The average restaurant profit margin is around 3-5% which is very slim compared to other types of businesses. The slim profit margin requires attention to detail and due diligence to find as many possible ways to increase profit.
Viewing some key expenses, such as technology and marketing, as a potential revenue or profit-center with an expected rate of return is a better way to look at these items. For every dollar you spend, you can expect a two to four times increase in profit particularly if you are meticulous about tracking, measuring, and evaluating your revenue or profit center.
Take the digital transformation that took place this past year with the pandemic. Whether with ordering, delivery, or in the case of pay-at-the-table payments, the investment you made, or will make, could be mistakenly viewed as a cost center, but it really should be viewed as a revenue-generating profit center.
For example, with pay-at-the-table, your investment will be a profit center because:
- Increased Revenues - by separating out payments from ordering with a pay-at-the-table solution, you'll be removing the server from the payment process so your wait staff can spend more time upselling and serving other guests. Pay-at-the-table reduces the time it takes for payments to process and reduces the server's time spent with the guest, resulting in increased revenue from more upsells and faster table turns.
- Labor Efficiencies - with table payment solutions and devices designed to be left at the table, your guests will be in control of when and how to pay without server interference so you can close out more guests with less staff. The Cornell University study recorded almost 20% savings equal to about 12 minutes of process time reduced for payments and 20 minutes for ordering and payments. In addition, manager time savings (reconciling tips and other payment receipts) equate to over an hour per day based on TableSafe client data. Combined with the server savings, that adds up to tens of thousands of dollars in labor savings per year.
- Cost Reductions - your pay-at-the-table solution will [GG1] eliminate the need for thermal paper receipts and save your restaurant thousands of dollars per year. In addition, when you use a best-in-class EMV platform, you'll mitigate chargebacks and fraud that is becoming increasingly common with the QR code-only mobile contactless solutions. Again, pay-at-the-table solutions offering both contactless and reduced touch EMV credit card payments will save you thousands of dollars in chargebacks (not to mention the potential for large fraud claims).
- Employee Loyalty - offering table payments is a safer experience for your staff removing the need for them to handle credit cards and running back and forth to and from the terminal to process payments. Less stress on your staff means higher employee satisfaction, loyalty, and retention so you spend less time and money on recruiting new employees.
- Guest Loyalty - because guests are in control of the payment process they can choose when and how to pay, ending the dining experience on a more positive note. More often they are willing to provide feedback and, through electronic receipts, contact information (used in loyalty marketing efforts) and have higher guest satisfaction. In another Cornell University study Customer Engagement The Key to Long-Term Loyalty and Impact version CRH 2-1-21.pdf they found that "feedback, either positive or negative, by guests signals a willingness to engage with the brand and increases the probability of them becoming loyal by almost 50%.
Altogether the view of pay-at-the-table as a revenue-generating, cost-cutting profit center is clear. By saving thousands of dollars per month, (on average for a $2 million dollar restaurant as an example) it is only a matter of months before the investment will return profits for you. To learn more about the return on investment for pay at the table solutions click here or sign up for a demo today!