Business Insights

The Math and Mindset to Grow Sales

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You want to grow sales. It’s a never-ending desire and necessary to secure success and create greater opportunities.

Wanting isn’t enough. Hope is not a tangible or tactical action. You have to be willing to do the math and adopt the mindset that because every customer visit is a sales building opportunity, customer behaviors must be counted and measured!

The good news is that is easier and less expensive to grow sales with your current customer base (no matter how big or small) than it is to increase sales by attracting new customers.

Growing sales today AND tomorrow happens when you focus your energy and efforts on two things:

  1. Increasing the average amount of dollars and cents each customer spends (aka the check or transaction average)
  2. Growing the average amount of customers or transactions by daypart or revenue stream each hour, day, week, month or year (aka the customer or transaction count)

More good news…both can be accomplished at the same time with customer engagement – be it in person or online.

The Math

There is a simple math equation restaurants live by:

Customer or Transaction Average x Customer Count = Sales

Begin by understanding your current numbers and customer behaviors. How many customers do you average, when and how do they come in, and how much does the average customer spend each time?

As a best practice, transaction averages and customer counts should be regularly analyzed over specific time periods including hour, day, week, month, year and daypart (point of sale systems are typically programmed for this type of reporting). Counting by hand and calculating with an Excel sheet works too!

The goal is to identify benchmarks that identify when and how much business is coming in and through which revenue stream – walk-in, online, pick-up, delivery, catering and retail. Comparisons should then be made based on the same quantifying information from similar prior periods and dayparts. In other words, you have a way to measure the merit of your actions with results.

After analyzing those numbers, a starting point is established and the real work begins – determining how to increase the Transaction Averages and Customer Counts. It all starts with adopting the mindset for growth.

The Mindset

The term customer actually includes three varieties: the “regular” customers you see, the “potential regular” customers you don’t know (people you meet on their first visit) and the “regulars or potential regulars” you cannot see (accessing your establishment through alternate revenue streams or social media).

The goal is to increase the amount each customer spends and increase the number of total customers (with “new” customer identification and acquisition) or the average number of transactions each customer makes.

Increase Transaction Average

There are two ways to increase transaction averages – charge more and sell more.

To charge more or increase prices, it is best to use product mix (P/MIX) and food cost data to identify both the need and opportunities to increase prices based upon profitability and popularity. From there, strategic price increases can be made by entrée, category or high value/value-added ingredients used. But, beware of broad-brush price increases that could cross the value threshold and put customer counts at risk. For price increase to solve your sales woes, you need consistent customer counts!

To sell more, increase awareness and easy access to D.A.D.S.– drinks, appetizers, desserts and sides or value-add modifications to the transaction or entrée. Unique ingredients, adding or doubling a protein or adding a special sauce/dressing/aioli will not only make the customer experience better, they increase the transaction average. Internally, awareness is created by employees making personal recommendations. Via online, it requires programmed prompts and screen flow.

Increase Customer Count

Acquiring new customers is fundamental and the most critical piece to achieving this is through customer engagement – both in person and online.

Increase Number of Visits

Motivating your current customer base to increase their visits can be just as impactful as acquiring new customers. In addition to encouraging customers to return on-site, consider motivating them to try an additional daypart, place an online order for takeout or catering. Invite them to a special event. Tell them about your food truck, ghost kitchen, shadow brand, or sister locations.

Make Every Moment Count

The greatest multiplier for success is customer service.

Welcome back regulars by thanking them for returning and inquiring about past experiences. Knowledge about previous visits helps employees direct the returning customer to new future experiences and revenue streams. For example, if a “regular” comes in for lunch to have chicken wings, invite them back to enjoy them when discounted during happy hour. If there is a loyalty program, ask each returning customer if they are signed up. And, don’t forget the power of thank you. Thanking regulars encourages guests to return.

Identify first-time customers with questions such as “Have I served you before?” or “Is this your first time in?” When a new customer is identified, it’s not only an opportunity to share and show off what you do best and increase the check average, it should trigger a response and reward intended to solidify the acquisition and drive a return visit.

Incent online customers who are accessing the business online or via social media for the first time. Offer a reward for signing up to “keep in touch,” set up an account for contact free payment or join a loyalty program.

Maximize data capture of your online ordering system or application to streamline customers future ordering process, because an easy and positive experience results in a more rapid repeat order or return visit.

Engage with online customers by liking and responding to social media comments and build your audience by following other accounts that align with your business.

Turn good-bye into “see you soon,” with a sincere send off and a tangible reason to return. For example, add a surprise to every check drop or inside every bag that leaves the building. It can be as simple as an invitation to a special event, a bounce-back discount to a specific off-peak daypart, a coupon for a sister location, information about tomorrow’s special, an online order promo code, or a reward for posting to social media.

Remember, even though sales growth is built one customer at a time, no one thing can do it alone. It can only be achieved when you combine the right MATH and MINDSET for success. Contact your Shamrock Foods Sales Representative to learn more.

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