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HomeBetter Restaurant OperationsThe Only Way to Sustainably Grow Your Restaurant’s Sales is through Better Operations

The Only Way to Sustainably Grow Your Restaurant’s Sales is through Better Operations

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It’s time to return to basics and focus on what works for long-term sustainable sales growth, which is better operations.  Nobody wants to hear better operations because they are either delusional about the current state of their operations, or they don’t want to put in the hard work and discipline of focusing on running better operations.

Nothing that you will do, no new system (delivery or take out), no new technology like a better POS or better website, is going to do more for your business than having delicious food, in clean well-managed restaurants, with great customer service.  NOTHING!!!!  If you didn’t want to be an operator and focus on being excellent, then this isn’t the business for you.

I was the dining room floor manager of a busy restaurant in 2001 we added $80,000 a week to revenue over a ten month period.  That is right 80K a week, not a month, and we didn’t spend an extra dollar in marketing nor did we add any new sales channel.  You know how we did it:

  • Moved the servers from 5 tables to 4 table stations- which all the servers hated at first.
  • We started using checklists to ensure that we were ready in the FOH for each shift, this included pre-shift meetings with the team.
  • We actively managed the dining room each shift focusing on service and turning tables.

You see we had latent demand that before we focused on operations we weren’t getting because our service was slow and quite frankly not that good.  When we made the sections smaller, brought in more servers, invested in training those servers on the menu, customer service, upselling, etc.  They had more time to do a better job servicing guests.  When we focused each shift on making sure that the restaurant and the team were ready, it was easier to wow guests.  I’m not telling you anything that you don’t already know; better operations, focusing on the little things, and providing an excellent experience is your best marketing initiative and the quickest way to grow sales.

Here is some information that provides more evidence to the better operations theory:

  • A 1-star increase on Yelp leads to 5 to 9% revenue increase.  Entrepreneur.com
  • One negative review on Yelp can cost you, 30 customers.  Entrepreneur.com
  • An A grade in your window, for those restaurants that have to contend with health inspection letter grades, can lead to a 5.7% bump in sales.  (Based on California Sales Tax Data for LA County)
  • Only 16% of Yelp reviews are fraudulent so don’t assume that every bad review you have is just a competitor out to get you – respond quickly and appropriately.  Entrepreneur.com
  • According to a recent study by AlixPartners, a global business consulting firm, “28 percent of diners surveyed say they would never eat at a chain affected by a food-safety outbreak, regardless of the geographic location of the outbreak.”  Tennessean
  • Olive Garden same-store sales are up 6.8%. This is what their CEO had to say:

“We’re just running better restaurants today,” Lee said during the company’s earnings call Tuesday. “I don’t think we should discount the importance of ensuring we’re properly staffed, our teams are properly motivated, simplifying the operation, reducing the size of the menu, processes and procedures.  NRN

“One of the things we’re focused on now is trying to keep things simple,” Lee said. “Simple is hard. Doing simple things every day is really hard. That’s what’s given us the biggest lift at Olive Garden. We’re not relying on promotional activity to drive business.”  NRN

Look at your experience in restaurants. The restaurants that serve delicious food with great service that are clean and well managed on average are much busier than their competitors who fall down in any of those areas.

There are so many outside factors affecting your restaurants every day, from minimum wages, weather, street construction, commodity prices, competition, shifting dining trends, government regulations, cook shortages, and social media to name few.  It can feel overwhelming.  How do you manage all of those outside factors and run your restaurant?  The answer is to control what you can control and react as best you can to outside forces.

If you know that you aren’t doing all that you could be doing in your business to run better operations, make a plan and start focusing 100% on your most critical issues and check them off the list one at a time.  

The quickest and most effective way to run better operations is also one of the easiest systems to implement:  checklists with follow-up.  Checklists focus your managers on those most important items each shift that have to be done to operate at your best.  They are self-documenting and easy to use.  By executing checklists every day in the same order, they build a routine and drive consistency shift to shift.  Checklists work, we asked 107 restaurant managers and owners recently if they thought that managing by checklist would help them run safer and better operating restaurants, and 107 of them said yes.

Most restaurants today have checklists in place, but they are conducted on paper, paper checklists make it impossible to hold your team accountable.  We recently conducted a survey and 94% of restaurant owners, and managers believed that their teams weren’t completing their checklists accurately.  94% of paper checklists are being pencil whipped and therefore the restaurant isn’t getting any of the benefits of safer and better operations because people aren’t conducting the checklist.

The key to getting the benefits of your checklists is to use a system like OpsAnalitica that can hold your managers accountable and make pencil whipping a thing of the past.  By simply moving your checklists to a tablet we can track start and end times, duration, and make the data available on any device from anywhere.  You will always know if your team is doing what they are supposed to be doing.

