A recession is looming. CEO confidence is at a post-pandemic low. Are your restaurants prepared?
While the restaurant industry has weathered many recessions, some companies are looking to merely survive, while others have thrived. Here are 3 lessons we can take into the next one and how Expo can help you grow in turbulent times:
1. Cut Costs with Data Automation
Automation in restaurants usually conjures images of robotic dishwashers and self-serve kiosks. But automation doesn’t need to be that complex or that expensive. Automation really refers to any replacement of human labor on redundant and repetitive tasks.
Think about the ways that your restaurants collect, analyze, and communicate data today. If you are still using spreadsheets and emailing reports every other day, then you’re wasting thousands of hours per year in human capital that could be allocated in other ways. When adding up all the hours between Finance, Execs, Area Managers and GMs - many restaurant companies find they are spending $500k-$1M per year in resources on data management.
Do the math yourself - multiply the number of hours per week each employee spends on gathering, reporting, analyzing, and coming up with action plans, then multiply by their hourly rates, you’ll be surprised.
Expo automates the collection, analysis and delivers the data in a simple way that your teams will use to take action. Data Automation will not only save you $500k+ per year in reporting overhead, but increase engagement and happiness - because no one likes gathering data.
2. Laser Focus on Performance Management
In good times, performance management in restaurants is measured by a few simple factors, like Sales, Prime Costs, Comps and Gross Margins. However, in a recessionary environment, restaurant scorecards should also indicate where they stand in capturing more market share, taking out bad costs, and closing out the needs-offer gap for their customers. More importantly, navigating recessionary times means your entire organization needs to be laser focused and know precisely what’s important; only gold standard execution will ensure your company thrives in this downturn.
Ask yourself: Is your entire organization aligned on what matters?
Is your data still siloed amongst different departments? Are your GMs using data from all of your systems to make decisions or are you still relying on the canned reports from the POS?
Expo aggregates all your data sources and enables you to customize Performance Scorecards for your business so you can measure execution and ensure everyone is on the same page.
3. Gain Market Share by closing the Needs-Offer Gap
In a recession, consumers cut back spending, and will likely only spend money at places they already enjoy. These are comprised of two groups: your loyal customers and your “switchers”- customers who frequent multiple brands. However, customers who are loyal to a different brand are unlikely to buy from you. You need to recognize the difference, and invest your resources into getting more spend out of your loyal customers, while increasing the chances of “switchers” coming to you.
After the Great Recession, few companies understood this like Starbucks, and came out thriving and taking market share. In 2008, Starbucks cut nearly $600 million in costs, but also closed down 7000 stores for a 1 day training session so they could deliver on what their customers wanted, They closed the Needs-Offer Gap which simply means: Getting your best customers to spend a little more at your stores by understanding what they need and what you currently offer.
Do your management team and operators understand how to close this gap? Do your GMs have this data at their fingertips so they can easily coach and train their teams?
Expo puts all Guest Reviews and Employee Level Performance metrics in the hands of your GMs, so they can manage, schedule, and train their teams to deliver great guest experiences everyday enabling you to capture market share.