No one hates wasted money more than restaurants. But that’s exactly what’s happening.
With the best profit margins in the industry sitting at 3-5%, restaurants are seizing software and apps that either help increase their bottom lines or keep money in their bank accounts. Or so they think. Most restaurants actually throw away hundreds of dollars - if not more - on restaurant technology every month.
An army of tech companies fight for a restaurant’s attention, all with products offering to help make their lives easier while saving them money. Restaurants believe they are saying yes to tools that will help in a significant way, when the opposite is true. Technology actually sucks money out of restaurants in three ways.
#1 It’s a Bad Fit
Restaurants say yes to technology before understanding what it offers. They’re allured by the increased efficiency, fewer errors and customer satisfaction technology will bring their businesses. Operators are left with a solution that generally meets the need they want to fill, but under-compensates on features important to their particular establishment.
To avoid a bad technology fit, shop the industry before saying yes to a solution. There are currently over 11 categories of restaurant technology, with over 200 companies offering products and services within those groups. It’s important for operators to take the time to find technology that best fits his or her restaurant’s size, budget, and needs.
#2 There’s Too Much Of It
Restaurants waste money on technology when they overbuy. They go on a shopping spree of restaurant technology, buying several tools at once. But this often leads to overspending and poor execution.
It’s essential for restaurants to prioritize the tech they buy:
What is going to save you the most money or bring you the most return in the shortest amount of time?
How much can you afford to spend? In other words, decide what your budget is for restaurant technology overall so you know how many solutions you can purchase.
What is a painful issue in your restaurant (front-of-house or back-of-house) that needs to be addressed right away?
What is going to be the easiest or most worthwhile tech for staff to learn?
Many restaurants make the mistake of buying for a need they have today, looking for an immediate answer to a plaguing problem. This is how money gets wasted. These solutions solve for the short-term instead of promoting long-term success.
#3 It Goes Unused
The biggest money-waster, the mac-daddy of them all, is technology that goes unused. Even the simplest DIY solutions available for restaurants require some setup, some data entry, some training. If operators don’t follow the steps and create habits of success, the benefits technology provides will never materialize.
If a restaurant doesn’t review the data its analytics tool provides, it can’t make better business decisions for the future. If employees haven’t been trained to use ordering or inventory software, then those processes won’t become more efficient. In all cases of technology going unused, the restaurant has already paid for it: money goes down the drain that could have been reinvested in the business or other technology.
Stop Wasting Your Money
There’s no doubt restaurant tech will expand and improve. Restaurants shouldn’t feel a rush, pressure, or lure to buy every kind of technology available. Many of the available software and apps haven’t been honed to their fullest potential and the best tech may not even have been created yet.
Instead of buying technology that’s a bad fit, restaurants should spend time deciding what technology they need most and which ones they can afford right now. Instead of buying a lot of technology at once, restaurants should invest in the solutions they can execute well. Instead of letting tech go unused, restaurants can put the time and money into setting up and creating habits around their solutions.
It’s time for restaurants to stop wasting their hard-earned money on technology that sucks. It’s time for them to start using restaurant tech for what it does best: saving money and increasing the bottom line.
Author Bio: Joy Ugi writes about restaurant technology, operational efficiency, and food purchasing trends for Orderly - the #1 restaurant app for online ordering, paperless invoicing, and painless inventory.
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