New research confirms what many restaurants know already — supply chain problems are biting hard. But it’s possible to toughen up your defences using tech.
Survey findings just published in Big Hospitality report that 99% of businesses are experiencing supply chain issues. Among them, 88% have faced reduced product lines, 82% have experienced delays receiving items, while 85% have had deliveries fail to turn up.
Researchers also discovered that three-quarters of hospitality businesses said they had no choice but to pass on cost rises to customers by increasing prices (an issue we explored recently around how restaurants can defy the current inflation storm clouds).
Without doubt, supply chain issues pose a significant threat to restaurants. Not only can this result in lost sales and margins, but brand reputations can be damaged. Customers can take their loyalty with them if they encounter rocketing prices and gaps in the menu.
But it’s possible to strengthen your resilience by using Next-Gen restaurant technology.
Here are three ways to do this:
#1: Use tech to manage inventory relentlessly
Increasingly, restaurants may have to treat their inventory more like cash flow. If it all dries up, then it’s time to shut the doors. Inventory is the lifeblood of the business too.
Back in the day, supplies were ordered and received — then customers ate and paid for their meals. Recording the processes in the middle didn’t seem so important, as the money simply disappeared at the beginning and then materialised at the end.
But the latest tech lets you monitor the middle. You can easily digitise and track the status of every ingredient, batch and portion as an end-to-end process. You can follow it in the same way as you’d track Euros, pounds, dollars and any other unit of currency as it flows through your business and appears on your balance sheet.
Next-Gen restaurant tech lets you watch your inventory across your venues 24/7. It’s in real-time too. This visibility is the first step to building your supply chain resilience.
#2: Rethink how you order supplies
Right now, smart restaurants will be thinking how they can create a sensible buffer in their inventory — without slipping into a hoarding mentality, especially when it comes to fast-perishing items. There’s a balance to be struck and Next-Gen tech can help.
With the right tools, you can set acceptable stock levels and watch your inventory like a hawk in real-time. Your managers can see potential problems days or weeks before they threaten to impact your operation. This means you’ve got time to think and act early with ordering — rather than putting yourself under pressure, hanging on for last-minute deliveries that may fail to show up .
Using the right tech, it’s also possible to forecast your needs accurately using artificial intelligence and automate your ordering, so your business doesn’t rely on people having to remember. Your system will also show you the stock held at each of your venues, so you can organise transfers and keep a digital record, should any emergencies occur.
Seeing the big picture of inventory across your entire operation enables you to build greater resiliency into your supplier management. It’s easier to compare and consolidate suppliers based on their price and performance. You can add more suppliers to reduce your exposure levels and negotiate better over price, volumes, availability and delivery commitments.
This can help you to avoid the dangers of paying sky-high prices for ingredients, decimating your margins — because you’ve run out at short notice.
#3: Optimise your menu continually
Over time, more restaurants may begin to realise that analysing and changing your recipes isn’t simply a seasonal activity— it’s part of business-as-usual behaviour, linked directly to profit.
With a Next-Gen system, you’ve the tools to get into the granular detail with every dish you produce. You can see the exact cost, which menu items are most profitable and which are most popular. You can also identify which contain the most “at-risk” ingredients — whether this relates to price, scarcity, or both.
From this data, you may wish to:
- See how far recipes can be tweaked to replace or conserve at-risk ingredients
- Add regular new dishes based on cheaper and more certain supplies, perhaps based on local and seasonal availability
- Create specials from ingredients where you’ve made an opportunistic decision to stock in large quantities, based on price and sudden availability
- Assess how much to raise the price of a particular signature dish if an increase seems unavoidable
- Offset price rises in the eyes of customers by offering companion deals involving dishes created from more plentiful supplies
With the latest tech, you can view the ‘what if’ financial impact of each of these decisions.
Reach new heights of agility
In an industry where virtually everything seems to be changing at speed, restaurants and bars need to switch to Next-Gen technology to stay one step ahead. With iiko, you’ve got the insight, flexibility and agility to respond quickly and confidently in a changing world.