The past 18 months have posed one challenge after another for hospitality businesses. Lockdowns finally gave way to looser restrictions, but the combination of Covid-19 and Brexit meant even tighter margins as a result of reduced capacity and price hikes in food and utilities. And if that weren't bad enough, staff shortages have also begun to bite.
Operators have therefore had to rethink how they do business and drill down into what works and what doesn't, and where efficiencies can most easily be found. For many, electronic point of sale (EPoS) systems have been able to help by providing a level of insight into revenue that goes beyond the old till systems.
Jane Pendlebury is chief executive of Hospa, a not-for-profit group focused on helping hospitality professionals keep up to date with industry trends and developments. "Business performance is largely affected by how much you understand your transactions," she explains. "By processing input data, the software can help generate in-depth reports on revenue and sales, which helps operators to make more informed business decisions.
"Detailed reports from EPoS can act as the key ingredient when making decisions to help cut costs. And with monthly or even weekly comparisons of revenue and sales, you can properly analyse your performance, helping you take the requisite steps for improvement."
Stock management Integration
EPoS systems come in many different shapes, sizes and levels of complexity. The most advanced are able to integrate with stock management systems, ensuring that businesses have enough stock available to meet demand. This can be taken a step further by linking stock levels to specific recipes, allowing for a more thorough understanding of inventory.
"This removes guesswork and is an easy way to ensure that not only do you not order too much but you don't run out of anything important either, helping reduce the amount of food going to waste," says Alison Vasey, group product director at EPoS provider Zonal.
Over the past 18 months, independent chain the Jolly Good Pub Company has extended its use of PointOne's EPoS system to reduce stock and the cash tied up in it. Tom West, the owner of the chain, says: "These changes are here to stay and have helped the profitability of the business going forward, reducing wastage across the board. Our integrations with technology have helped to reduce the running costs of our business. As many of the trading periods and costs are fragmented at the moment, it's difficult to quantify and formulate a forecast in such a fluid landscape."
Cornish burger joint HubBox has also benefited from the stock module of Access, its EPoS provider. "It gives you real-time data for everything," says Jade Ramage, operations manager at HubBox Truro. "You can see sales, you can see patterns, you can see spend per head. You can track everything really easily."
In the kitchen, the software helps HubBox to efficiently manage its ordering process, cutting waste, improving margins and allowing for better forward planning – it saves an estimated two days a week. They can also build menus in advance, using the engineering tools to predict how new dishes will contribute to the overall theoretical GP.
"We can control which specific products are available to sites in our markets, and also link the same product via multiple suppliers to ensure our stock is correct regardless of which supplier was used," says the company's commercial manager Jonny Findlay.
QR codes have become a hospitality staple since lockdown was lifted, allowing guests to order and pay for food and drink at the table on their mobiles and reducing physical contact between guests and servers. These and other types of mobile order and pay apps can be integrated with EPoS systems and are increasingly expected by guests to be part of the payment process. "Not offering a contactless system leaves your establishment at risk of looking behind the times," warns Pendlebury.
The TBC Pub Company, which has three sites in Scotland, decided to develop a mobile app with Zonal in response to the changing consumer behaviour and new health and safety requirements brought by Covid-19.
"Over the past 18 months, operators have needed to switch on multiple ordering channels in multiple locations – pre-orders, delivery, click and collect, and more," says Vasey. "This means that the point of sale is no longer a fixed till on a counter. Moving forwards, operators should take this into consideration." TBC's mobile app, which is integrated with the Zonal EPoS, has allowed it to process contactless orders online through its venues. This has boosted orders in its outdoor spaces as well as opening up a new takeaway revenue stream.
Jolly Good Pub, which also recently introduced digital ordering through PointOne's app, has seen some unexpected benefits. "Brand loyalty and familiarity between our venues have meant customers can move between the pubs and use the tech easily," West explains. "The more mature end of our customer base is determined to learn this online ordering technology – they like the challenge."
Other new EPoS integrations include staff management – working hours, performance and progression. Henry Seddon, managing director of Access Hospitality, which provides this type of integration, reckons this has been the biggest change in the conversations he's had with hospitality businesses over the last year. "Increasingly, operators are looking at using their EPoS system to provide additional benefits for staff rather than just focusing on the customer journey," he says.
