Understand the main restaurant performance indicators of the bar of the day

Introduction

The performance of bar-of-the-day restaurants is measured by seven metrics that are key performance indicators (KPIs). In this blog post, you will learn about these KPIs and how to measure and calculate them for effective bar and restaurant monitoring. Here are the seven KPIs monitored for bar restaurants of the day:

• Average revenue per customer
• Number of repeat customers
• It’s time to engage the first client
• Percentage of food cost of income
• Gross margin
• Average check per customer
• Customer Satisfaction Score

The seven metrics mentioned above are used to measure a restaurant’s performance and success. Read on to learn how to track and calculate them for effective bar and restaurant monitoring.

Average revenue per customer

Definition

Average revenue per customer (ARPC) is a key performance indicator (KPI) used to assess a company’s profitability by measuring the average revenue generated by each customer. It’s important to track this metric because it can give you insight into how your business model is performing and help you make informed decisions about pricing and customer engagement.

Benefits of Tracking

Tracking Average Revenue Per Customer (ARPC) is beneficial for all-day bar restaurants as it provides insight into the financial health of the business. By calculating ARPC, you can identify areas of the business that are performing well or underperforming, and make adjustments accordingly. Additionally, ARPC is a great way to benchmark performance against industry benchmarks and better understand customer behavior.

Industry Benchmarks

Average revenue per customer (ARPC) is usually calculated by dividing total revenue by total customers. Industry benchmarks can vary widely depending on the company, but a good place to start is to aim for a higher ARPC than your competition. High ARPC indicates that a business has a loyal customer base and is able to generate more revenue from each customer.

How to calculate

The formula for calculating average revenue per customer (ARPC) is: ARPC = total revenue / total customers.

Calculation example

For example, if a one-day bar restaurant generated ,000 in total revenue from 100 customers, the ARPC would be calculated as follows:

Tips and tricks

To maximize average revenue per customer (ARPC), it’s important to track customer engagement and ensure customers are happy with their experiences. Additionally, offering discounts and promotions can help increase ARPC by encouraging customers to buy more. Finally, tracking industry benchmarks can help identify areas where a company can improve and better compete against competitors.

Number of repeat customers

Definition

The number of repeat customers is a KPI that measures the number of customers returning to the restaurant over a defined period of time. This is an important metric to track as it is a good indication of customer loyalty to the restaurant.

Benefits of Tracking

Tracking the number of repeat customers gives restaurants a better understanding of customer loyalty to their restaurant. This KPI also helps restaurant owners identify the most popular items and services that customers are likely to return for. It also allows them to target customers who are less likely to return with special offers and discounts.

Industry Benchmarks

The industry benchmark for the number of repeat customers is usually around 20-30%. This means that 20-30% of customers who visit a restaurant are likely to return within a certain time frame.

How to calculate

The number of repeat customers can be calculated using the following formula:

Calculation example

For example, if a restaurant had 100 customers in a month and 20 of them returned in the same month, the number of repeat customers would be calculated as follows:

Tips and Tricks for KPIs

• Encourage customers to sign up for loyalty programs to track the number of repeat customers.
• Provide incentives such as discounts and rewards to loyal customers.
• Monitor customer feedback to identify what they like and dislike about the restaurant.
• Analyze data to identify trends and patterns in customer behavior.

It’s time to engage the first client

Definition

Time to first customer engagement is a key performance indicator (KPI) that measures the time it takes to engage a customer in your restaurant or bar. This metric is important for measuring customer satisfaction and the effectiveness of customer service staff. By tracking this KPI, companies can identify areas for improvement and optimize the customer experience.

Benefits of Tracking

• Measures customer satisfaction with service
• Identifies areas for improvement
• Provides insight into customer behavior
• Helps companies optimize the customer experience

Industry Benchmarks

The industry benchmark for time to first customer engagement is typically between 15 and 30 seconds. This means customers should be greeted within 15-30 seconds of entering a restaurant or bar. Any time outside of this range may indicate a problem with customer service.

How to calculate

Customer first engagement time can be calculated by measuring the time it takes from the time a customer walks into the restaurant or bar to be greeted or engaged by customer service staff. This can be done manually or with a customer tracking system.

Calculation example

For example, if a customer walks into a restaurant at 8:00 p.m. and is greeted by customer service staff at 8:05 p.m., the first customer engagement time is 5 minutes.

Tips and tricks to improve the KPI

• Train customer service staff on customer engagement techniques
• Provide incentives to customer service staff to quickly engage customers
• Use customer tracking systems to measure time to first engagement
• Quickly identify and resolve customer service issues

Percentage of food cost of income

Definition

Food Cost of Revenue Percentage (FCPR) is a metric that measures the cost of food and beverage purchases relative to the restaurant’s total revenue. It is a performance indicator widely used to assess the financial health of a restaurant.

Benefits of Tracking

Tracking FCPR is beneficial for restaurant owners as it can provide insight into the profitability of restaurant operations. It can also help identify areas for improvement in purchasing processes and menu engineering.

