SpotOn in the present day introduced the discharge of its State of Restaurant Tech Report, offering insights from impartial restaurant operators on the speed of expertise adoption, rising challenges, and predictions for the yr forward.
Tech Investments on the Horizon
Whereas the speed of expertise innovation and adoption has risen sharply over the previous few years, a overwhelming majority of impartial operators (81%) are nonetheless utilizing legacy point-of-sale (POS) methods. Nevertheless, that seems more likely to change, as 75% say they’re more likely to convert to a brand new expertise system within the subsequent 12 months. Amongst High quality Eating eating places, that quantity surges to 85%.
Whereas POS methods stay the main expertise, different types of restaurant tech are rising. Roughly 1 in 4 respondents report that they’re presently utilizing accounting platforms (25%), loyalty packages (25%), worker scheduling (24%), QR codes for menus/ordering/cost (24%), and on-line ordering capabilities on their model’s web site (24%). When requested about future investments, greater than half of the respondents indicated that they deliberate to put money into these applied sciences in 2023.
Challenges: Price, Complexity, and Labor Administration on the Forefront
Operators face numerous challenges, however three rose to the highest as anticipated challenges within the subsequent 6 months: rising prices, operational complexity, and labor administration. An unsure and fluctuating market has brought about costs to skyrocket on every part from elements to power, whereas labor shortages and sophisticated rules have required operators to take a a lot nearer take a look at how they handle their workforce. And operators don’t see these challenges abating.
The rising value of operations ranks as the highest problem for impartial and small chain operators, pushed by meals prices (29%), labor prices/wages (24%), elevated beverage prices (19%), and elevated packaging/disposable prices (19%). Different challenges operators anticipate going through embody worker retention (21%), provide shortages (20%), decreased buyer spending (20%), and a recession (18%).
Labor administration follows intently because the second most urgent problem. SpotOn discovered that managers spend greater than 16 hrs per week (or two full days) on labor-management duties, together with:
- payroll: 3.3 hours / wk
- calculating suggestions and payout: 2.9 hours / wk
- employees scheduling: 2.3 hours / wk
- sustaining labor compliance: 2.2 hours/wk
- managing additional time: 2.2 hours / wk
- tip distribution/tip administration: 2.1 hours / wk
- verifying employees clock in, clock out punches: 1.6 hours/wk
When requested about rising operational complexity. operators additionally pointed to labor administration duties as the first drivers, with 44% citing payroll as an rising problem and 38% citing labor compliance. Relating to payroll, 51% of operators report that they expertise payroll issues no less than as soon as per week. In Fast Service and Quick Informal eating places, that quantity exceeds 60%.
“We’ve discovered that operators can save 20 hours every week when using the suitable expertise to handle the rising complexities of working a worthwhile restaurant,” mentioned Kevin Bryla, CMO of SpotOn. “Investments in expertise will turn out to be crucial for operators to enhance their restaurant’s efficiency and deal with supporting their groups to create really memorable eating experiences.”
Regardless of Challenges, Revenue is Slowly Returning
Earlier this yr, SpotOn launched Factors of Revenue, a information to assist eating places increase their notoriously slim margins. Regardless of continued challenges with inflation and labor complexity, SpotOn is thrilled to see that 78% of operators surveyed reported an enchancment in revenue margin during the last yr, with 31% bettering by double digits.
Know-how has performed a major position in how eating places improved their margins. SpotOn’s suite of built-in options are designed to assist operators enhance income and decrease prices, to allow them to incrementally enhance their revenue margins. For example, after utilizing QR codes for 12 months, SpotOn purchasers noticed a 3% enhance in examine averages and a 9% enhance in complete gross sales.
One space of alternative for operators to claw again extra margin is to observe the lead of fine-dining eating places and encourage clients to order takeout and supply immediately by their restaurant, avoiding third-party charges. Client demand for takeout and supply has risen dramatically, making takeout and supply expertise important for operators, which accounts for 3 in ten orders, most of which come by a third-party order platform.
With sturdy information to show the impression of built-in expertise in a restaurant, what prevents operators from investing? The survey discovered that value is the first barrier, adopted by coaching employees on new expertise (29%), considerations across the pace of service and restore (29%), and ease of use (24%). Whereas value is cited as the first barrier, it isn’t the one consideration when making expertise purchases. Total, 48% of operators prioritize efficient options or providers and help over worth within the expertise buying course of, with each fantastic eating (50%) and quick informal (31%) operators putting the simplest expertise options, no matter worth, above all.
Operators acknowledge the vital position expertise will proceed to play of their enterprise and are planning to put money into expertise to handle the challenges they’re going through in the present day and sooner or later.
Trying forward at 2023
As restaurant operators look in the direction of 2023, funding in expertise is rising and doesn’t present indicators of slowing down. Seventy-one % (71%) of impartial and small chain restaurant operators count on to extend spending on expertise methods in 2023, with fine-dining operators more likely to take advantage of vital funding. At a unit degree, operators typically count on to take a position as much as $30K in expertise subsequent yr. What do they plan to spend on?
- 68% plan to put money into payroll administration
- 66% plan to put money into worker scheduling
- 64% plan to put money into CRM or Electronic mail Advertising program
- 63% plan to put money into on-line reservations/waitlist administration
- 63% plan to put money into a loyalty program
- 63% plan to put money into accounting
- 63% plan to put money into QR codes for menus, ordering, or cost
- 59% plan to put money into digital kitchen show methods (KDS)
- 58% plan to put money into a employees communication software
- 57% plan to put money into on-line ordering capabilities on their model’s web site
- 54% plan to put money into cloud-based POS
Practically half of operators plan to pursue a enterprise mortgage within the subsequent yr, with the bulk supporting the expansion and growth of their restaurant idea. SpotOn discovered that limited-service eating places usually tend to plan for a mortgage than full-service eating places. What’s standing in the way in which of operators acquiring a mortgage? 23% of operators say curiosity stands out as essentially the most vital barrier to acquiring a mortgage, whereas 17% had considerations about compensation and 15% have been fearful about getting funds in time. SpotOn Capital presents quick, inexpensive funding, so the house owners of Bardo and Vana in Charlotte, North Carolina, might fund the growth of their enterprise to a brand new location with cash from their present companies whereas paying at their very own tempo.
As restaurant operators proceed to navigate the uncertainty of what lies forward, SpotOn is able to present restaurateurs and operators with a completely built-in restaurant administration platform complemented by 24/7/365 help from Restaurant Success Managers that know eating places. From a lightning-fast, cloud-based point-of-sale to labor administration instruments, SpotOn’s strong {hardware} and software program options are constructed for restaurateurs by restaurateurs with enter from trade leaders like Michael Mina and Matthew Kenney. SpotOn expertise is constructed to drive restaurant effectivity, increase revenue, and simplify the worker expertise to allow them to ship an unbelievable visitor expertise.
The information cited was developed by Technomic, a number one restaurant trade market analysis and consulting agency, on behalf of SpotOn. To acquire the information featured, Technomic carried out surveys with 300 impartial and small chain restaurant operators in August 2022. Members weren’t compensated or in any other case incentivized by SpotOn. The information introduced precisely replicate the survey questions posed and participant responses.
Learn the complete report here.
