I tell restaurant owners all the time that their POS system is the most important piece of equipment they will ever purchase for their restaurant. The POS system is much more than a glorified cash register; it’s data central. It holds the key data you can use to change your business, prevent theft and make meaningful changes to your operations.
In this episode of my podcast, The Restaurant Prosperity Formula, I review some of the most powerful and little-known reports your POS system has to offer. This includes four underutilized, yet essential, reports that are critical to harnessing the power of your POS system. With only the reports you have at your fingertips in your POS system, you will have the building blocks of informed decision-making so you can lead with confidence, and ensure efficiency, profitability and success in your restaurant.
Four powerful POS system reports
Transfer report: This report is crucial for monitoring internal item movements, revealing patterns that could indicate issues such as staff giveaways or theft. By fostering a culture of responsibility and integrity, you can address potential problems before they escalate.
No sale report: Monitoring the integrity of your cash register is vital. Frequent “no sales” could suggest misuse or potential theft. This report helps reinforce a culture of honesty and accountability among your staff.
Comp report: This report delves into complimentary items, detailing what was comped, why, and by whom. Tracking comps is essential for understanding customer satisfaction, staff discretion, and identifying potential quality issues or excessive giveaways.
Void report: Critical for monitoring errors and potential misuse, the void report highlights the frequency, reason, and responsibility for voids. It helps with early detection of issues such as staff giving away free items or avoiding bills.
More POS system reports for food and labor cost
Next, I explain how to use your PMIX report. The PMIX (item-by-item sales mix) report is a comprehensive tool providing deep insights into your restaurant’s food cost. There are several ways to leverage this report:
The key item tracker for theft detection: Monitor high-cost or high-demand items to quickly identify inconsistencies that may indicate theft or misuse.
Setting par levels: Analyze sales data to identify trends and determine optimal stock levels for each item, balancing customer demand and capital efficiency.
Food cost management: Combine the PMIX report with recipe cards to master your food cost. This analysis helps identify profitable dishes, reduce portion sizes, or change ingredients to optimize costs.
Menu re-engineering: Use the PMIX report to make data-driven decisions for menu changes, optimizing offerings based on customer preferences and profitability.
Integration with food costing software: Integrating the PMIX with food costing software provides a real-time view of ideal versus actual product usage, crucial for pinpointing discrepancies and ensuring kitchen efficiency.
You can also leverage the PMIX report for labor costs.
Beyond sales and inventory, your POS system plays a crucial role in labor management. Peters highlights key features:
Calculating labor cost: Analyze dollars per labor hour worked to understand the true cost of labor in relation to sales.
Efficiency analysis: Track hours worked against revenue to determine labor efficiency during different sales periods.
Spotting time clock theft: Use labor reports to identify potential theft at the time clock, such as employees punching in too early or using incorrect job codes.
Integrating labor data: Combine labor data with other POS reports for comprehensive analysis, providing a bigger picture of how labor directly affects overall profitability.
By tapping into these reports and tools and all the information they offer, you can make informed, data-driven decisions, leading to increased efficiency, profitability, and overall success.
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Read the full transcript.
Hey there restaurant pros. It’s David Scott Peters and welcome to episode 91 of the restaurant prosperity formula. I’ve been coaching restaurant owners since 2003. And the restaurant prosperity formula is based on what the most successful restaurant owners I’ve worked with do on a daily basis to achieve their success. The basic premise of the formula centers around achieving prosperity, freedom from your restaurant that financial freedom you deserve to achieve prosperity, you have to follow a very specific formula made up of leadership systems training, accountability and taking action.
Today we’re diving into a game changer in your restaurant success story, your POS system.
This isn’t just a tool for transactions it’s the epicenter of your operational data.
In the restaurant business data is king and your POS system is the crown jewel.
It’s about much more than bringing up sales. It’s about unlocking the full potential of every aspect of your operation, including labor management. Remember success in our industry is meticulously crafted. Now let’s get started.
I tell restaurant owners all the time that their POS system is the most important piece of equipment they’ll ever purchase in the restaurant.
The POS is much more than a glorified cash register. It’s data Central. It holds the key data you can use to change your business prevent that and make meaningful changes to your operation.
Let’s review some of the most powerful and little known reports your POS system has to offer.
Let’s dive into four underutilized yet essential reports that are critical to harnessing the power of your POS system first.
Transfer report.
The transfer report is a vital tool for monitoring internal item movements.
