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With 60% of restaurant owners closing down after the first year and 80% of restaurants not making it past the five-year mark, this is one of the toughest businesses to succeed.
The only way to stay competitive is to have a clear understanding of your restaurant’s performance.
The most successful restaurants have a system in place when it comes to measuring KPIs and they know exactly which areas they have to improve to stay ahead of competitors.
And while different managers focus on different performance indicators, there are some general restaurant KPIs that most keep track of.
In this report, we’ll go over the top restaurant KPIs every restaurant owner should measure and show you how to create an all-in-one dashboard that will help you stay on top of the data.
At its core, KPIs are all about measuring performance.
And restaurant KPIs are specific metric sets that help owners and managers track and evaluate the performance of their restaurant business.
Restaurant KPIs can be used to measure everything from financial performance to operational efficiency, customer satisfaction, and employee productivity.
Over time, you will gain valuable insights into how well your restaurant is doing, where you’re succeeding, and where you need to make improvements.
But not all restaurant KPIs are created equal.
It’s important to focus on those that are relevant to your specific restaurant and its goals.
For example, a fast-food restaurant might prioritize table turnover rate and order accuracy, while a fine-dining restaurant could focus on guest satisfaction and sales per guest.
Running a restaurant can often be overwhelming and a lot of managers postpone measuring KPIs due to incredibly busy daily schedules.
But if you want to truly understand how your restaurant is performing, there really is no better way.
Here’s how you can set up and measure restaurant KPIs:
Related: KPI Development: 13 Tips on How to Create KPIs That Reflect Your Strategic Priorities
There is a long list of restaurant KPIs that managers can track, but you need to narrow it down. If you start to cover each one, things can get complicated fast.
We’ve categorized restaurant KPIs into four major categories:
Focusing on the restaurant’s sales and revenue is a primary focus for many managers that are just starting to track KPIs.
The sales category is broad and it can branch out to several types of KPIs, but the most important thing is that you’ll get an overall picture of your restaurant’s sales performance.
Examples of sales KPIs include sales per guest, customer count, total revenue, average payment amount, cost of goods, cash flow, labor cost percentage, and more.
Sales KPIs will give you the big picture of your total revenue, but they don’t show you how profitable your restaurant is.
For this insight, you should track profitability KPIs such as net profit margin, gross margin, food cost percentage, contribution margin, operating margin, occupancy cost, and more.
Profitability KPIs help you make data-driven decisions to improve the bottom line.
Did you know that 94% of customers will choose a restaurant based on online reviews?
Customer satisfaction has never been more important and even a few bad reviews on Google could lead to a decrease in revenue for your restaurant.
Treat every customer like they’re Gordon Ramsey in disguise and the reviews will follow.
In terms of customer KPIs, some of the most commonly tracked ones are repeat customer rate, customer satisfaction score, net promoter score, online ratings, wait time, complaint resolution time, food quality score, etc.
Related: 20 Customer Service Statistics to Help You Deliver a 5-Star Experience
Lastly, you want to monitor the efficiency and productivity of your restaurant staff.
There are several different ways you can do this, but the most popular productivity KPIs are employee turnover, table turnover rate, server sales per hour, employee absenteeism rate, and productivity per hour.
Tracking KPIs like sales and profitability is typically a straightforward process, but managing the staff can be a bit more complicated.
By tracking these KPIs, you’ll have a better idea of how productive your employees are and whether you need to make any changes to boost productivity.
There are hundreds of restaurant KPIs you can report on, but focusing on all of them is counter-productive.
You want to zero in on the ones that can currently have the biggest impact on your business – the best practice is to prioritize 5-8 metrics in one dashboard.
Here’s a general list of some of the most popular restaurant KPIs that managers track:
Not sure which metrics to track or dashboards to build? Have old reports you want to recreate in Databox? Share your dashboard needs with one of Databox’s product experts and we’ll build you a customized dashboard for free.
Here is an example of what your dashboard can look like… (just imagine your data populating here)
And here’s another one…
We get it. You may not have the time to build out the perfect dashboard before your next meeting.
Luckily, we do.
Connect with someone on our team, share the metrics or areas that you need to track, and we’ll build your dashboards for you in just 24 hours.
Learn more about our free dashboard setup here, reach out for assistance via email or chat, or book a call.
