More operators finding value in data management tools

The movement by multiunit operators to embrace above-store reporting systems—also known as business intelligence capabilities—continues at a brisk clip in foodservice.

Above-store reporting, or ASR, entails collecting point-of-sale and back-office data from multiple restaurants on a real-time or regular basis for analysis, reporting and action. ASR systems can show big-picture trends or such details as the components of an individual transaction.

The use of such technology has risen as the cost of high-speed Internet connections and wide-area networks has fallen and vendors and third-party service providers have modified their offerings to more easily share data.

Dublin, Ohio-based Wendy’s International Inc., which operates or franchises about 6,600 Wendy’s quick-service restaurants, is part of the ASR movement. It scrapped a paper-phone-and-spreadsheet-based reporting system for its approximately 1,500 company-owned stores in favor of the Micros Systems Inc. mymicros.net web-based reporting tool. In so doing the company saved two hours per store per week in labor costs, representatives said. That breaks down to 0.9 hours of collecting sales data and 1.1 hours of compiling and phoning in a weekly profit and loss statement.

At Wendy’s, mymicros.net replaced a legacy reporting system in which district managers culled through stacks of week-old data to find metrics. The district managers also called the stores and had managers read data to them—data that later were entered into spreadsheet software by administrative assistants.

“You had reams of paper when there might be only 22 relevant points of information,” said Roxanne Amidon, Wendy’s director of technology innovations and strategy. “You can imagine the overhead it took to compile and publish this info.”

In contrast, mymicros.net aggregates and analyzes transaction-level information on a near-real-time basis for forecasting and decision-making purposes. It focuses on food cost, labor cost and sales trends. It produces a key metrics report that is displayed online, showing such information as sales for the previous full-day, week-to-date and period-to-date, actual versus projected sales, as well as discount coupons, speed of service in seconds and food-cost variance. “ Mymicros.net lets us see how the day’s performance unfolds rather than having to wait until week’s end,” Amidon said.

In addition, it’s possible to drill down to show further detail. One can see, for example, whether a crewmember’s high number of voids is due to a lack of training or a loss-prevention issue. Alerts appear on the screen in bold and red when preset thresholds are reached for such metrics as manager meals, manager-mode voids and cash over/short.

Mymicros.net automation also makes data more reliable. “There is no massaging as it passes from person to person,” Amidon said. Along with daily polling of end-of-day numbers, mymicros.net also has every-15-minute polling in a near-real-time manner. That’s useful when solving problems or looking at new product rollouts, Amidon said. “For example, last year when we launched gift cards, we were able to see what the trends were as the day unfolded,” she added.

When using mymicros.net , data flows to a variety of “cubes,” or databases supporting analysis of the impact of product rollouts, price-product promotions and average check and transaction trends, Amidon said. She said other tools are used to analyze market mix and product profit and loss.

Mymicros.net also polls data from 300 Wendy’s franchisees. According to Amidon, the arrangement not only permits franchisees to enjoy the benefits of data aggregation and analysis, it also gives Wendy’s a broader view of trends than it might get just polling its own stores, which represent about 20 percent of the total system.

Moreover, because Wendy’s hosts mymicros.net in-house, it is in the process of integrating such other information systems functions as store-level forecasting, labor scheduling and food management.

Micros Systems representatives say the subscription fee for the mymicros.net service runs from $4 to $5 per day per location.

Not all Wendy’s franchisees use mymicros.net . Pennant Foods, a San Diego-based franchisee with 95 stores, uses Syrus Restaurant Information Systems, a service founded by Wendy’s franchisee Jim Karam and eventually spun off into a separate company.

With Syrus, Pennant has seen its food cost drop 50 to 75 basis points, said chief executive Mike Cardinal. A basis point is one-hundredth of 1 percent. The Syrus technology has put sales, food cost, labor cost and product mix information into the hands of store managers for day-to-day management guidance.

“It really helps my managers use information better,” Cardinal said.

Implementing Syrus reporting tools also allowed Pennant to eliminate one full-time information technology position. The payroll savings and lower food expenditures made possible by the technology more than cover the $250 to $300 per-store monthly fee charged by Syrus, Cardinal said.

Store POS data are uploaded nightly to the Syrus database, analyzed by the Syrus account team and drafted into daily online reports that are viewable on the Syrus website by 8 a.m. Cardinal explained, “I look at daily sales, store by store, labor and food cost for the week.”

Also reaping the benefits of improved information collection and analysis is Fox Sports Grill, an eight-unit, Westlake Village, Calif.-based restaurant and sports bar chain that switched to dinePoint by Managed Data Group.

The automated daily POS polling of dinePoint has allowed the company to eliminate a salaried controller position in each of its first five units, saving about $50,000 per store, according to finance manager Bryan McVay.

Furthermore, with dinePoint’s careful monitoring Fox Sports Grill has cut losses from the abuse of comps and discounts from 3 percent to 2 percent of sales, McVay said. Still more savings came from replacing the $150 to $180 per month spent on a “red book,” or manager’s log book for recording interstaff messages in the dining room and kitchen, with dinePoint’s online manager’s log. “Everyone in the restaurant can leave notes electronically and communicate on the same basis,” McVay said.

Also appreciative of the dinePoint manager’s log is Bob Kirkwood, owner of Lewis & Clark’s and Trailhead Brewing Co., a pair of casual-dining restaurants in St. Charles, Mo. “It helps me solve problems in the stores faster,” Kirkwood said.“Before, I had to call the restaurants and have the logs read to me.”

The monthly fee for dinePoint is $150 per location, Managed Data Group officials say.

The ASR choice for Restaurant Management Company, or RMC, a Wichita, Kan.-based operator of 160 franchised Pizza Hut, KFC and Long John Silver’s units, is an in-house system integrated with its SpeedLine POS.

RMC gradually has built the capabilities of its proprietary reporting system. “We said, ‘Let’s add this piece of hardware, let’s get that piece of software,’ ” said information technology director Mark Roberson. “It has grown into a great analysis tool.”

As a side venture, RMC is planning to host its ASR system for other Pizza Hut franchisees on a fee basis, Roberson said.

In addition to daily POS polling of sales and menu mix statistics, delivery analysis, and coupon trends, RMC has installed additional tools for labor scheduling and complaint handling. Better scheduling has led to upticks in pizza sales and lower labor costs. “Our actual and scheduled hours are close,” Roberson said. “We’re not seeing the big fluctuations.” Delivery times, too, are closer to target, he added.

RMC’s in-house reporting system is based on Microsoft technologies and Dundas Visual Imaging software. The latter provides a graphic presentation of business trends.

“You can drill through reports until you’re blind, but when you look at a graph, it’s hard to miss what’s happening,” Roberson said.