Better operations can increase your sales anywhere from 5 to 9%.  Checklists can play a major part in running better operations on a shift basis.  It is consistent daily execution that will yield the highest returns and generate those positive reviews and word of mouth recommendations that will grow sales organically and in a sustainable manner.

I invite you to check out OpsAnalitica by clicking here.  To see a list of the checklists that every restaurant should be doing, I invite you to check out this other blog post.

If you are interested in seeing OpsAnalitica in action click here to watch a recorded demo video.

Written by

I've been in the restaurant industry for most of my adult life. I have a BSBA from University of Denver Hotel Restaurant school and an MBA from the same. When I wasn't working in restaurants I was either doing stand-up comedy, for 10 years, or large enterprise software consulting. I'm currently the Managing Director of OpsAnalitica and our Inspector platform was originally conceived when I worked for one of the largest sandwich franchisors in the country. You can reach out to me through LinkedIn.

6 Comments Published

by STEFANO LEONE , post on 13 April 2016 | Reply

Great article Tommy. We as chefs we where tough in schools and experience, that a check list followed will generate revenue and flow to a smoother operation.
Best regards
Stefano Leone

by Tommy Yionoulis , post on 14 April 2016 | Reply

Stefano thanks for the insight on what you were taught in school. Better operations will always generate more sales and the best way to run better more consistent operations is through checklists with follow-up. That is what we are all about. Thank you for reading our blog.

by Rob Samples , post on 13 April 2016 | Reply

Right on. Operational performance, consistently excellent performance, is critical. People will drive for miles and miles to go to a restaurant known for consistently excellent quality, value and dining experience.

A cheat proof checklist is an excellent foundation to build on. One next step, building on this foundation, is improving the consistency and quality of the food served. People will overlook a lot if the food is excellent. Even small hole in the wall restaurants can be wildly successful if the quality is there. Just spend some time watching The Food Channel and you will soon see what I mean.

Unfortunately for restaurant owners and customers, egos often get in the way of success. As an example, take cooking meat properly. A bragging right, a right of passage for many men, is their skill at the grill. Many of us think we are pros at the grill. They may be right because even the pros aren’t pros.

To prove my point, Go to almost any steakhouse and order a steak. You’re paying anywhere from $15 -$100 for your meal. You want a quality piece of meat, especially at the higher end of the price spectrum. You expect the professionals to get it right so you can get the most enjoyment for your hard earned money. Sadly almost every steakhouse, regardless of the price point of the restaurant or the culinary pedigree of the cooks, gets the doneness of their meats wrong 30% of the time. About half the time the miscooked meat is over cooked, half the time under cooked.

Under cooked meat always is a disappointment to customers but also results in fewer table turns when the meat is recooked. Over cooked meat is also a disappointment to customers. But the added insult is, if the steak is replaced, not only is table turn reduced by even more than the reduction caused by under cooking but scrap costs increase and the cost of the replacement meat further subtracts from a restaurant’s profit.

A typical steakhouse can easily realize a $30,000 to $50,000 annual profit improvement by eliminating this waste. The technology to stop this waste and the resulting profit loss does exist. Pride or the inertia of “we’ve always done it this way” prevents cooks and restaurant owners from implementing this technology, which often has a direct payback measured in weeks. The Meatrix System by Imagitronix is one of these new technologies that have become available in recent years. The Meatrix System can virtually eliminate this waste resulting in easily quantifiable profit improvement and significantly improve customer satisfaction.

Most cooks or restaurant owners rely on what they learned in school, be it an elite culinary school or the school of hard knocks. These techniques are not based on science. Googling “Meat Myth Memos” will lead you to a series of articles, written in easy to read English, explaining the folly of these techniques and the lack of science behind them. This is just one series of articles about the problem with using these “time proven” techniques. There are others that simply echo the unscientific old wives tales. Beware of these. They just reinforce the same techniques that lead to getting it wrong 30% of the time.

Restaurant owners need to be students of the art. Technological advances and research are constantly developing new ways to improve the art of cooking and the science of running a successful restaurant. It always begins with knowing where you want to go and where you are. A cheat proof checklist that allows owners and managers to hold their employees responsible for providing a superior dining experience and provide them tools to accomplish that goal is a critical base to build on. Then, when the needs and tools are identified, get the tools to meet those needs AND INSIST the tools are used and the techniques are followed. As Tommy mentions in his article, big profit gains are out there for the taking, for those bold enough to reach out and seize it.

Rob Samples
President
Imagitronix

by Mark Harrison , post on 19 April 2016 | Reply

Checklists and staff empowerment, in that everyone is responsible but everyone can be rewarded as long as the behavior to performance metric is specifically measured, transparent and signed off by all parties. Paper or IT systems included!

by Vinny , post on 20 July 2016 | Reply

This forum needed shnakig up and you’ve just done that. Great post!

by Tommy Yionoulis , post on 20 July 2016 | Reply

Thanks Vinny. I appreciate that you took the time to read the blog. Take care