Opening your own hospitality venue is an exciting, albeit challenging, time that’s filled with endless opportunities to streamline your operations and facilitate growth. When it comes to adaptation, data is king, and many hospitality owners use their analytics to boost efficiency and maximise their profits.
Taking the time to analyse your venue’s data and analytics will empower you to optimise all areas of your business, from staff performance to wastage and best selling menu items. While most hospitality owners have a good understanding of what’s going on in their business, having the data to back up your assumptions provides a much-needed layer of certainty. This way, you’re always confident that your decision is backed by data.
Point of Sale Reports
Point of sale (POS) platforms, like Lightspeed, connect all touch-points of your business (from inventory to staff scheduling) in one centralised system. This hyper-connectivity means POS platforms contain a wealth of information on your business and are an invaluable source of data for business owners looking to improve their performance.
8 Reports for hospitality owners
- Sales analysis: best sellers and underachievers
- High-profit menu items
- Average order value (AOV)
- Popular times and days
- Inventory
- Wastage
- Staff scheduling
- Employee performance
1. Sales analysis: best sellers and underachievers
Understanding which products are your best sellers is an important step in optimising your margins to boost profitability. Running weekly and monthly product performance reports will enable you to see which of your menu items consistently sell, time and again. From this data, you can pinpoint if there’s any room for improvements and detect trends over time.
While it’s essential to understand which items on your menu sell well, it’s also crucial to determine which items are underperforming. You might find that some of your menu items just don’t sell. If the declines are consistent, it might be attributed to seasonality or maybe the product has run its course. If this is the case, consider removing it entirely from your menu and replacing it with a new dish.
2. High-profit menu items
You and your chefs have thoughtfully constructed your menu, but that doesn’t always translate to it being as optimised as it can be. Use your point of sale reports to understand which of your menu items generate the most profit and which items need to be optimised.
With clear reports on margins and your customers’ buying behaviour, you can distinctly categorise your menu into high-profit dishes that are not performing, and dishes with lower margins that are popular with customers.
Having consistent access to that data, allows you to optimise your menu by creating specials, promotions, and recipe adjustments to uniformly increase your margins.
Try our Food Cost Calculator for free
Lightspeed’s food cost calculator breaks down your menu per dish. Punch in your desired margin, and we’ll do the rest.
3. Average order value (AOV)
AOV tracks the average dollar amount spent each time a customer places an order at your venue. It is a key metric that all hospitality businesses should measure to understand how their business is performing over certain periods.
If you notice your AOV is decreasing week on week then you can take steps to prevent this dipping further. For example, upselling is a great way to inject more cash into your bottom line while also boosting your AOV.
4. Popular times and days
Most business owners have a good idea of their venues best and worst-performing days and which times of the day draw in the most sales. However, it’s crucial to back up your assumptions with data; that way, you can track trends over time and highlight when a typical busy night might be losing traction.
By analysing your venue’s sales data by the hour, day, week and month, it will be easy to predict busy periods. You can also use this data to highlight which of your menu items are most popular during peak times and adjust your purchase orders accordingly so you’re always well-stocked.
Armed with this information, you can optimise workflows and maximise sales during peak times. For example:
- Schedule staff who are the best at turning tables and great at upselling
- Roster more staff during peak periods to ensure a great customer experience
- Increase order volume for popular menu items so you don’t sell out and disappoint customers
- Dedicate more time to kitchen prep to reduce wait times
On the other hand, if you’ve identified notoriously slow days, you can start building a plan to boost sales during these times. For example:
- Host regular events such as live music or wine tasting
- Create a special offer, like buy one get on free, to entice people through your doors
5. Inventory
With 40% of food bought for inventory not making it past the back of house, inefficient inventory management is costing hospitality businesses thousands of dollars a year. To help venues streamline their inventory, POS platforms, like Lightspeed, manage stock, suppliers and costs all in one place, providing owners with a wealth of insights into their stock and purchasing habits.
Inventory reports allow you to:
- Maximise margins by breaking down dishes per ingredient, so you can compare revenue against cost price and profit
- See stock levels in real-time, so you never over or under order
- Track fixed and variable ingredient costs
- Track supplier costs and quality
Taking the time to analyse your inventory reports allows you to operate more efficiently before the customer even purchases food. It also creates a better process to manage what you’ve bought versus what you’ve sold, reducing your expenses and increasing profitability.
6. Wastage
Food waste is one of the hospitality industry’s greatest pain points, and it costs the Australian economy $20 billion a year. Not only does food waste have a detrimental impact on the environment, but it also equates to wasted money for business owners.
Hospitality businesses need to regularly record and monitor wastage in their POS to prevent future waste and save precious dollars in the process.
Lightspeed POS, lets you know the exact cost of your wastage and take action to minimise future waste. How?
- Easily record food waste, who entered it and why
- Inventory is automatically updated when wastage is recorded
- Minimise waste by running reports to spot trends over time
When you know what you’ve wasted, you can assign costs to those losses and understand the impact. When you know why you’ve wasted, you can take measures to prevent it from happening again – saving you money in the long run.
7. Staff scheduling
33% of a hospitality business’ outgoings is spent on labour, which is a considerable cost for any business. Inefficient scheduling can impact your profits and customer experience. Roster too many people, and you risk wasting money on labour that’s not needed. Schedule too few, and your staff might be overwhelmed, leading to mistakes and a poor customer experience.
Integrating your POS platform with a team management system like Deputy or Tanda is the best way to optimise your staff scheduling. By combining the data from both systems, you’ll be able to access detailed insights to understand:
- Which days and times are the busiest, so you know exactly how many staff members to roster
- Which staff members generate the highest AOV and schedule them on busy nights to maximise your sales
- When certain members of staff should start and end their shifts, to create staggered rosters, so you’re never over or understaffed
- How much money you should allocate for wages during busy periods like public holidays
8. Employee performance
Your staff are the face of your business so it’s important to use your data to understand who your top and bottom performers are. Use your point of sale reports to measure the following:
- Who turns tables the quickest
- Who gets the highest average transaction value (ATV) per table
- Who generates the most tips
- Who is the best at upselling
- Who wastes the most food
- Who is the quickest at kitchen prep
Employee performance reports will give you a clear picture of your team’s individual strengths and weaknesses. This information can then be used to set KPIs, upskill employees, cross-train and reward staff members. You could even consider promoting high achievers into a supervisory role to nurture their skills.
Lightspeed Insights: drive growth with data and reporting
When it comes to making decisions, data is king and having a solid source of information is invaluable. With Lightspeed Insights, hospitality owners can drill down into their numbers as all business touch-points are combined to create digestible, downloadable reports. These reports give owners both an overarching and granular view of their business performance – helping to spot trends over time and pinpoint areas for improvement.
As a new business owner, your data and analytics will be the foundation of success for growing your venue. Taking the time to analyse each area of your business will enable you to make informed decisions (rather than educated guesses), implement changes based on your insights and measure the success of your initiatives.
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