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Today’s rapid pace of change and a strong job market force a fresh look at which metrics are
critical to gauge the pulse of your business.
 
 
As restaurants embrace the digital age headlong and make sweeping changes to their operations,
the metrics that are important to owners, operators, and managers are shifting as well. Case in point:
a major international quick-serve brand that instituted several major changes in menu and ordering
channels is now seeing a spike in employee turnover. Could they have curtailed some of the talent
loss based on earlier, or better, insight into the numbers?
 
A strong economy and job market along with other factors make it more important than ever to
get a solid handle on the numbers that indicate the health of your restaurant, your team, and your
  1. Staff turnover
With low unemployment, high turnover is an even bigger problem these days. Paying attention
to retention trends across a restaurant system or within a market and comparing them to individual performance is a good way to measure whether you are taking the right steps to keep good team
members loyal. Turnover is notoriously high in restaurant jobs, and it’s nothing to sneeze at: Tdn2k,
which benchmarks HR statistics and metrics, estimates the cost of restaurant turnover last year
ranged from $1,902 for a back-of-house employee to just over $14,000 for a manager[1].
 
  1. Drive-thru times
Fast food orders that take too long to prepare, especially for drive-through guests, contradicts the
definition of “fast.” McDonald’s, for instance, saw its average order increase last year to 239 seconds
last year, up more than half a minute from the year before and slower than its competitors.
Systemwide, that’s a recipe for many unhappy customers and potential lost business. In McDonald’s
case, the inefficiency could be a symptom of a larger problem—asking workers to do too much—that
is contributing to turnover from burnout[2].
 
  1. Sales or revenue by channel
Is your presence on a restaurant ordering platform like GrubHub worth the cost? Does owning or
renting a food truck and having a presence for your restaurants at events make sense from a sales standpoint? How many people order through your mobile app? By telephone? How much of your 
business is takeout? Knowing the sources of your revenue can help you allocate resources,
(re)structure workflows or even refine the design of your restaurant to better accommodate a new
ordering channel or uptick in foot traffic.
 
  1. Delivery cost
Closely related to sales by channel is delivery cost. Delivery is certainly in demand, but it doesn’t
always make financial sense for a restaurant. Handling it in-house means additional labor, insurance
and vehicle costs; outsourcing the service means paying and trusting a third party to ensure the
food arrives intact, on time. Knowing the costs either way is key to any informed decision about fees
and logistics. And running the numbers on your options - such as limiting delivery to larger orders
or a subset of your menu - can also help with profitability.
 
  1. Social media engagement
Marketers and individual owners measure social media success in different ways, but not paying
attention to your online audience is ignoring its marketing potential. According to a Harvard
Business Review Research Report by Michael Luca, for restaurants, a one-star increase in Yelp
rating leads to a 5-9 percent increase in revenue[3]. So it’s clear that a restaurant’s online presence
and reputation does in fact have an effect on its success. Monitoring likes, shares and follows is
important, but so is responding when someone has posted a gripe on social media. Knowing what
the public is saying about your competitors can provide useful intelligence as well. Look for a
tool that consolidates all of a company’s online reviews into a single dashboard, along with reviews
of competing businesses. Even better if it also facilitates responses to reviews.
 
Restaurant operators have always relied on key numbers to determine whether they are succeeding,
but as the industry evolves, so do the metrics that help steer operations and marketing in the
right direction.
 
 

[1] https://www.tdn2k.com/services/people-report/turnover-calculator/
[2] https://www-latimes-com.cdn.ampproject.org/c/www.latimes.com/business/la-fi-
mcdonalds-mobile-app-20180313-story.html?outputType=amp&lipi=urn%3Ali%3Apage%3Ad_flagship3_feed%3BQsbmeRw%2BT5Sa1
%2FKL91%2FCNQ%3D%3D&licu=urn%3Ali%3Acontrol%3Ad_flagship3_feed-object
[3] http://www.hbs.edu/faculty/Publication%20Files/12-016_a7e4a5a2-03f9-490d-
b093-8f951238dba2.pdf

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