You may know how much each ingredient in your restaurant costs you. But do you know how much each menu item costs? Calculating Plate Cost can help you set your menu prices, calculate inflation impact and evaluate promotion profitability. Learn how to calculate Plate Cost and download our free Plate Cost Calculator Worksheet with bonus Plate Cost Percentage calculator.
Topics: Restaurant Operations, Restaurant Finance
With changes taking effect across the restaurant industry in response to COVID 19 (full business shutdowns or limited operations), I'd argue that if you pivoted and changed direction and now offer online ordering, delivery and curbside pickup, then understandings around operational execution, while always very important, are even more critical. Visibility into and clarity around that execution is necessary to your long-term success.
And that visibility comes from your ability to transform your data into actionable information which, in turn, delivers clarity for you and your team.
Topics: Restaurant Marketing, Restaurant Operations, Restaurant Performance
Everyone has likely heard about the dramatic impact the Covid pandemic has had on restaurant sales. In March, it was common for restaurants to have lost 70% or more of their sales from 2019. Since then, we have all been monitoring the progress of sales returning to restaurants. One tool for monitoring the restaurant industry is the Mirus Index which allows us to examine trends daily across thousands of restaurants. Index tracks both sales and traffic patterns for each location, and the trends for both of these metrics leads you to some interesting questions. Have you been tracking both your sales as well as your traffic? Do you see any differences in each metric's trendline?
Topics: Restaurant Profit, Restaurant Operations, Performance
Heading back to School!
I hope you continue to be safe and avoid the virus. Data shows us the virus will find the soft spots in our country to flourish, and that the areas affected move around a lot. Currently, many mid-western states are seeing cases and hospitalizations going up, while they are going down in other areas.
A big, new wild card in the equation is students going back to school. While that may be of concern as it relates to potential increases in cases, the past month has introduced other events that have weathered well. For example, the NBA, MLB, PGA, MLS and other sports have resumed their seasons. While there have been some games postponed due to infections, my impression is that those leagues are doing better than some had expected. I hope the same will be true for the schools.
A coincidental event to the return to school each year is Labor Day. And, after a summer of slow but steady improvement in restaurant sales and traffic, the holiday created a bit of optimism with the volume of business that restaurants experienced. Before we get into the most recent holiday, let's review where we've been.
Covid Impact Recap
Mirus Index, which is a same-store comparison to the same day last year, is stuck around -20%. This means that, on average, a Mirus client location that is open today is generating about 80% of the sales it had last year. It is important to keep in mind that this is the average, and averages can be misleading in both directions. For example, more than half of our clients are experiencing sales that are better than -6%. But for others, the impact of Covid has been far more dramatic, with sales hovering around -50%, or worse in a few cases.
Topics: Restaurant Profit, Restaurant Operations, Restaurant Finance, COVID-19 Restaurant Impact
Dog days of summer
First off, I hope you continue to be safe and avoid the virus. As this pandemic continues, the rate of spread is increasing in many cities around the US. However, the percentage of the US population that has come into contact with the virus was estimated to be no more than 7-8% by the CDC this past week. So, there are a whole lot of us that are unprotected from the virus.
And now for the bad news....
Topics: Restaurant Profit, Restaurant Operations, Restaurant Finance, COVID-19 Restaurant Impact
What Was Ever Certain?
The ever-changing situation surrounding COVID 19 is unprecedented and for many it's a time of uncertainty and great concern. Reading this or similar comments in numerous articles, LinkedIn posts and Twitter feeds has made me ask, is there such a thing as certainty in our uncertain world?
I suppose, in certain limited and controlled situations it's arguable that it exists. Heck, the definition of certainty even says it exists; "a fact that is definitely true or an event that is definitely going to take place”.
My observation of certainty is that many of us, myself included, expect things will go the way we’ve come to expect (the same old routine) day in and day out, and we take comfort in our belief in this certainty. Therefore, certainty is a way for us to feel in control - to believe that things are going to unfold in a certain, predictable way.
Topics: Restaurant Operations
Happy 4th of July!
Since my last post, we have had Father's Day and the 4th of July, and a whole lot of mis-direction by Governors. Sales and traffic continue to improve week to week, but there is now regular volatility in the numbers. I believe this is an indication we have gotten back the low hanging fruit, and getting higher levels of sales may take a lot longer.
Father's Day had been the best sales day since the pandemic started. Mirus Index shows sales down less than -18% from the same day last year; by far the best to date.
Topics: Restaurant Profit, Restaurant Operations, Restaurant Finance, COVID-19 Restaurant Impact
Memorial Day Hangover?
Memorial Day in 2020 fell on the earliest date it can be according to the calendar. And, given the softening of restrictions on restaurants in the two weeks leading up to the holiday weekend, it is no surprise that Memorial Day was a big hit! Sales jumped over 16% over the previous Monday, but was still down -45% from last year.
You hear how numbers can be lead you to the wrong conclusion if not understood. An example of this is illustrated in the chart above on the day after Memorial Day. The chart shows sales were down -3.42% from the previous Tuesday, but what it doesn't show is that May 26 was the best day for sales compared to last year since the pandemic began. The sales this year were only down -41%, meaning the industry had almost 60% of the sales it had last year. That is good news.
Topics: Restaurant Profit, Restaurant Operations, Restaurant Finance, COVID-19 Restaurant Impact
May 11
Thanks Mom!
Every mother loves Mother's Day; a day for them to be recognized and if they are lucky, pampered.
In this Covid-19 world, it also gave a boost to restaurant sales. Traditionally, Mother's day treats restaurants well, and for some it is one of the busiest days of the year. This year, sales at restaurants increased over 44% from the previous Sunday (May 3). And, it's not like May 3 was a soft day; the sales for that day were almost 10% higher than the previous Sunday.
Total sales volume (not SSS) on Mother's Day was also more than 50% of last year's Mother's Day, a milestone celebrated by many. As an industry we have come a long way from a few weeks ago when aggregate sales were down over 70%. It may take some time for sales to fully recover, but the evidence over the past six weeks shows a steady week by week improvement.
Topics: Restaurant Profit, Restaurant Operations, Restaurant Finance, COVID-19 Restaurant Impact
May 1
Does anyone else sense that time is flying even faster than usual? You may not have this distorted sense of time if you are working from home, or laid off, but it is already May. Some thought at the start of this pandemic that all would be normal at this time. Seems like a silly, optimistic projection today, and we still have no clear picture on how the next several months are going to play out.
For those following this diary, I'd like to say thanks. And, if you have any thoughts or ideas you think would be constructive to our audience, please leave your comments at the bottom of this blog, or email me at dave@mirus.com.
Positive events continue to be revealed. Last week, the sales trend data indicated that we might have hit a bump in the road. Since then, the growth of restaurant sales has continued in a steady fashion. Here is the Mirus Index by Day for the month of April compared to the same day from the Previous Week. Easter is the first thing you might notice. There are two anomalies related to Easter, the week it fell on last year, and the week it fell on this year. The large negative is Easter this year, and the spike is the following Sunday when this year is compared to a weak Easter last year. Keep in mind these are same-store calculations, so a restaurant has to be open this year and last year to be included in these numbers.
Topics: Restaurant Profit, Restaurant Operations, Restaurant Finance, COVID-19 Restaurant Impact