10 ways to use technololgy to control costs

EPOS & business management solutions for growing enterprises

© GS Systems 2013

10 ways to use technology to control your costs!

• Gross profits can be 5-10% higher than the national average• Recipe controls save precious resources and boosts your margins by 2-6%• Staff management monitors your greatest single cost


Contents

© GS Systems 2013 P.2

Page 3 - Cost control is a critical determinant of business profitability.Page 4 - Positive growth - but only if costs are controlled!Page 5 - Good News - Bad NewsPage 6 - Procedures Page 7 - Cash ControlPage 8 - Stock ControlPage 9 - Supplier PurchasingPage 10 - Recipe ManagementPage 11 - Labour & Staff ManagementPage 12 - DuplicationPage 13 - Automated ReportsPage 14 - Customer RewardsPage 15 - IntegrationPage 16 - Value of trainingPage 17 - Max Suite



Kate Nicholls, Strategic Affairs Director, Association of Licensed Multiple Retailers, speaking at the

launch of the 7th Annual Benchmarking Report.

Now the average cost of running the average pub has jumped to just under half of turnover for the

first time in four years there’s never been a better time to really get a grip on your costs.

“Cost control is a critical determinant of business profitability.”



The hospitality industry is showing all the signs of a return to healthy growth after the twin difficulties of recession and lack of consumer confidence.

That’s the clear message of the Association of Licensed Multiple Retailers’ 7th Benchmarking Survey, published Autumn 2013.

The report’s author, the ALMR’s strategic affairs director, Kate Nicholls, says the news is good across all key performance indicators such as business performance and operating costs. And applies to every trading styles as they all report positive growth.

Payroll costs are up, revealing employment and job creation is back on track. Investment in the sector is up too, returning to pre-recession levels. Like-for-like sales are trending upwards, climbing by 5.8% in the year to October 2012. Capex has doubled to over 5% of turnover in the past 12 months. However, Kate warns the good news of market stabilisation has to be tempered by an increase in operating costs, which have risen for the first time in four years.

Controlling costs are crucial to business profitability. You know this from running your own businesses!

Supporting evidence comes from supply chain consultants Prestige Purchasing who says food and drink inflation will be running at around 4.5% in 2013 while research contained in Horizon’s biannual ‘Menurama’ report claims UK restaurants and pubs have raised their menu prices by 6% in the last year.

Fortunately, hospitality operators can control their costs through the smart application of EPOS technology and business management solutions. If you have full visibility of what’s happening within your operation, you can monitor and manage far more effectively.

Here I am delighted to reveal 10 ways you can use technology to get a grip on your costs. If you want to know more, simply get in touch. Call us on 0800 655 6264.

Niels NielsenManaging DirectorGS Systems

Positive growth - but only if costs are controlled!



Good News

Good News

Bad News

Capex is up more than 66% as operators invest in their brands, people, offering and technology.Like-for-like sales are trending upwards, climbing by 5.8% in the year to October 2012.

10 ways technology can help you today.

The average cost of running an average hospitality outlet has increased, standing at 48%, an increase of 3% from the previous survey



Technology is only as good as the procedures embedded within it.

1. Procedures Technology is a major capex investment.

A return is only achieved when watertight procedures are embedded within your EPOS and business management solution.

Procedures enable you to constantly see the cash and stock flow through your business.

Procedures also help you benchmark and measure your operational performance.

All transactions, purchases and stock movements are transparent, trackable and traceable.

With them you know everything that happens in your business.

You always have a full audit trail of the cash you invest and the stock you use.

Procedures embedded within your solution eliminate operational loopholes and protect your business, giving you genuine control over your costs.



2. Cash Control

100% accountability ensures you keep cash under strict control.

Automated cash reconciliation, using electronic business sheets, balances your system’s data flow with the cash, cheques, credit and debit cards and promotional vouchers declared and banked by your managers.

Comparing the ‘bank’ with your electronic result enables you to spot and explain discrepancies between the two.

Watertight cash reconciliation ensures you and your managers have to account for every transaction taking place within your operation, no matter how many sites you have.

Focusing on what’s actually been declared with what should have been banked prevents figure ‘fudging’.

Pinpointing discrepancies real-time dramatically improves your ability to control your costs.



3. Stock Control

Stock control safeguards resources and benchmarks your business.

Regular electronic stock control audits allow you to benchmark and monitor your business performance.

Identify potential problems immediately before they escalate and play havoc with your costs.

Stock audits provide the data platform for your business management solution to produce accurate gross profit margins across all aspects of your operation.

Running regular daily line checks and weekly full stock audits ensure you see a true reflection of your business at all times.

Contrast this technological approach to relying on external auditors carrying out a manual monthly or quarterly stock take when it is too late to take action.



4. Supplier Purchasing

Electronic supplier purchasing controls spending and highlights discrepancies.

Electronic supplier purchasing allows you to use your EPOS solution to automatically place orders at pre-defined product levels.

Orders can only placed with registered or approved suppliers who sell at pre-agreed prices.

Once an order has been sent, its progress can be tracked through the EPOS solution from placement to fulfilment.

This process avoids overstocking and overcharging as stock and price discrepancies are highlighted.

Automating supplier purchasing gives you price consistency across your operation and full supplier visibility, ensuring you can make better informed buying decisions and have greater control over your supplier costs.



5. Recipe Management

Integrated recipe management can reduce costs by 2 to 6 %.

