Restaurants fail at an alarming rate. Around 60% fail within the first year and around 80% fail within five years. Grocery stores have it rough too, as the industry is ranked 3rd worst for success rate after the fifth year.
If your restaurant or grocery store is failing or not making the profits you hoped, it may not be too late to turn things around.
And guess what? This doesn’t have to involve drumming up some crazy marketing campaign or throwing together a huge holiday sale.
Just ask Panera Bread, a huge restaurant/cafe franchise with 1,972 locations in 46 states, who was able to increase their same-store sales 4.7% across all units and inch out Applebee’s for the number ten spot in Technomic’s Top 500 Chain Restaurant Report.
What helped them make these big gains? Predictive analytics tools- also known as predictive ordering. It’s a simple solution to a complex problem.
Predictive analytics tools
These work to decrease food waste and, in turn, increase your bottom line.
And you want to know what else is really cool? Predictive ordering doesn’t just help your business, it also helps our planet. Food waste is a major issue in the world today, and restaurants and grocery stores are unfortunately a big slice of the problem.
Ok, so just exactly how do you use predictive ordering? Let’s delve into some different ways you can use these tools to make your business grow:
No More Food Fights
Ever had some quality food you ordered spoil? Or ever had a food shortage and then had to face an angry customer who was dying to have his favorite dish?
You can probably answer yes to both of these questions. Doing food inventory is a huge pain in the rear. It can be really difficult to find that balance between having enough items on hand and being stuck with too many items that eventually spoil.
So, how can predictive ordering help with all of this?
Predictive ordering can be integrated with your point of sales system (POS) to help you break down the exact amount of ingredients you need to order.
A quality predictive ordering system will tell you how many units sold, not just dollars.
Because knowing you sold $600 worth of grilled cheeses last week isn’t very helpful for inventory purposes. But knowing you went through 20 packs of cheese and 50 loaves of bread? That’s helpful.
And what’s even better?
Predictive ordering can help keep track of your irregular sales days that occur due to holidays, weather or promotions. That way when the
Superbowl rolls around, no one’s going to have to be fighting over that last bag of frozen wings.
Would you like fries with that?
Ah, the age old question. But what if there’s some crazy person who doesn’t like fries and wants veggies instead?
Well, with predictive ordering, you can now help sell those lesser known side items to customers who actually want to eat them, but just didn’t notice them before.
Predictive analytics tools can be synced to your online ordering system and can help anticipate what the customer may want based on previous order history.
For example, if a customer orders a veggie burger, the app can then suggest upgrading to a side of steamed vegetables instead of fries, something they may have overlooked on the menu before.
This process can play an integral role in minimizing food waste.
First, the customer no longer has to feel bad about eating a few fries and throwing the rest away.
Second, your establishment will now be able to start recognizing trends in terms of what sides are popular with what entree so they can start upselling those sides to a certain demographic before they start to reach the spoiling point.
Amazon is a company that really pioneered this art of subtle suggestion with their “if you like that, you might like this” technique.
And has it worked?
You bet it has. Amazon is a Fortune 500 global retail empire, and you can bet that predictive analytics played a major role in their success.
Sale! Sale! Get it While It’s Hot!
Ok, so we’ve covered who predictive analytics tools can keep your shelves stocked and entice people to go a little crazy with add-ons while ordering.
But how about getting to the customer before they purchase something?
Anticipating customers’ needs doesn’t just make them feel appreciated, it can help boost sales as well. How so?
Well, let’s say Sarah goes to the grocery store every other Saturday and without fail buys almonds every time.
It would be pretty annoying for her to get an email coupon on the following day offering her a 20% discount on her favorite almonds, right?
She needed that coupon yesterday! Also, Sarah is a vegan, and she’s really sick of opening her inbox to see email coupons for steak.
With predictive analytics tools, these problems can be easily solved.
Data from predictive analytics can help reveal consumers’ most purchased grocery items and how frequently they purchase them.
This way, you’ll be getting those coupons out on time and you’ll know to target Sarah for that huge sale on day old tofu sandwiches from the deli that otherwise would go to waste.
Sometimes You Wanna Go…
Where everybody knows your name…Right? Wouldn’t it be great if you could make all of your regulars feel as welcome as Norm does in Cheers?
With predictive analytics tools, you can! (Don’t worry, though, no name shouting in unison required).
How does this work?
Let’s say Paul frequently comes into your restaurant around 1pm for a meatball sub, even though the line can be super long at that time.
With predictive analytics tools, you can send a message to Paul at quarter to one asking him if he plans on coming in today and if he’d like his meatball sandwich ready when he arrives at 1 pm.
Paul may have been busy with work and not even had that meatball sandwich on his mind. But thanks to predictive ordering- now he does!
This is a great way to make your regulars feel appreciated while minimizing food waste along the way.
Over did it with the chicken wings order because you were expecting a huge turn out for the big game?
How about sending all your regular wing lovers a push notification to let them know about tonight’s half-priced wing special during happy hour?
Got questions about how you can implement one of these solutions in your store or restaurant?
Send us a message, we’d love to hear from you!
And don’t worry, if you’re not fully convinced that predictive analytics is the right solution for your business, you can always do a free trial before committing to a package!