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How to set short-term and long-term goals for your restaurant

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1 How to set short-term and long-term goals for your restaurant1.1 Here are 6 examples of long-term and short-term goals for restaurants1.1.1 1. Restaurant sales to increase monthly1.1.1.1 Restaurant Goal: To increase net sales by 5% month-over-month1.1.2 2. Net restaurant sales increase […]

How to set short-term and long-term goals for your restaurant

How many hours per week do restaurant managers and owners spend updating Excel sheets and exporting Excel spreadsheets to measure the success of their restaurant?Once you have the numbers and determined your key performance indicators (also known as KPIs), do you then set data-driven restaurant goals for the year, month and day? Do you simply look at the numbers and decide that my restaurant is making money so it must be doing something right?

Restaurant numbers can tell almost any story that you wish. You need to establish short-term and long term goals in order to tell the right tale and make yourself a success. This will allow you to dive into the good and the bad of your restaurant sales as well as your menu analytics.

The right restaurant analytics platform allows you to drill down to the cheese option for your nachos in order to quickly determine which areas of your business are boosting profits. Instead of spending hours tinkering with pivot tables and charts to find the same answer, instead spend time analyzing them.

It can be useful to concentrate on what you can manage, given the many variables and uncontrollable issues in the restaurant industry. These are six short-term and longer-term goals that you can set for your restaurant to increase restaurant KPIs .

Here are 6 examples of long-term and short-term goals for restaurants

1. Restaurant sales to increase monthly

Your most important metric is net restaurant sales. This is the basis for all your restaurant analytics. This number is a key factor in the success of your restaurant and, if applicable, your investors.

Net sales is gross sales minus discounts. It can be difficult to calculate each day if you have to dig through receipts from yesterday. You can easily access this number anywhere, at any time via your restaurant analytics platform. This allows you to focus more on growing those numbers than on finding them.

Based on historical data about your restaurant, your location and your knowledge of seasonality, you can set monthly goals to increase your net restaurant sales. This guide will help you analyze your restaurant and improve its sales numbers.

Restaurant Goal: To increase net sales by 5% month-over-month

2. Net restaurant sales increase daily

 

Sometimes, it can be helpful to zoom in and view a daily snapshot showing your net restaurant sales. This can help you identify which promotions are working well and where you can improve sales.

 

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Let’s take one example: On December 14-15, a restaurant held a weekend promotion that brought in most of the sales for the month. As you can see from the graph, the result was impressive. They may have had an average net sales per-day of $3,000 without the promotion. But now, that number has risen to $5,000.

This restaurant saw an increase in sales thanks to the promotion. They might consider adding it to their repertoire to run once per quarter.

3. Increase new revenue streams

According the 2019 Restaurant Success Report 77% of diners rated loyalty program as “Somewhat or Very Important” for their guest experience. 59% also rated gift cards as “Somewhat or Very Important” to their guest experience.

The graph shows that 70 transactions were made via gift cards in the restaurant’s case, which represents 6.4% of total transactions. However, those gift cards brought in only 4% of their total sales.

You could organize a competition among your servers to see who can make the most sales of gift cards in a given time frame. The goal is to increase the number of transactions and sales of gift cards. You can also remind your customers and supporters via social media that gift cards are available.

Restaurant Objective: To increase new revenue streams to 15% of total transactions

4. Increase your top-selling products

Menu engineering is a method to determine the future price of a restaurant’s menu. It uses data from restaurants to make design decisions and to assess current pricing. You will know which menu items are most popular , and most profitable.

The above analytics dashboard shows you which menu items, menu groups and modifiers are the most popular. Once you have identified which menu items are “stars”, you can focus on getting them in front more people.

You don’t need an analytics dashboard to do menu engineering. Instead, look into the food cost percentage, contribution margin, popularity of items, menu design, and psychology.

Is it possible to get a 10 oz. cut for less? To improve your food costs percentage, you might consider buying sirloin steak. You could change the menu design so that a lower-cost item, but more profitable, is moved to a higher spot on your menu. This would allow you to compete with the calamari which may be expensive to produce. These and many other questions can be answered by menu engineering. Take the free menu engineering course to learn how to use data to create the best menu possible for your restaurant.

Restaurant Goal – Increase menu item net amounts by 20% using menu engineering

5. Try new menu items

A breakdown of your product mix, such as the one shown above, will allow you to see how each new item compares against the rest. You can also get ideas for menu items based upon popular modifiers that guests order. Your customers can often be your best source of ideas for new recipes, even though they may not realize it.

Calculate the average monthly net sales for each menu item to determine the success of a menu item. Next, add a new menu item to your menu every month. Check to see if your monthly net sales of the new item outperform the average. You might keep it in your menu if it does.

Restaurant Objective: To have new menu items net sales exceeding the average monthly menu item net Sales

6. Charges for testing

A new service model is being tried out by some restaurants, The New Steps of Service. This new way of operating uses Toast Mobile Order and Pay along with POS handhelds as well as traditional touchpoints. Some restaurants have eliminated tipping altogether and introduced a service fee.

HOUSEpitality Restaurant group introduced a service fee to replace tips. This resulted in significant increases in staff salaries in both the front-and back-of-house. They now call themselves floor captains and cooks and make upwards of $20 per hour. Bussers, dishwashers and food runners earn $15 to $17. Kevin Healy, of HOUSEpitality, said that “the beautiful thing about it is people are leaving additional tips aswell.”

Before making any changes to the compensation structure, make sure you check with your local labor laws and consult an accountant or lawyer.

Restaurant Objective: To increase staff pay and retain employees.

Many restaurants start to think about long-term goals. It’s important not to get carried away, and to keep your eyes on the short-term goals and what you can do to increase sales. You can focus on one goal at the time and then move on to the next.

source https://pos.toasttab.com/blog/long-term-goals-for-a-restaurant