The restaurant industry is in a state of transformation as Americans increasingly shift their food spending toward dining establishments and away from grocery stores.
Restaurant growth has outpaced grocery growth in three of the past five quarters, with consumers now spending more than half of their food dollars in restaurants.1 In the summer of 2018, restaurants reached the fastest three-month period for sales growth in more than 25 years.2
While this is good news for restaurateurs, it also presents challenges. Customers are demanding more from the restaurants they visit, leaving eateries to confront thorny issues such as how to improve efficiency, convenience and overall satisfaction.
Here are several ways restaurants can overcome these challenges.
For many diners, a great restaurant experience is not strictly about the food. It’s also about atmosphere, information and service. As they frequent restaurants more than ever before, consumers are curious and exacting.
“Diners are looking for an experience when they go out,” says Barbara Castiglia, executive editor of Modern Restaurant Management magazine. “When they’re choosing where to go, they want something authentic. And they want it to be an experience personalized to them.”
A personalized dining experience can mean many different things. It could refer to customizable menu options or the server knowing exactly which seat got which order. For some diners, it could be the ability to split the check several ways.
Meanwhile, diners also want convenience, says Jonathan Sepulveda, senior vice president, group product manager at Bank of America Merchant Services.
They’re interested in ways to order and pay when and how they want, whether through digital payments or paying at the table. “Simplicity has become an expectation in the world today, and small businesses need to evolve to compete more effectively with larger competitors,” says Sepulveda.
For many restaurateurs, technology is the key to delivering what consumers want while also helping to streamline their business operations. Cloud-based systems can make it simple for restaurants to manage sales and record data across multiple devices and locations.
“It’s an interconnected layer of technology that helps run a business from beginning to end,” says Derrick Carpenter, executive vice president of integrated payments, digital commerce & marketing at Bank of America Merchant Services. “It allows the business owner to operate in a way that can help them become more efficient and profitable.”
Even for single-location restaurants, cloud-based technology can revolutionize the way they do business.
Restaurant POS systems can provide valuable analytics and insights that an owner can access from anywhere. Joy Ghanekar, head of product at talech, a tablet-friendly POS system, says a cloud-based system can give business owners powerful data that helps them manage all aspects of their restaurant — like inventory, staffing and customer behavior — which in turn can help them make better decisions. “
This type of system provides access to every single aspect of your business without having to physically be at the business,” says Ghanekar. “You can find out: How did I do in sales today? What are my top selling items? Who collected the most tips? What’s not selling? Do I really need a staff of 20 people?”
How can restaurants successfully manage the challenges posed by today’s more demanding customer? In addition to embracing cloud-based technologies, restaurateurs should consider implementing these tactics:
Offer multiple ways to pay, securely. Successful restaurants adapt to meet the needs and desires of their customers — not only through new menu offerings, but also through accepting multiple payment methods. Customers today expect restaurants to take payment via various credit cards and want online and mobile payment options, as well. And restaurateurs should remain vigilant when it comes to protecting customer card data: Security features such as end-to-end encryption and authentication technology are must-haves.
Maximize efficiency. Restaurants staying ahead of the curve are paying special attention to handling orders faster and making transactions as smooth as possible. They’re using systems that assign courses and dispatch tickets to multiple printers for quick processing, and they’re streamlining checkout by offering suggested tip amounts and allowing diners to skip signatures on low-price tickets.
Reward your customers. Discount and reward programs can help build and maintain relationships with customers and give them incentives to keep returning. Many restaurants are taking advantage of apps to create special offers that bring customers in the door and allow them to track their rewards.
“Small businesses need to evolve to compete more
effectively with larger competitors.”