Imagine a scenario where a high volume item like a steak is simply transferred multiple time between tickets. This could be an innocent mistake. Or it could indicate a more systematic issue, such as staff giving away freebies or worse stealing.
regularly reviewing this report helps you identify such patterns, enabling you to address potential problems before they escalate. It’s not just about tracking inventory. It’s about fostering a culture of responsibility and integrity.
The no sale report. The no sale report is a crucial report for monitoring the integrity of your cash register. Right all cash transactions, the drawer.
This report shows every time the cash drawer is opened without a corresponding sale. Right bring it up. It opens up well in this case you’re hitting no sale. A big red sign says no sale and the drawer opens.
While there are legitimate reasons for doing this, high frequency of no sale could suggest misuse for instance, a bartender might bring up a no sale to siphon cash from the register.
How would they do that? Well, maybe they want to openly steal and so they’re going to hit no sale take money out of the drawer put it in the tip jar. Maybe they’re using it because why? They know they rang up a cash transaction. They didn’t know his cash thought somebody use a card. And when they said they’re gonna pay with cash, they turned around, hit no cell voids the whole damn report. What’s on the screen opens a drawer they give the guest money as if it was changed for what they actually ordered. And they keep track of how much money is in the drawers. So the next time they had no sale, they grab that money and put it in their jar.
By keeping a vigilant eye on this report, you’re not just protecting your revenue. You’re reinforcing a culture of honesty and accountability.
The cop report the cop report is a window into the world of complimentary items, things you give away for free on purpose.
While cons are a part of your business, tracking them is essential. This report should detail well what was common, why it was common, by whom.
It’s not just about preventing abuse. It’s about understanding customer satisfaction, and staff discretion.
For example, excessive comps on a particular dish might indicate quality issue. This level of detail helps you make informed decisions about menu changes, staff training and customer service policy.
Remember that void report I talked about with the no sale? Well, this report would show all those voids.
The Void report is critical for monitoring errors and potential misuse. voids are part of restaurant operations is when you ring something up and it was a mistake Hey run up to burgers but I only needed to have one on the ticket. We take it off that’s a void but a pattern of voids, especially high volume items, or high value items, I should say can be alarming.
This report should well track frequency, reason and responsibility who’s responsible I shouldn’t say for those voids.
It’s a tool for early detection of issues like staff giving away free items. Avoiding bills reduced the total for friends and family or even stealing because somebody paid cash.
It’s also highlights areas where staff might be blocked need additional training to reduce the genuine mistakes.
Now let’s broaden the horizon with the P MC report a comprehensive tool that offers deep insights into your restaurant.
What is the payment report, also known as the item by item sales mix report or Daily Sales Report is the report that shows every item purchased by your customers. How many were purchased, how much money was brought in. This is critical piece of data for us to use to change our business.
So let’s talk about how you can use this report.
You can use your P MCs report with your key item tracker for threat detection.
See the key item tracker uses the P mix report as your first line of defense against that by closely monitoring your high cost or high demand items. You can quickly spot well inconsistencies for example, if your lats or sales are not aligning with your inventory, it might indicate death or misuse. This focus monitoring is essential for pinpointing issues and implementing corrective measures.
For instance, in that key item report you’ve got to be getting inventory what you prepped or purchased what you could sell and then you go to the PBX find out how many you actually sold to practice and see what your ideal on hand products should be. Then we go count and we see a discrepancy. We know we have a problem.
How about setting par level?
The payment using the P mix report for setting par levels is about striking a perfect balance between well, your inventory and what you really need.
Analyze your sales data to identify trends, what’s selling what’s not. It helps in determining the optimal stock levels for each item. Ensuring you’re prepared to meet customer demand without trying well tying up too much capital.
Right. That’s the inventory on shelf to be wasted. Spoiled, stolen, if you have too much. Right. There’s so much risk involved, let alone not having the money to pay your bills. Because it’s on the shelf.
Payments report can help you with ideal food cost. Right tie that with your recipe costing cards, it’s amazing.
See pairing the P mix report with your recipe costing cards is a strategy for mastering your food costs.
Because this combination allows you to compare actual sales with the cost of ingredients for each dish, multiply it out, and now all of a sudden, I can identify what dishes are most profitable. I can see what my ideal food cost should be. If there was no waste, no stuff no spoilage. Perfect restaurant wishes not exist. I may identify those items that need to maybe reduce the portion size or buy something different to change my ideal cost.
This analysis is key to maintain a healthy margin while satisfying your customers tastes and preferences.
Now I can take that same ideal cost that P mix report with those recipe cards and now do many reengineering.
Then you re engineering it’s all guided by your payments report. I can’t tell you what your ideal food cost is without what your customers actually purchase.
