Ed Heskett
Blog, Operational efficiency

Pi Day, or March 14th, is usually about discounts on pizza and apple pie. But today, we want to talk to you about a different kind of pie — one that’s far less tasty.

Franchisees can get “Pi” in their face when they’re too focused on the wrong metrics or when they misinterpret important data. Let’s keep your face pie-free this year by looking at 3.14 misleading QSR metrics you should be paying attention to.

1. Deletions/voids/cancels before total

Why would this be misleading to franchisees? The issue isn’t that the data isn’t useful or good. The problem is the way that many franchisees interpret the data.

Ideally, this metric should only be 3-5% in your POS. Once it approaches 7%, you’re most likely dealing with theft. Some people think it’s impossible to steal that way. But, I recently found a $2,900 theft for a client by looking closely at this metric.

2. Ideal cost of sales

This metric can be misleading, but it’s very important to track because it can uncover unexpected costs and inventory variances. But, it’s only useful if you have accurate inventory numbers.

Personally, I’m a proponent of counting the top 6-10 most expensive items so that you minimize variance where it matters most. Again, variances are only as good as the counts are accurate. This means that the cost of sales metric is valuable if the counts are accurate, but misleading if not (which happens frequently). Really nailing these critical inventories will make it easier to catch variance and avoid losses.

3. Drive-thru sales as a percent of total sales

This is a stat that’s really easy to get lost in as an owner or operator. Some might boast about 74% of their sales coming from the drive-thru. But, is this a good reason to focus your energy on making more drive-thru sales?

This number can be misleading because of the way restaurants operate. Many will have their drive-thru open much later than their dining rooms, which can inflate the number. This is important, since it can affect how you schedule employees, too. You don’t want to prioritize drive-thru service and leave people in the dining room with a poor customer experience.

3.14. Beverage sales

This one is actually not as misleading as much as it is an important metric to pay attention to. A great rule-of-thumb for beverage sales is that they shouldn’t be less than 14% of overall sales. Overall beverage sales are something that every QSR owner should be looking at. Beverages are easy to sell and highly profitable, so if your beverages are below the standard 14-17% of overall sales, then you’re missing out on opportunities for easy profit. Try bumping up this number with special offers and training your employees at the register.

Don’t get pied this year

If you’re paying attention to these metrics, then you won’t be misled. Approach them the right way to ensure a boost in business and reduction in loss. As you enjoy that discounted slice of pizza or pie, rest easy knowing that you’re analyzing the data correctly.

New Call-to-action