key performance indicators

1. Learn how to measure and
track the success of your
foodbusiness with these
12 Key Performance
Indicators

2. tight margins, high employee
turnover rates and a fiercely
competitive market make for
an uphill battle for newcomers
and veterans alike.

3. RESTAURANT OPERATIONAL KPIs
The following KPIs look at your sales,
turnover, profit and overall efficiency –
giving you clear picture of how
productive your staff is, how much
money they’re bringing in and how
your restaurant is doing overall.

4. Cost of goods sold (CoGS): CoGS
measures how much it costs to make
each item on your menu. This will help
you determine how to price your menu
items and how much profit you’re making
on each dish. Make sure to do a regular
review of your menu pricing, and look at
which menu items sell the best, so that
you can make pricing and promotion
decisions based off of both your CoGS
and sales volumes.

5. Net Profit Margin: Your Net Profit
Margin is the profit your business
makes after deducting all of your
expenses like CoGS, rent,
electricity etc. Just remember, it
takes most restaurants a few years
before they start to turn an actual
profit, so don’t worry if these
numbers look bleak in the
beginning!

6. Break-Even Point: This is another
one of your most essential KPIs, as
it helps determine how much you
should be selling in order to break
even. This number will also help
you forecast just how long it will
take for you to earn back your
investment.

7. Average Occupancy: This metric
tells you how many customers
visited your restaurant over a
certain period of time. It will help
you determine which times of day
are most/least popular, and help
you find out when you might want
to pull the trigger on a new
promotion or special offer.

8. Table Turnover Rate: This
defines the number of tables
turned over a given period of
time. You'll want to try to increase
your table turnover rate (by
decreasing your service times) –
as logically speaking, the more
people you can serve, the more
money you’ll make.

9. Sales Per Head: Sales Per Head is
how much money, on average, each
patron spends during their sitting. It will
help you better understand which time
of day is most profitable and what items
on your menu (whether it be food or
beverages) are most popular.
Combined with your table turnover rate,
this can also help you forecast sales.

10. Employee Turnover Rate:
Unfortunately, employee turnover rates
in the foodservice industry are
unusually high – and it can cost
restaurant managers a lot of money.
Keeping a close eye on your employee
turnover, and implementing measures
to address underlying issues, will help
you save on unnecessary hiring &
training costs to replace disgruntled
employees.

11. KITCHEN AND
INVENTORY
KPIs

12. Production Time Per Dish:
When it comes to the food
preparation, time is your most
precious asset. Make sure you
know how long it takes to prepare
each dish (especially your most
and least popular dishes) so that
you can consider ways to shorten
production time and offer faster
service.

13. Food Waste (per food
purchased): Food waste is no longer
just a financial burden, but is
increasingly becoming a sustainability
issue, too. Keep track of how much
food waste each menu item is
producing so that you can optimize your
procurement, storage and preparation
methods to cut down on waste and
increase your profit margins.

14. Inventory Turnover Ratio: Your
Inventory Turnover Ratio refers to
the number of times your
restaurant has sold out its
inventory over a given time. This is
another important metric for
helping you manage your
inventory – and making sure you
don’t over or under-stock on
produce.

15. CUSTOMER
SATISFACTION
KPIs

16. As we all know, the customer is
king. And keeping your
customers satisfied and coming
back for more is what’s going to
keep your business afloat in the
long run. Here are 2 key things
you’ll want to consider when it
comes to tracking your
customer satisfaction:

17. Customer Retention Rate: This
metric will help you understand how
loyal your customers are, and whether
your patrons are coming back to – or
not. Finding new customers is always
more expensive than keeping your
existing ones, so make sure to
implement a loyalty program or
incentives to keep them coming back.

18. Online Reviews: What customers
say about your business can make
or break your reputation. Keep an
eye out for different platforms – like
Google, Facebook, Tripadvisor and
Yelp – to see what your customers
are saying about their experiences,
and find out how to better improve
your menu and service.

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