Head Office Dashboard Secrets:12 KPIs Every Restaurant Chain Executive Should Monitor Daily for Maximum Productivity and Profitability

Running a successful business that deals with perishables on a large scale, such as a restaurant chain, can make profit tracking a nightmare for business owners. The operations, spread across multiple locations, make it nearly impossible for decision-makers to closely monitor spoilage, theft-induced shrinkage, sales, and other key metrics simultaneously.

Here, the powerful combination of restaurants’ ERPs and a comprehensive suite of POS terminals, POS scale, and other POS peripherals can be game-changing. On several occasions, including one of our recent blogs, Smart Kitchen Revolution- How Centralised Kitchen Management Systems Transform Multi-Location Food Preparation and Cost Control, we have covered how business heads can remotely track restaurant KPIs across locations in real-time by integrating robust restaurant ERPs, such as QPOS, into comprehensive POS hardware.

Although ERPs, including QPOS, can automate daily restaurant KPIs for executives without the trouble of manually crunching the massive data sets, dashboards crammed with restaurant performance indicators can be overwhelming. Hence, for effective use of Analytics and Reporting, narrowing down the dashboard fields to the right set of parameters becomes vital.

To help enterprise restaurant businesses overcome any challenge they may face with excess or insufficient fields on the ERP dashboard, let us, in this blog, explore 12 essential KPIs for chain restaurant success. Curious? Read on to know more!

Discover 12 Restaurant KPIs for Franchise Businesses

Here are the key daily restaurant KPIs for executives as well as business owners:

Cash Flow: This parameter tracks net transaction volume per day based on the day’s sales and operational expenditure. Measuring the amount of money moving in and out of the business, the restaurant KPI is central for evaluating the financial health of the business.
COGS: COGS, i.e., Cost of Goods Sold, is a key daily restaurant KPI for executives because it helps evaluate the value of inventory sold. Considering that restaurant inventory is restocked cyclically and during purchases, not all old inventory is sold, COGS aids in determining the ideal budget for the Purchase Order.
Gross Profit: Simple-to-understand and equally vital for tax planning, financial planning, forecasts, etc., gross profit is a fundamental restaurant KPI, which calculates the total profit made in a period of time by subtracting the COGS—which in certain cases factors in the labour cost—from the revenue.
Profit Margin: Given that gross profit might be misleading about the performance of the franchise because the figure doesn’t paint a picture of how effective the sales strategy, including menu engineering, was, profit margin is calculated. An essential KPI for restaurant success, profit margin refers to the percentage of actual gains after the total revenue earned in the given period.
Food Cost Percentage: To track profitability at the order-level, this is one of the essential KPIs for chain restaurant success, indicating the percentage of an order’s sell price that went into the making of the order.
Prime Cost: Much like food cost percentage, this KPI tracks, at the order-level, the labour cost as well as the amount spent on food preparation in terms of ingredient cost.
Outlet Performance: This restaurant KPI is used to understand the challenges and the advantages of each outlet, given that each operational unit has a built-in operational cost. The KPI tabulates different permanence indications of each outlet and compares them to those of other outlets.
Inventory Turnover: While inventory control is vital and a certain amount of shrinkage may often be inevitable, the restaurant KPI aims to calculate the ratio between inventory used and the inventory lost, indicating how effective the franchise’s menu engineering is.
Food Waste: Restaurants prepare a lot of dishes in advance or at least pre-cook certain elements of the dish, such as gravies, sauces, bases, etc, which are prone to spoilage. Similarly, customers can waste the food served. Therefore, by calculating food waste, business owners can track where the problem lies and change portion size, change the quantity of the pre-made elements, and redistribute the use of the core ingredients to a better-performing dish. Calculating this daily restaurant KPI for executives requires considering plate wastage, wastage during any stage of preparation, and also spoilage at large. Also, if an anomaly is noticed in the food waste KPI, owners can also conduct an investigation to track negligence and fraud.

Would you like to know more about fraud? Read our blog: Restaurant Fraud Exposed: How Enterprise Chains Lose Revenue, and the 360° Protection Cloud-Based ERP Systems Provide.

10. Average Ticket Size: Curious how effective your menu engineering and pricing are? Whether you are making profits or losing money due to overpricing, causing small ticket sizes or an undervalued menu? Checking the ratio between total revenue and the number of transactions, this restaurant KPI tracks how much, on average, customers are spending on their orders.

11. Average Covers: Calculating how many guests are usually served in a given time can help optimise shifts, rearrange inventory based on hourly or daily demands, etc. This is exactly what, as an important KPI, an average cover helps identify.

12. Footfall Rate: The metric is used to understand when the maximum number of customers visit a restaurant, i.e., the rush hours.

Quick Recap of How QPOS Can Help Track Essential KPIs for Chain Restaurant Success

Below are the operations management pointers to keep in mind to successfully track key restaurant KPIs:

Use a POS scale at every stage, procurement, inventory use, and inventory audit for automatic inventory data capture
Ensure role-based access to fields in the QPOS ERP
Install CCTV cameras across the restaurant infrastructure to investigate anomalies and overall security
Configure dashboards effectively

When these best practices are followed, operations management with QPOS can be a cake walk, especially given the great interface of the restaurant management software platform, which has several modules, including Sales Tracking, Analytics, and Inventory Management. The software also allows seamless integration with other key platforms, including those for loyalty management, accounting and taxation, and promotions, among others. Most importantly, in terms of Analytics, QPOS allows in-depth understanding of restaurant performance with provision for customised dashboards, based on the level of performance nitty-gritty the business wants to track.

Final Note

While it is amply clear how QPOS simplifies Restaurant Analytics, are there other vital KPIs F&B outlets must track? Stay updated on our blog page to know more.

For further queries and sales quotes, contact us now, and one of our executives will get in touch with you shortly!