He adds that operators are actively looking at EPoS to make staff more productive and overcome any gaps in their workforce. "Instead of relying on a general manager to run multiple reports at the end of the week, EPoS is being used to give everyone with decision-making responsibility access to the same data in real time," he says. "This removes the worry and labour associated with importing and exporting data. It also provides improved visibility and enables responsive business decisions to be made with greater urgency."
Seddon points out that EPoS features are also being used to motivate staff. Incentives for upselling, cross-selling, hitting or improving GP targets, for example, can be implemented more effectively with EPoS data. TBC Pub has captured some of these benefits with an integrated system from Zonal. Because data is shared automatically between the different systems, staff can work more efficiently. For example, orders are processed quicker, reducing wait times and allowing staff to spend more time front of house.
With hospitality closed to the public for much of the past 18 months, businesses have had to focus on maintaining the loyalty of their existing customers. That's something EPoS has also been able to help with. Research from Zonal's Go Technology report, in partnership with CGA, showed that half of consumers are attracted by hospitality loyalty schemes.
"Being able to coordinate data gathered from multiple channels, including WiFi login and social media activity, can provide valuable information on dwell time, ordering patterns, visit preferences and so on, which is what helps build successful CRM campaigns," Seddon explains. The most effective tool for such campaigns, according to research by CGA for Access Hospitality, is a personalised email based on a recent visit or interest. Of those surveyed, 35% said this would be the most effective channel to encourage them to return to a venue.
Pendlebury predicts that social media will become a more important part of this picture. "EPoS data can be used to determine the most popular dishes or drinks, which can then be used to create vouchers to appeal to particular target markets, for instance," she explains. "This helps operators promote items that people are genuinely interested in, driving revenue as a result. Although in its early stages, this could become a staple feature of many operations across UK hospitality."
While the pandemic had a devastating impact on hospitality, it has also encouraged self-analysis, with businesses assessing their processes from top to bottom and pinpointing areas for improvement. As Pendlebury stresses, the businesses that did this most successfully were those with a clear paper trail of success and failure. This, she says, is where EPoS technology has helped the most. "With margins as tight as they've ever been, incremental measures to improve their offerings are key to recovery. We need to continue focusing on the minutiae to help improve the whole."
For hotels, EPoS technology can be applied differently for different aspects of the business. For example, EPoS can be implemented as a separate system for a restaurant, which can be particularly effectively when making F&B decisions.
Sarova Hotels is a group of independently owned hotels and health clubs in the south of England, which has had to change its practices over the past 18 months to provide a safe but profitable environment. Director Rajesh Vohra explains why change was necessary: "Post-pandemic, there is a significant trend towards room service as opposed to dine-in. Therefore, it was vital for us to have a functional and user-friendly digital platform in our hotel rooms."
Sarova decided to implement a QR code payment and ordering system from Ordamo, which has multiple EPoS integrations.
"Since using Ordamo's contactless ordering and payment systems, we have seen a significant rise in transactions across our venues," says Vohra. "It is great that, amid uncertainty, we know that we can consistently deliver our customers an excellent service, as we always have."
Tech-enabled table service
When independent pub chain the Jolly Good Pub Company reopened after lockdown, seating capacity was halved and the brand's service model was turned on its head.
"Our pubs are known for their busy bustling ambience, with crowded bars and cosy seating. Social distancing changed that, so we had to reinvent the theatre that we create in the pub. Rather than four-deep at the bar, a more European model was adopted," says the chain's owner Tom West.
A new way of operating meant the company had to think about new ways it could increase its profit margin. Technology played a key role here. "We integrated an online ordering app, allowing customers to order at tables, reducing labour. This meant we had to retrain the teams to handle other tech-related questions," West explains. "This service was initially difficult to get the customers to buy into, but once we got the pitch right, our customers appreciated how much quicker it made our service."
Paul Berryman, sales and partnership manager at PointOne EPoS, says: "Like many of our clients during the past year, Tom wanted to implement our mobile order and pay app so that his chain of pubs could quickly adhere to the social distancing rules, keep his staff and customers safe, and make it really easy for customers to order and pay for their drinks and meals. We were able to roll out our app quickly and get Tom and his team up and running and taking vital revenue between the lockdown periods."