Do you want to know how to increase sales at a restaurant? 

Use technology.

Restaurants have a lot of data at their disposal that they don't know how to use. When customers come in for dinner, you have vital information that you can collect, such as:

  • Average total sales price
  • Number of guests per party
  • Popular foods
  • Etc.

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However, the technology used in restaurant businesses has advanced in recent years. Smart restaurant technology can help you boost profit margins so that you're earning more on the dishes that you already sell.

How Do You Increase Profit Margins?

Restaurants can improve their profit margins in multiple ways:

  • Increase restaurant sales
  • Decrease your costs
  • Raise prices

Increasing sales in restaurants really won't improve your profit margins per dish, but it will allow you to generate more overall revenue.

Technology in the restaurant industry opens doors to help you run a leaner business, where you keep expenses low and improve profit margins. The profit margins of your restaurant can be broken down on a per-dish basis.

For example, if you sell Fettucine Alfredo for $8 a plate, your profit margins maybe $2 because:

  • Ingredients cost $1
  • Cook spends $2 to make the meal
  • Waitress costs $1 to serve the customer
  • Utilities to make the dish is another $2

Of course, this is just a simplistic example of how you might calculate profit margins for a particular dish.

Most restaurants have a 10% profit margin for their dishes, with the cost of food being:

  • 30% to cost of goods
  • 30% to labor costs
  • 30% to other costs

Your other costs are everything that you need to pay to keep the operation running. For example, when you make a Fettucine dish, you likely aren't thinking about the additional costs, such as:

  • Renting the building
  • Insurance
  • Electric
  • Internet
  • Etc.

All costs must be considered to better understand the true profit margin of a dish. With all of this information available, it's easy to see how technology may help increase restaurant profit.

Restaurant Industry Technology to Implement to Improve Profit Margins

increase restaurant food delivery sales

Cloud-based Systems to Optimize Staff Workflow

One of the ways to increase profit in a restaurant is by ensuring that your workforce is operating efficiently. There are multiple ways to boost efficiency, but one way that works well is to integrate a cloud-based point-of-sale system.

These systems do a few things:

  1. Store all of your sales data on the cloud to make it easier to analyze
  2. Allow for mobile orders to be made, eliminating the need for staff to go from table to kitchen
  3. Reduce errors

You'll find some point-of-sale systems that also come with other software options. For example, a vendor may also sell scheduling software that you can use to optimize your labor force. The schedules can do everything from using the data in the cloud to analyzing how many waitstaff are necessary based on sales trends.

New restaurant technology allows for a single point of contact between staff and the system.

Staff will have the option of requesting time off or asking to alter shifts in these platforms. Some platforms also allow for shift requests to better fit the needs of staff, while company-wide messages allow for higher engagement among staff and management.

Additionally, the option to fully digitize scheduling will also reduce costs.

Owners can add in their own options to:

  • Monitor overtime
  • Offer full-time and part-time solutions
  • Etc.

And with technology controlling scheduling, you'll spend less time creating more optimal scheduling.

Improve Sales Forecasting

Forecasting is one of the least leveraged ways to improve profit margins, but it is the one option to truly improve your business. The goal is to forecast multiple things:

  • Overall sales
  • Slow periods
  • Busy seasons

When you use current and historical data to create forecasts, you're leveraging a very powerful tool that can help your business. You may find that during a certain quarter, you can increase restaurant food delivery sales by hiring more delivery drivers.

The data may show that in years past, you couldn't meet consumer demand due to a lack of delivery drivers.

Forecasting solutions will help your restaurant in numerous ways, including but not limited to the following:

  • Make smarter decisions, backed by data
  • Determine how sales are flowing over a specific period of time
  • Forecast sales and the necessary personnel to meet demand

Up-to-date data is critical to a business's operations. Every business has challenges that they'll come across, and forecasting can help predict these challenges. You can use forecasting for everything from cash flow to slow revenue periods.

When management knows of these potential issues, they can react accordingly with data-backed decisions.

smart restaurant technology

Optimize Your Menu

Finally, before focusing on how to increase sales in a restaurant, you'll want to use technology to optimize your menu. Your menu is the key to your profit margins. If your prices are too low, they will cause you to have less than 10% profit margins, making it difficult to pay your bills and withstand slow periods.

The technology of today will look at your sales data to help you make sense of your menu.

For example, the technology may:

  • Analyze all meals sold
  • Determine five dishes sold just once
  • Due to low sales for these dishes, a lot of ingredient waste occurred

You'll be able to use technology to pinpoint which items on your menu are popular and which ones barely sell. Reducing the items that don't sell will allow you to stock less inventory, produce less food waste, and increase profitability.

Menu engineering is a tedious process, but through detailed sales analysis, you can learn how each item on your menu increases your profit margins. Also, some solutions will provide information on server performance to learn which servers are bringing in the most sales and why.

Restaurant industry technology is a powerful way to ensure that your eatery operates with high-profit margins. Your restaurant collects a lot of data every day, and if you can find solutions to analyze this data properly, you can reduce waste, improve service and boost your profits.