Industry Benchmarks

The average FCPR for restaurants varies greatly depending on the type of restaurant. Generally, restaurants with a full bar have a higher FCPR than restaurants without a bar. The following table gives an overview of the average FCPR for different types of restaurants:

• Restaurants in case of fasting: 25-30%
• Full-service restaurants: 28-35%
• Bars/pubs: 30-40%
• Gourmet restaurants: 32-40%

How to calculate

The calculation of FCPR is relatively simple. It is calculated as follows:

Calculation example

Consider a restaurant that has a total revenue of 0,000 and a food cost of ,000. The FCPR of this restaurant is calculated as follows:

Tips and tricks

The following tips can help restaurant owners improve their FCPR:

• Negotiate with food suppliers to get the best prices.
• Regularly review menu prices to ensure they are not too low.
• Monitor inventory to ensure food is not wasted or spoiled.
• Track changes in food cost over time to identify areas for improvement.

Gross margin

Definition

Gross margin is a metric used to measure a restaurant’s profitability. It is calculated as the difference between total revenue and total cost of goods sold (COGS). This metric is used to measure the efficiency of a business in terms of the money it can generate relative to its costs.

Benefits of Tracking

• Gross margin helps identify areas where costs can be reduced.
• It helps to track a restaurant’s profitability and compare it to industry standards.
• It can also be used to assess the effectiveness of a restaurant’s pricing strategy.

Industry Benchmarks

The average gross margin for a bar or restaurant is usually around 20-30%. This may vary depending on the type of restaurant and the type of food and drink served.

How to calculate

Gross margin is calculated by subtracting total cost of goods sold (COG) from total revenue. The formula is:

Calculation example

For example, if a restaurant has total revenue of 0,000 and total cogs of ,000, its gross margin would be:

Tips and tricks

• Be sure to regularly track total revenue and total COGs.
• Compare your restaurant’s gross margin to industry standards to identify areas for improvement.
• In addition to gross margin, track other profit-related metrics such as net profit and EBITDA.

Average check per customer

Definition

Average check per customer (ACPC) is a key performance indicator (KPI) that measures the average amount spent per customer, or average check size, at a restaurant or bar. This metric can be used to help identify sales trends and pricing strategies.

Benefits of Tracking

The ACPC measurement helps restaurant and bar owners understand their customer base and sales patterns. Tracking CAAA can help identify pricing strategies that are working and can aid marketing and promotional efforts. Additionally, tracking CAAA can help identify potential areas for improvement, such as increasing the average check size by selling or offering special offers.

Industry Benchmarks

The average check size for restaurants and bars varies by type of establishment and location. A bar in a metropolitan area may have an average check size of , while a casual family restaurant in a small town may have an average check size of . It is important to follow the CAAA against industry benchmarks to ensure that the restaurant or bar is performing as expected.

How to calculate

The ACPC is calculated by taking the total sales during a given period, divided by the number of customers served during the same period. The formula for calculating ACPC is:

Calculation example

For example, if a bar had total sales of ,000 and served 5,000 customers in a given month, the ACPC for that month would be (,000 / 5,000 = ).

Tips and tricks

• Focus on upselling and specials to increase the average check size.
• Track ACPC against industry benchmarks.
• Analyze customer profiles to better understand sales patterns.
• Monitor the ACPC to make sure the restaurant or bar is operating as expected.

Customer Satisfaction Score

Definition

Customer Satisfaction Score (CSS) is a metric used to measure customer satisfaction in a restaurant or bar. It is calculated by reviewing customers on their experience and is used to identify areas where the restaurant or bar can improve.

Benefits of Tracking

Tracking customer satisfaction is an important tool for restaurants and bars. By understanding how customers feel about the experience, businesses can identify areas for improvement and make changes that will lead to higher customer satisfaction and more returning customers.

• Identify areas for improvement
• Increase customer loyalty and customer return
• Identify areas where customers are most satisfied

Industry Benchmarks

Industry benchmarks vary depending on the type of restaurant or bar. Typically, industry benchmarks for customer satisfaction range from 80-90%.

How to calculate

Calculating customer satisfaction is relatively easy. To calculate the customer satisfaction score, companies should ask customers about their experience and determine the average score. The score is then calculated by adding the total score and dividing it by the total number of customers.

Calculation example

For example, if a restaurant surveyed 100 customers about their experience and the total score was 500, the customer satisfaction score would be 5 (500/100).

Tips and tricks

• Be sure to survey customers regularly.
• Offer incentives to customers to complete the survey.
• Be sure to ask open-ended questions that allow customers to provide feedback.
• Consider using a third-party survey platform to help track and analyze customer feedback.

Conclusion

The seven key performance indicators are all valuable metrics for measuring a restaurant’s success. Knowing how to track and calculate these KPIs is key to effectively monitoring your restaurant’s performance. With knowledge of these seven KPIs and careful monitoring, you will be able to measure and track the performance of your bar restaurant to ensure its success.