, you can utilize integrated loyalty programs to remarket to your existing customers.
POS System as a Loss Prevention Manager
Most brick-and-mortar businesses that have a large scale operation and high transactional volume have theft and loss to a certain degree that can go unnoticed to impacting the business tremendously.
First things first, have an adequate inventory control process in place so that you can identify where the loss is occurring, and that could be inventory waste, returns, employee theft and customer theft. In a restaurant environment where food is being served, the chance of customer theft is not likely as anything that is not served to them is not reachable by them. With an inventory control process in place, you can identify where the most loss is occurring, whether that may be food that was over prepared and had to be thrown out, customer orders not being prepared correctly or employees taking as they wish.
Once you have created a process to account for current and new inventory, you can allocate loss to its appropriate category. You can utilize a scale to measure inventory and understand what inventory level each product should be in relation to the daily sales. You should also take it a step further and review error corrects and voided transactions, as in both cases cash may be taken or unauthorized food given. If inventory loss does not attribute to waste nor returns, then obviously it’s internal employee theft, assuming that new inventory are accounted for within the inventory control process.
The takeaway here is that if you have upgraded from a cash register to POS system, your POS system is of no great use to you if you are not optimizing the profit potential through real time insights. The possibilities are endless, as long as your POS system is not limiting in the actionable information that your business thrives on. Learn how the Ovvi Restaurant POS system can be an invaluable extension of your restaurant management practices.