But with that, putting that all together now you can put a strategy in place to align what I’m offering with my customers preferences, but also be profitable.
What changes can I make raising item prices on some items, Reducing portion sizes, doing all the things changing mix? What do I influence customers to buy?
This is all with this key mix report tied in with recipe cards, giving me ideal food costs and then making changes by analyzing each item.
Finding things that are stars that are popular and profitable. Things that are dogs which are neither popular nor profitable.
I can make data driven decisions dead pick a data driven approach that enables you to recraft or change your menu that not only delight your customers but drives your bottom line.
Often the first time through the power of this can be a three to seven point change to your bottom line.
What about using that key mix report? With Your Food costing software? What if they were integrated?
Well integrating the P mix with your food costing software offers a real time view of your ideal versus actual product usage.
This is huge. It’s the mic drop of the software.
This integration is crucial for pinpointing discrepancies of food usage, whether it’s due to waste portioning errors. That’s it’s where you say because you took inventories that used 350 pounds of chicken, but you should use 320 We know that there’s a discrepancy.
Right this puts it’s like having a finger on the pulse of your kitchens efficiency, ensuring that every ingredient contributes positively to your financial health.
Moving on to equally crucial part of your restaurant success is labor management. Your POS system plays a pivotal role here as well.
When it comes to labor management, calculating labor costs, and analyzing things like dollars per labor hour work are powerful items for you to stay on budget and become efficient.
Firstly, your POS system can help you calculate your labor costs and analyze your dollars per labor hour work.
This is about understanding the true cost of your labor in relation to your sales.
Right How much money did I use divided by the gross sales coming in gives me my current labor cost for the day, up to that hour or running Taylor total throughout the week by tracking the hours worked against your revenue you can determine also the efficiency of your labor.
Are you overstaffed? And during what sales period?
Because dollars labor our work is how many man hours worked if I had four cooks on the line and now or that’s four man hours divided by the sales that I’ve got coming in I can determine what my efficiencies are. Especially let’s say I do $125 per labor hour work if I had four cooks to be $500 in an hour, right? Well, $125 if I if it’s $25 food per person average ticket just food alone. That’s only five customers and ours are taken care of that is not efficient.
This allows you to understand not only when your slow times are your peak times are it helps you analyze when you should be utilizing your people. What’s the best place to optimize your staff to ensure you’re not just meeting your customer service expectations, but you’re also operating efficiently instead of bleeding at the clock.
You can use labor reports to spot theft at your time clock. I often talk about it’s easier to steal from you at the time clock than it is cash or even product.
See, this is another critical aspect in spotting potential fact that your time clock. This includes employees punching in too early or clocking under the wrong job code at a higher pay rate. These practices can subtly inflate your labor costs.
Regular reviewing time clock data against scheduled hours and job roles can help you identify and address these discrepancies.
It’s not just about preventing preventing potential fraud. It’s about maintaining the integrity of the payroll system and ensuring Fairness and Accuracy in how you compensate your team.
You can integrate your labor data for comprehensive analysis.
Integrating labor data with other reports from your POS system, like sales data can provide a comprehensive view of your operations efficiency.
This integration allows you to see a bigger picture, how labor directly affects your service sales or overall profitability. It’s about making informed decisions on staffing based on concrete data, not just your gut feeling.
Your POS system is much more than a cash register. It’s the gateway to the wealth of data that when leveraged correctly, can revolutionize your restaurants operation, from tracking sales and inventory to managing labor efficiency.
These reports and tools are the building blocks of the informed decision making person you need to be the leader you need to be.
They empower you to lead with competence, ensuring efficiencies profitability and success.
In our world knowledge is power and actions based on that knowledge is the parent restaurant prosperity, freedom for your restaurant, the financial freedom you deserve.
embrace these tools and write your own success story, one data point at a time.
Hey, that was an awesome episode. I want to thank you for taking the time to take action on building a better more prosperous restaurant.
Before you go. I want to give you these three products one by combining leadership and taking action with systems and training being checked by accountability. You are on your way to creating prosperity for you and your restaurant to have something I need from you. Please leave a review on Apple podcast Spotify or wherever you happen to listen to podcast by leaving us a review other restaurant pros seeking out this information are able to find it. I read the reviews and hearing how this information has benefited us does wonders. And three. If you find any of the discussions helpful share them, the more restaurant pros who have access to them the better we become as an industry.
For more restaurant resources or to get in contact. Connect with me as David Scott peters.com. Be passionate about what you’re doing. Be persistent, but more importantly become better and help everyone around you become better. And your restaurant is going to kick some ass.