HALLOWEEN MUST READ: Uncovering the Face of the Boogeyman in the Restaurant Industry

By Matthew Mayer, Business Development Representative

The Boogeyman is a popular mythical creature, known in most cultures.  He has no specific appearance but strikes fear into both children and adults alike.  How can such a non-specific allusion be dreaded by so many?  Simple – the Boogeyman is fear of the unknown.

In the restaurant business, there are a lot of unknown factors that cause us angst every day.  Let’s peek into some of these dark areas, and see how we can bring some of these Boogeymen into the light.


Boogeyman Scenario #1 – Phantom Food Cost Goals

Do you have your food costs and inventory controls where you want them to be? 35% is said to be an accepted average in the industry, but every restaurant is unique, depending on their specific variables.

You should do your best to find out what your sweet spot is, then do all you can to stay below it.  Best practice proves that you must do inventories consistently in order to understand what you are spending compared to what you are using.   If these figures do not match, then you have to find out where you are losing money.  Odds are you have invoicing errors, your portion controls are off, waste is not being tracked, there is over-pouring in the bar, and so on. Such factors slowly eat away at your profits, and without a system in place to track them, it is impossible to narrow down what your food costs need to be, and how to get there.

Boogeyman Scenario #2 –Skeletal Use of GL Codes

Some operators try to simplify their P&L by lumping items together.  However, if you only monitor something as vague as “dairy”, then it is impossible to pinpoint your issues.  An expansion of “dairy” into cheese, cream, whipped topping, half and half, whole milk, 2% milk, etc., gives you an added level of control and insight, allowing you to pinpoint that your dairy is too high because the 2% milk is being over-ordered.

Boogeyman Scenario #3 – Doomed Sales

When it comes to sales, sometimes it is not what you expect, it is what you inspect.  You can increase each server’s sales by holding them accountable for their numbers.  Base level polling allows you to look at an individual’s sales to find out what they sell well and what they do not.

Helping less productive servers is an obvious as you may easily be able to determine that “Mike” never pushes the weekly specials.  However, you can also improve the overall numbers of even your best performers.

Let’s take non-alcoholic beverage services such as ice tea or soft drinks for example.  “Mary” is a star, selling $10,000 in food and alcohol in an average week, but you notice that her non-alcoholic (NA) beverages are extremely low.  It is possible that she is not ringing them in, or not suggestive selling to her customers.  With NA beverages averaging about 10% of the check average, that is a huge missed opportunity.  Imagine increasing this to 25% – what would that do to your sales number?

Boogeyman Scenario #4 – Buried Mistakes in Franchisee Reporting

Any time that there is contractual reporting being shared between two parties, there is the possibility of under-reporting.  Whether this is done intentionally or due to a system or human error, money is still being lost.

Integrating a reliable polling system can remove all the guesswork and errors, and simplifies sales reporting by removing the middle man from the scenario.  Franchisers can automatically poll their franchisee’s locations to see how they are doing at any given time, without interrupting anyone’s work.  You can even back poll a quarter (or even year) period to check for previous discrepancies that may have occurred.

Turn on every light.  Check behind every door.  There is always a potential boogeyman hiding in your restaurant, eating away at your profitability.  Once you expose him, you no longer have to be afraid of the unknown.

Matthew Mayer

Matthew Mayer

Matthew has 20 years of restaurant experience. Prior to joining Compeat as a Business Development Manager, Matthew was an executive with a restaurant accounting company and brings his years of human resources, leadership, and operations experience to assist in becoming Compeat client’s strategic business partner during the sales process.