Integrated recipe management compares stock and purchasing data so you know your wet and dry recipe costs are always up-to-date and your margins accurate.

You’ll also be able to immediately pinpoint discrepancies caused by excessive portioning or unnecessary wastage.

Traditionally, many businesses used Excel spreadsheets, a long-winded and often inaccurate manual process, or simply compared the two in isolation from each other.

Using technology to integrate stock and spending data flows can add between at least 2 to 6% to your gross profit margins.



Staff wages, your biggest single variable expense, are rising.

According to The ALMR’s 7th benchmarking report, the average increase of wages costs as a percentage of sales has risen from 25.1% to 25.4%.

Fortunately, you can use technology to put in place simple measures to benchmark and monitor labour costs.

Your EPOS business management solution can be configured to tell you on a daily basis what your staff costs are as a percentage of sales for your entire operation or by each cost centre.

If the percentage ratio is too high, staffing levels can be reduced and cost savings made. Future staffing rotas can also be planned using historical and forecast data to ensure you keep a tight rein on your biggest variable cost.

Despite payroll costs increasing, technology can help manage and control them.

6. Labour & Staff Management



There are no short cuts to setting up an EPOS and business management solution but investing the time upfront will provide you with huge future benefits.

For instance, once your system is operational, data at the point of sale or purchase only needs to be entered and recorded once.

The data is now able to flow freely from your sites to your head office and your accounting systems.

Information can be accessed and actioned by the board or finance, HR, marketing and operational departments.

With modern technology literally at your fingertips, the days of each department inputting the same data and incurring unwarranted duplication costs are redundant.

Technology tools allows data to flow from the POS to head office.

7. Duplication



Technology gives you immediate access to real-time bespoke reports, whenever and wherever you need them.

The data flow captured by your EPOS business management solution is automatically interpreted and published as key performance indicators or more detailed reports.

Viewed on a weekly, daily or even hourly basis, KPIs show your current performance, identifying gross profit margins (the money you’re making) and staffing costs (your most expensive variable expense).

Core KPIs are complemented by standard and bespoke reports depending upon your individual needs.

Automated reports generated to your requirements when you want them.

8. Automated Reports



9. Customer Rewards

Engage and target real people at the point of sale and beyond.

Technology creates numerous opportunities to personally engage and reward your guests.

Add value to your relationship with them and thank them for their loyalty.

Integrating customer databases into your solution enables you to identify guests at the point of sale.

And create openings for extra ‘buying’ opportunities. Engagement is ongoing and personal.

Digital communications means you can devise, distribute and track customer relationship activities through your solution.

Reward technology is a far more cost-effective and less wasteful than traditional print-led marketing activity such as press advertising, direct mail and leaflet drops.



Remember when operators used different systems within the same premises?

One for EPOS. One for reservations. Another for loyalty.

All operating independently from one another?

Those days and associated costs are gone.

API integration enables EPOS business management solutions to seamlessly interface with other applications.

Data flows seamlessly between customer relationship management programs, accounts packages, conference/event management systems, hotel front desk, restaurant table reservation solutions - or any other specialist software module, ranging from snooker table and bowling lane management systems to recreational centre solutions and e-commerce.

Integration allows seamless data flow between different applications.

10. Integration



I trust you found reading our ’10 ways to use technology to control your costs’ guide informative.

Hopefully, we’ve given you plenty of food for thought about how you can apply technology to your business.

There is one more point I’d like to make about the importance of training and implementing technology.

Did you know that according to statistics produced by Gunter and Amazon.com 57% of people who buy software never use it? And 83% of people who start to use software, never use it again?

That’s why it is really important all your front of house staff and managers receive EPOS and technology training (with regular updates and refreshers).

Experience shows us that when people are trained well, they are far more confident and knowledgeable with the tasks and challenges they face. Both front of house and in the back office.

Knowledge and understanding empowers them to perform to higher levels than untrained peers - and ensure widespread cost efficiencies throughout your operation.

Niels

Experience shows us that when people are trained well, they are far more confident and knowledgeable with the tasks and challenges they face.

Training



GS Systems provides powerful, fully automated EPOS and business management solutions for operators serious about growth.

Our solutions combine best-of-breed hardware and versatile bespoke MAX suite software configured to the exact requirements of our clients. Our technology is complemented by sector-specific added value advice based on our experiences with many of the UK’s leading brands.

The MAX Suite is our own evolving modular, fully-scalable software suite designed to streamline complex business operations, improve efficiencies and add value for everyone involved in the growth of a successful enterprise.

MAX POS is the core module for all our EPOS-led business management solutions. Easy for staff to use, transactions are quick with short cuts for popular items for even greater speed.

Extremely functional and flexible, MAX POS records and tracks everything from sales and stock and to reservations and deposits and staff hours. MAX POS can be used on EPOS terminals and handheld devices as well as iPads for complete operational flexibility and mobility.

MAX GP helps monitor and analyse business performance - and provides all the necessary business intelligence to control costs and grow margins.

Using MAX POS and MAX GP together is the perfect platform for future growth.

But there is much more to the suite.

Additional MAX modules, such as rewards, alerts, reports and reservations, gives clients all the essential technology tools to genuinely take complete control of every aspect of their businesses.

Growth & Profitability

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GS Systems 119/121 Buxton Road Stockport Cheshire SK2 6LR

[email protected] Tel: 0800 655 6264

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10 ways to use technololgy to control costs