Today’s tech generates more data than ever before. This is crucial in understanding your business, saving time and growing profit! However, there is so much data available that operators occasionally spend more hours running reports than converting those insights into actions. Information can only be powerful when it is utilized. So, which reports should you prioritize to impact your profits? Keep reading for a guide to the reports I use, and how I use them – all available through Craftable.
The Descending Dollar Report sorts the money you spend in a given period by total dollars, detailing top down where and on what the most money is spent.
It is common that restaurants and hotels end out spending their money in a 90/10 or 80/20 scenario. This means that 80% of their spend accounts from 20% of the items bought, meaning those items deserve the most attention. Typically, your top 10 items will be your center of the plate items that affect the majority of your menu. This seems obvious, but it’s easy to get bogged down in that new special or the produce item that only appears on one dish.
Though not everything can be improved, saving on your top items will make the most significant impact on your cost of goods or spend.
Tip – You’ve narrowed your focus. Now what?
- Pricing – Over the past few years, markets have been very volatile between supply shortages and inflation. Work with your suppliers on efficiencies and options to protect the cost and secure the availability of these top items.
- Yield – Are you buying the best product for the job? There are many options that range from fully prepped items to raw ingredients and every step in between. Think about the labor dollars you are spending along with the waste factor that may be involved in each item. Your suppliers can help guide you to the best choice, so don’t be afraid to ask for their advice.
Sales and Costs Reports
POS Item Sales reveals what items your customers are buying most. Match this to your recipe reports to see your percentage cost and whole dollars, prioritizing a balance of these two aspects. You want your highest sales also yielding the highest dollars and lowest percentages.
Here’s an old adage often forgotten as we focus so much on cost of goods percentages: “You pay your rent in dollars, not percentages.”
Do not be afraid to have a higher cost percentage item on your menu if it drives more dollars to the bottom line. Frequently, we have a limited number of customers, so increasing profits per cover or customer means making more money overall.
Tip – Menu engineering will help impact the data and bottom line.
- Specials or Features – Most chefs like to use their specials to showcase a seasonal offering. While that is an effective strategy, ensuring those items provide maximum profit dollars and low cost percentages allows you to win twice.
Pro Tip – What can you do if there is a market increase on a popular item?
- Add a special in the category at a lower cost. Instead of selling 50 of the now high cost item, you will dilute your sales by splitting customers to the new feature, offsetting the cost of the top seller.
Know what your customers are buying. There is almost no value in keeping an item on the menu that your customers do not want to buy. By rotating out your lowest sellers, you will keep your customers engaged, create more balance in your sales, and better weather fluctuating markets. For example, if you offer 8-10 appetizers, replace your bottom 3 items with fresh options on a regular basis (most likely seasonally to stay ahead of customer tastes.) Your customers will always be excited and you will always be managing your costs with the market.
Sales and Labor Reports
I like to review the Sales by Hour Report with the Labor Spend per Hour Report. I pair this report to my labor spend per hour. Though many think the busiest times have been paired with the most staff, this is frequently not the case.
Revisit your plan regularly to ensure you’re utilizing labor efficiently. Since no one wants extra staff when it’s quiet, your employees will thank you and appreciate the better coverage (and tips!). Plus, these minor adjustments will boost your overall profits.
Tip – Consolidate your efforts.
- How many deliveries do you schedule weekly? Are all of them necessary, or are some simply a luxury? Look for ways to reduce your deliveries and consolidate your prep work. Never harm quality in this effort but be honest about what is a can and what is a must.
Tip – Repurpose labor.
- There are many tasks that often get pushed to the back burner. Try to schedule some of them with your found labor dollars. For example, if you eliminate Wednesday deliveries, your employees still need to earn. Time for projects:
- Deep clean your kitchen. Stay ahead of the health department and make sure you are practicing proper food safety.
- Reorganize your storage. Creating efficiency will improve your inventory counts and make sure you eliminate dead stock.
There is so much data out there, but these are some of the reports that will make an immediate impact on your business. Craftable’s Analytics platform ties all of your data together to give you actionable information, and even consolidates many of the reports mentioned. Maybe that’s why Forbes ranked us as the #1 choice for large bar and restaurant groups. No more spreadsheets or sorting the data. Reach out for a free demo to see how it can help you run a smarter, better business.