NB: This is an article written By :Ken Burgin
With smart ‘future-watching’, you can adjust capacity to reflect the level of expected business. When you avoid surplus staff and unnecessary preparation, there’s a nice boost to the bottom line.
Caterers can work with 100% certainty for much of the time – business is pre-booked and pre-paid. They can achieve 20% food costs and similar wage levels because they work with exact numbers and do their purchasing and staffing accordingly. And it’s why they keep their mouths shut when the conversation turns to low profits in the food business!
So how can a café, restaurant or bar forecast more accurately?
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1. Maintain logbooks & diaries: record customer numbers, weather, special events, the pattern of customer visit etc. Logbooks are more informative than a blank diary page. The immediate past is often a good guide for the coming weeks or months.
2. Make sure staff understand the numbers you talk about. Do they know how many more customers to expect if the bar will be 25% busier than last week, or one-third down on last month?
3. Predict the effect of TV and sporting events. Your staff TV nut or sports fan can monitor these – some events mean more trade, some mean less.
4. Watch out for local events that will boost business. Adjust your opening times accordingly, eg popular concerts and local festivals. This can be a great time to open specially to catch the crowds. The local tourist information office and internet will have information.
5. Use a good sources of weather information and track regularly. On the internet Weatherbug or your local weather channel will show up to 7 days in advance. Will you need extra staff on the weekend?
6. Track the effect of changes in temperature, snow and rainfall. Many bakers adjust the cooking of hot snack items like pies to the temperature and have become quite exact with it as a money-making exercise. What’s your equivalent product?
7. Develop more flexible staff schedules. Explain about how changes are decided, so it’s not ‘unfair’ when shifts are increased or decreased. If you are developing a new workplace agreement, why not take this into account.
8. Develop a staff standby system. If someone is on-call, pay them an agreed allowance to be available, and also pay it if they are called in. You will build staff loyalty and overall your costs will be lower, even if you occasionally pay someone for just being home and watching TV. This turns the scheme around so staff are not expecting to be cut back but hoping for some bonus shifts.
9. Reduce ‘just-in-case’ over-staffing. Prepare your Plan B for an unexpected rush – it may be more profitable to maintain normal staffing levels but institute a smarter queueing system and ways to turn over customers more quickly.
10. Work out the ‘strike rate’ for product demand. For example, if 100 people dine out of 500 visitors to your club or bar, you have a strike rate of 20%. This will be a guide for when you are expecting 200 or 2000 visitors (and, in this case, one which could be improved).
In the longer term:
11. Watch population changes in your area, both residents and workers. Census data can help but this is only updated occasionally. Your local observation will be a more reliable guide. This can also give you a guide to negative events that may be looming, eg a business relocating from an office block may mean the loss of hundreds or thousands of potential customers.
12. Watch industry trends to keep your business ahead of the game. Faster service, healthy options, the obsession with ingredients and new flavours, legal regulations, the ageing population – all changes that can have a significant effect on the type, preferences and number of customers you see.
Keep your focus on forecasting and sales building, rather than reactive cost cutting: you will soon see the difference.