Cost of Goods Sold (COGS) is a metric that represents the direct costs incurred by your restaurant business to produce the goods sold to customers.
In other words, it shows you how much you spend on supplies and ingredients for your menu items.
It also captures the labor costs needed to create the sellable product and other direct costs like packaging and delivery.
Overall, decreasing the cost of goods sold (without sacrificing quality) is one of the best ways to increase your restaurant’s revenue.
Here’s a formula you can follow to calculate this metric:
COGS = Beginning Inventory + Purchases during the Period – Ending Inventory
For example, let’s say that a restaurant starts the year with $10,000 worth of food inventory, purchases $50,000 worth of food during the year, and ends the year with $8,000 worth of food inventory.
Using this formula, we find out that the restaurant incurred $52,000 in direct costs to produce the food sold to customers during the year.
Gross Profit refers to the amount of revenue generated by a restaurant minus the direct costs associated with producing and delivering the goods or services.
It’s the profit that a restaurant makes after deducting the cost of goods sold, managers use it to measure efficiency and profitability.
The formula you can use is:
Gross Profit = Total Revenue – Cost of Goods Sold (COGS)
Let’s say that a restaurant generates $100,000 in revenue a month and has COGS of $40,000. Using the formula, we can calculate that the restaurant has a gross profit of $60,000.
A high gross profit indicates that the restaurant is generating more revenue than it is spending on direct costs, which is a positive sign for the business.
However, it’s important to note that it doesn’t take into account indirect costs such as rent, utilities, and labor costs, so it should be used alongside other financial metrics when assessing the overall financial health of a restaurant.
Average Table Occupancy measures the percentage of tables occupied during a given time frame.
It’s a good way to assess your restaurant’s popularity and performance, but it’s also an important indicator of a restaurant’s operational efficiency.
You can use it to precisely determine the restaurant’s capacity utilization, customer demand, and revenue potential.
Here’s the formula to calculate average table occupancy:
Average Table Occupancy = (Number of Occupied / Total Number of Tables) x 100
So, if a restaurant has a total of 50 tables and 40 of those tables were occupied during dinner service, the ATO would be 80%.
High table occupancy means that the restaurant is effectively utilizing its available space and maximizing revenue potential.
Spend per Head measures the average amount of money that each customer spends during their visit to your restaurant.
It’s a useful indicator of a restaurant’s revenue potential and can be used to track changes in customer spending patterns over time.
Here’s the formula:
Spend per Head = Total Revenue / Number of Customers
For example, if a restaurant generates $5,000 in revenue from 100 customers, the spend per head is $50.
There are numerous ways you can increase spend per head, like adjusting your marketing strategy, changing menu pricing, or improving overall customer experience.
Food wasted refers to the amount of food that is discarded or wasted in a specific time frame.
This can include food that is left uneaten by customers, spoiled or expired food, and trimmings or scraps from food preparation.
The formula for calculating food wasted is:
Food Wasted = Beginning Inventory + Purchases – Ending Inventory – Sales
For example, let’s say that a restaurant has a beginning inventory of $10,000 worth of food, purchases $5,000 worth of additional food, has an ending inventory of $8,000 worth of food, and generates $12,000 in food sales.
In this scenario, the restaurant had $5,000 worth of food wasted during the period.
Food waste is a significant issue for restaurants as it not only represents a financial loss but also has a negative impact on the environment.
Restaurants can implement various measures to reduce food waste, such as closely monitoring inventory levels, adjusting portion sizes to reduce leftovers, and finding alternative uses for food scraps and trimmings.
The break-even point is a financial metric that measures the minimum level of sales required for a business to cover its total costs and begin generating a profit.
In other words, it represents the point at which a business becomes profitable.
The formula for calculating the break-even point is:
Break-Even Point = Fixed Costs / (Price per Unit – Variable Costs per Unit)
Let’s say that a restaurant has fixed costs of $10,000 per month and its average price per meal is $20. The variable costs per meal, including ingredients and labor, are $10 per meal.
In this case, the restaurant needs to sell 1,000 meals per month to cover fixed costs and break even.
The break-even point is a crucial metric for restaurants as it helps them to determine the minimum sales volume required to sustain their operations and make informed decisions about pricing, marketing, and cost management strategies.
When properly tracked, the break-even point helps restaurants can set realistic revenue targets, track their financial performance, and make adjustments to their operations to improve their profitability.
