Not only a good average account is enough
Commonly the administrators de restaurants are evaluated by the average accounts and by the hundreds of costs of the food and workforce they have been able to maintain. These two indicators, alone, do not capture enough information about income or greed that produces compliance with restaurant. Some measures of the income generation potential and the performance of the restaurant.
An administrator can do the great job of maintaining gross profit and still be unproductive. Excessive attention to gross profit can lead to an inclination to improperly focus on decreasing costs. Again, reducing costs is a good measure, but not when this leads to reduced revenue due to dissatisfied customers.
The income control of the Restaurant It can be defined as selling the right seat to the right customer, for the right price and for the right duration.
In relation to price, this becomes a variable that can be more easily managed from the setting of the same for certain times of the day, apply discount policies or prizes to customers; promote a certain offer, among others.
The control of the duration of the dinner is a little more complex since it depends in part on the efficiency of the service cycle and on the client himself, who are the ones who decide whether to delay or not, make on the table, among others.
Develop an income control program
In this sense, the administrator of restaurant of:
- Establish performance benchmark
- Understand the drivers of performance
- Develop an income control strategy
- Apply that strategy
- Control the results of that strategy.
Detailed information should be collected on arrival patterns, meal times, and Income patterns per Available Seat Hours (IngPHAD), as well as entry.
The source of the data may be those recorded by the Point of Sale System, time studies or actual observation, as well as customer surveys. Generally, these data sources are imperfect, especially those selected from the Point of Sale System, because although it can specify consumption and the opening and closing times of the account, they almost never coincide with the patterns of arrival and departure of customers. therefore, relying only on this source will lack important information for the study.
The most advisable thing will be to carry out time studies, they will allow to record the exact arrival and departure times of the client, as well as to obtain in detail the rhythms of the meals.
With regards to information necessary to carry out the complete study and apply the income control strategy in the restaurant, it is important that the records are made as honestly as possible. The period of time chosen must be respected and if by any chance it is not possible to record a specific time or day, it is necessary not to insert false information in them. It will continue with the following days and the missing information will be completed when it actually occurs (that is, the analyzes and observations will be made the day of the following week to evaluate its behavior)
Regarding customer arrivals, it must be taken into account that they do not represent the true unlimited demand. Unlimited demand is understood as the number of customers that a restaurant can serve if its capacity is unlimited.
To study this unlimited demand in the restaurant, you must have a worker to count all the people who arrive at the restaurant and leave without consuming, as well as the reservations that are rejected during the period.
Meal duration. In order to efficiently measure the duration of the meal, it is recommended to design a table containing the days of the week and the time period that will be taken as a sample. In this case, it is convenient to discard all those consumptions that require a service of less than twenty minutes and more than two hours, to guarantee a more reliable data source. Subsequently, the Income per Available Seat Hour (IngPHAD) must be calculated.
Income per available seat (INGPHAD)
The extent to which available seats are occupied is a measure of success that is applied regularly. A busy restaurant is usually a restaurant that generates income. Confidence in seat occupancy as a measure of success suffers from the same situation as confidence in hotel occupancy because high use does not necessarily indicate high income. A restaurant can operate at 90% of its capacity and not make money if the menu items are sold at very low prices.
The IngPHAD indicates the frequency at which income is generated and changes the exchanges between the average account and the use of the facility. If the percent occupancy increases even as the average count decreases, for example, a restaurant can still achieve the same IngPHAD. Conversely, if a restaurant can increase the average bill, it can maintain a similar IngPHAD with slightly less utilization than the facility.
The easiest way to calculate the IngPHAD is to divide the income (or profit) by the desired time period (that is, part of the day, day, month) by the number of available seating hours during that interval.
In any case, when choosing periods of time that include days, weeks, months or others that are considered, they should be included in the calculation. For example, if you want to evaluate a period of 7 days, this time should be included in the denominator, that is, you would multiply the seating capacity x (service time x the number of days)
The IngPHAD is closely related to the number of changes and the length of the meal, or the service cycle. As the amount of change increases and the duration of the meal decreases, the IngPHAD grows. Just a minute decrease in meal duration in a period of high demand can lead to an increase of 1.5 to 2 percent.
Reduced meal times can be achieved by changing the service process, changing staff levels, or altering the menu. The first few minutes of reduction are somewhat difficult or expensive to achieve, by speeding up the pace of greeting, sitting, and settling the account, sometimes the customer may feel that they want more than their consumption to go away. But deeper reductions may require a significant investment - for example, adding equipment to the kitchen or more employees.
An analysis of income on investment that considers the effects of changes in the service cycle on IngPHAD, can help operators decide if a future investment is worth it. In developing their plans, managers should remember that customer preferences and expectations limit the minimum feasible dinner duration, and will establish an acceptable minimum assumption for IngPHAD.
Once the operators have mastered their IngPHAD patterns, they can develop strategies to face periods of highs and lows. During low periods, managers can either try to attract more customers and increase usage, or rely on the recommended sale to increase the average account.
In those periods of high, operators should analyze whether to increase prices or reduce the duration of the meal, so that the restaurant can increase its frequency of changing tables.
IngPHAD can be used at different levels of analysis and for different purposes. At the individual restaurant level managers can choose to compile the hourly or quarterly hourly IngPHAD figures to develop an income control strategy best suited to their restaurant. This instrument can also be used to evaluate the efficiency of the employees and in the service operation.
As an instrument, it allows to compare the results obtained by the installation with respect to those that operate in the environment and the sector's own competition. The use of the comparison will allow the setting of goals and own actions regarding the increase in capacity, the reduction of service cycles, the prices offered, among others.
For this, the restaurant manager needs to know what the competitor's average account is, as well as its maximum seating capacity, in order to establish the comparison patterns, which can be from the theoretical comparison the performance of IngPHAD compared to others. restaurants and the competitive compliance of IngPHAD in relation to the environment.
Although competitor information is generally not available, you can compile this information and perform the analysis.
- Average account is the average income value of the restaurant that is analyzed.
- IngPHAD is the calculation made from the data obtained from the restaurant being compared.
- Account compliance is the division of the average restaurant account over the group average. restaurants which are compared
- IngPHAD compliance is the same procedure as above but for that indicator.
Benefits of restaurant income control
Apply strategies that allow to measure the real performance of the restaurant, based on its occupation, average count and duration of meals, is an important source to identify the problems that failures generate and act on them. When a study of this type is carried out, issues such as the skills of the personnel in terms of service, speed, skill, sales capacity, manipulation of the means for provision, among others, usually arise. as well as being an important source of information to determine the supply, technological or expansion needs for the organization.