If you run or are in charge of a retail or F&B outlet, you are familiar with having a Point of Sale system to capture your sales data. But are you making the most of the data captured in your system? If you have not yet been deep diving into your data, here are some basic key metrics you can start tracking to gain more business efficiency:
What are the best selling products? Are there seasonal products or do they remain consistent? Which products move very slowly or are not moving at all? These are the products that eat up your inventory cost unnecessarily. For F&B, if they are perishable items, the cost of storage will go up as the slow moving items eat space and also go bad. Axe the slow moving items wherever you can, or use the trends you gathered to reduce supplies accordingly.
What are the transaction trends? On which days are sales highest, and which days are they lowest? Are monthly sales higher or lower than your average? Is your labour scheduled to the transaction volume trends to deliver the optimal customer service levels? Labour costs are one of the highest operating costs for business. Scheduling your labour according to peaks and troughs will save you a lot of cost wastage and bring profits up.
Revenue Per Transaction:
What is the average spend per transaction? Which days, and hours bring in the most sales volume? Which ones bring in the least? Has average spend decreased? If so, what could be the reasons? Are customers confused by too many options? Too few options? Deep diving into the trends of your data can help you flag out some correlations. For example, perhaps the decrease in revenue per transaction occurred after the menu was revamped.
Items Often Transacted:
Which products are often purchased? If there are key items that sell well, optimizing your promotion materials and menu to showcase these items can create an additional sales boost. Are there common pairings – for example, whenever a beef steak is ordered, customers also tend to order a red wine? Cross-selling frequently ‘also-bought’ products can create an additional sales boost.
Armed with the data, you can plan a much more effective marketing program and to attract and retain more customers. You can also streamline business operations to achieve operational excellence. Once you start ‘listening’ to your POS data, you will find gems to unlock profits through revenue growth and lower operating costs for your business.