The best way to manage KPIs and metrics – and this applies to any type of business – is to have them neatly organized.
This is especially the case in fast-moving restaurant businesses where owners and managers are juggling dozens of high-priority tasks during the day.
You can spend fewer hours going through each KPI and metric manually by simply connecting your data to a dashboard.
Here are some of the popular dashboard templates for restaurant business owners:
This Revenue Overview Dashboard example is designed to provide managers with full insight into the business’s cash flow, revenue, bank account data, expenses, and other financial metrics.
You’ll have all of this data in one place, allowing you to check out financial details at a glance and see how you’re progressing toward quarterly/yearly targets.
The main things you’ll learn are:
This dashboard template has one-click integration with QuickBooks, but you can pull data from other popular accounting software in our 70+ integrations.
And if you use QuickBooks and HubSpot in conjunction, you can connect your most important data from both software into the Financial Performance Dashboard template.
With crucial KPIs from both metrics in one place, you can quickly identify any issues that can negatively impact your restaurant’s cash flow and turnover.
Sales pipeline, cash flow forecast, budget, income and sales by customer… everything you need when it comes to financial metrics and sales in a single dashboard.
If you run Google Ads campaigns for your restaurant business, one of the easiest ways to stay on top of key metrics like clicks, impressions, conversion rate, and others is to use this free Google Ads Dashboard.
Once you pull out the data from your Google Ads account, you’ll discover:
And if you want to check how other restaurants and food industry businesses are performing when it comes to Google Ads, you can benchmark your metrics against them by joining our free Benchmark Group.
The Restaurant SEO Dashboard is designed to help you track website engagement and traffic metrics from Google Analytics 4, like bounce rate, average time on page, unique visitors, average session duration, and more.
You’re getting a detailed overview of your website’s performance without the hassle of digging around for data in tools and spending countless hours tying it up together.
Some of the main you can do are:
If you want to check out your team performance KPIs, sales pipeline data, progress towards monthly goals, and other sales-related metrics, you can use the Restaurant Sales Dashboard.
This dashboard template can help you pinpoint which parts of your restaurant are successful and where there is room for improvement.
Some of the key things you can track include total sales, productivity KPIs, sales performance KPIs, progress vs. goal, and more.
Facebook, LinkedIn, Instagram, Twitter… no matter where you advertise your restaurant, tracking your most important social media metrics can be too time-consuming – especially if you use multiple channels.
If you want to connect your social media metrics in one place and quickly check out whether your marketing efforts are paying off, you can download the free Social Media Accounts Performance Dashboard template that uses data from Facebook Pages, Instagram Business, LinkedIn Pages and Twitter.
This dashboard will help you:
Running a fast-moving restaurant business is usually a race against time and you have to juggle dozens of responsibilities throughout the day.
And if you don’t have any real-time insights into how you’re business is performing, it’s hard to know which tasks you need to prioritize.
In such a fast-paced environment, managers don’t usually have any spare hours that they can spend on manually tracking data, pulling it out of analytics tools, organizing it in spreadsheets, analyzing it separately, etc.
Dashboards can cut this time in half.
Actually, scratch that, they can help you do it in 5 minutes – especially if you use Databox.
Building a restaurant KPI dashboard in Databox literally takes just a few minutes. All you have to do is choose a template, connect your data source, and drag and drop the metrics you want to focus on.
We have 100+ integrations and 4,000+ metrics available.
And if even this doesn’t fit your busy schedule, you can contact our free customer support and explain what kind of dashboard you need – we’ll have it ready for you in 24 hours.
Sign up for a free trial and let us help with the data while you manage the restaurant.
Hey, we’re Databox.Our mission is to help businesses save time and grow faster. Click here to see our platform in action.
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At Databox, we’re obsessed with helping companies more easily monitor, analyze, and report their results. Whether it’s the resources we put into building and maintaining integrations with 100+ popular marketing tools, enabling customizability of charts, dashboards, and reports, or building functionality to make analysis, benchmarking, and forecasting easier, we’re constantly trying to find ways to help our customers save time and deliver better results.
Filip Stojanovic is a content writer who studies Business and Political Sciences. Also, I am a huge tennis enthusiast. Although my dream is to win a Grand Slam, working as a content writer is also interesting.
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