Justin Cohen is partner and VP of operations for Riot Hospitality. This article does not necessarily reflect the opinions of the editors or management of Restaurant Hospitality.
Measuring performance is critical for your restaurant. A coach measures a team’s efficiency with wins, losses and public perception, and restaurant managers should think the same way.
Many restaurant failures could be saved by implementing some basic but necessary forms of measurement. Successful restaurants that maximize their profit have one standout approach: They use multiple levels of measurement for real-time feedback on the health of their business.
Use these five best practices to help you identify your restaurant's needs, create a more accountable culture and generate sustainable cash flow.
1. Dine at your restaurant. You would think this is obvious, but it’s very uncommon. Every time you dine at your restaurant, you gain a new perspective. Each seat views the business from a unique angle. You may have a wobbly table or notice a light that is out. You can also evaluate the service as a guest. You will quickly see strengths and deficiencies of the service staff. What is their sense of urgency? How strong is their menu knowledge? Is the host attentive and enthusiastic? Are pre-busses and refills consistent with training standards? Once you have identified weaknesses, you can plan to bridge the gap.
As for the food, I have dined in my restaurants hundreds of times and have had very few perfect experiences. If you feel there are no growth opportunities with food, you are not looking hard enough. Eating as a guest gives you incredible coaching opportunities for recipe adherence, food production and technique, and helps find training and developmental holes you can work with.
2. Use secret shoppers. Secret shoppers are an important measurement for the sustainability of a restaurant, providing a quantitative valuation of your team's performance. These professionals analyze everything from the façade, to the bathrooms, to theft behind the bar and the server upselling dessert. Your staff will always act differently when you are not around, so these companies are your eyes and ears. All of the successful companies I have worked with have utilized secret shoppers. Creating excitement around these results with your team is important. I have rewarded teams when I get great results, and I have disciplined weak service. When you follow through with the results, this tool can enhance the service culture.
3. Work with financial software. This is an inexpensive and essential tool for measuring your company's financials. Software programs can allow you to identify COGs, labor management, same-store sales, comps and many other measurements in real time. You can use this software for inventory control, prep and ordering pars, which help you decrease waste.
Although a monthly P&L is an important measurement, it analyzes the past. P&Ls should be a report card, but you shouldn't measure business health with just a P&L. Use the software to understand your business in real time so you and your team can make operational changes on the fly. Create an educated culture around these tools with your team, focused on sales but able to analyze inefficiencies. In my company, all managers are trained on software so they can understand the “why” behind the numbers and make operational decisions based on analytics. I don’t manage to the bottom line; I lead through information. This has added to millions to my company’s profit.
4. Pay attention to reviews. Online reviews have an incredible influence on public perception. When dealing with reviews, you first need to communicate directly with the guest who has reviewed your business. Quick public responses to reviews stop a guest from ranting about your business and show them you value their input. It's also essential to thank those who leave positive reviews, providing positive reinforcement and making them more likely to dine with you again. Secondly, take the feedback to your team. If you dismiss reviews, so will your team.
5. Talk to your guests and employees. These are incredible barometers of your business. Guests will tell you if they like the food directly and indirectly. If a guest says everything was good, ask them what you can do to make it great, and they will tell you. Just because they aren’t complaining doesn’t mean they don’t have issues. Watch their interactions to see if they are enjoying themselves. Nonverbal interaction offers much information.
Servers and bartenders are filled with information on what people say about their experience. They know which items consistently get returned. Ask them how to make the training program more effective. Find out how morale is and how you can impact it. Give them a voice. Empower them as partners and they will act accordingly.
Justin Cohen is partner and VP of operations for Riot Hospitality, a $50 million, multi-concept hospitality company. Cohen has worked in every single vertical within the restaurant business.