Sad, but true: Your old spreadsheets can’t learn new tricks. If you’re still trying to determine food costs and monitor inventory by staring into a wall of cells, you’re probably wasting resources that you’d rather see on your bottom line.
Specialized food cost and inventory software programs can simplify and speed up some of the most tedious responsibilities of running the business—and converted restaurateurs say that technology makes a significant financial impact.
Still a tech holdout? Lucky for you, these operators have a comeback for any excuse.
Excuse No. 1: “It’s just as much of a time suck.”
Technology-resistant operators often say the software programs require a time commitment to learn and use them, so why bother? Michael Ferraro, executive chef of Delicatessen in New York, discovered analytics tools after spending hours poring over spreadsheets and monitoring product needs and fluctuating food costs. Analytics tools tied to ordering history and food prices, for example, eliminate the time it takes to nail down fluctuating food prices.
The system, Compeat Advantage, also tracks the restaurant’s purveyors, inventory and recipes. It scans the list for the lowest price and then, after orders are received, instantly recalibrates food costs for his recipes. “It takes time to train your people on how to use it,” Ferraro says. “But we can now analyze aspects of our business on a daily basis.”
Excuse No. 2: “It’s only for big operations.”
“This is a falsehood,” says Scott Shaffer, who sold food cost software to restaurants before starting YoGo Express, a sandwich and frozen yogurt concept in Seneca, South Carolina. “The restaurant business is a pennies business, which means every percentage point counts.”
Shaffer, who has owned or operated more than 20 restaurants, says any operation can benefit from software that provides data on food prices and inventory. Instead of trying to avoid running out of inventory by over-ordering, he uses analytics to order exactly how much he needs—and his kitchen has reduced waste and dropped food costs 5 percent.
“The benefit of ordering what you are going through is that you do not have extra dollars on your shelves not making any money,” Shaffer says. The kitchen staff, he says, is also more careful with product knowing that the inventory is limited.
Excuse No. 3: “It costs too much.”
The question is not how much technology costs, but whether you can afford not to have it, says Jason Tschida, owner of DeGidio’s Restaurant and Bar, a 200-seat restaurant in St. Paul, Minnesota.
“Numerous people I know do not embrace technology bec-ause they are stuck on costs,” he says. “They’re going day by day instead of long-term. Over time, all that money saved goes to the bottom line.”
Tschida uses a variety of software across all operations, from scheduling and sales to food costs and liquor inventory. Though the fees range from $45 to $1,000 per month, the software pays for itself in savings from improved efficiency.
He’s seen the greatest savings with liquor. Knowing that inventory is counted and monitored, servers and bartenders are more careful about pouring. The service that costs $1,000 per month has resulted in a $5,000 monthly increase in revenue.
Excuse No. 4: “It’s not accurate or flexible.”
Flexibility depends on the software, which should integrate with a restaurant’s POS system to meet an operator’s specific needs. But accuracy relies on the quality of data entered by staff.
“It all comes down to the foundation,” Tschida says. “People make the mistake of thinking volume and weight are the same. If you put in garbage, you’ll come out with garbage.”
Like anything else, the information used by the program has to be maintained and recipes adjusted or added. “I like technology,” Tschida says, “but I love efficiency. So it all works for me.”
Get Tech Smart
Countless resources can help restaurateurs calculate food costs, price menu items and track inventory. But how do you choose between software like Crunchtime, CostGuard, KitchenCut, Mastercook, Cost Genie and so many others?
Consider these tips:
Determine your needs to find the right software. Then, commit to the effort required to make the technology work for you.
Compare services and reach out to other users for feedback; the software company can provide references.
Invest in training and tech support. Sure, you know how to use the software, but can your staff access the data? Quality tech support and training are essential.
Prioritize a user-friendly interface. No one wants to mess with difficult software.
Negotiate initial fees and monthly costs, which are often determined by the number of users and size of the restaurant. The tech field is getting more crowded; don’t hesitate to bargain.