The Restaurant Biz Blog

I just read a very thought provoking article entitled "The Internet devalues everything it touches"

After I first read it, I started to wonder what I was devaluing by using the Internet to help restaurants save money. Am I putting people out of work or reducing the value of alternatives?

If I take a step back, I think the Internet is the same as any technology. Did robots devalue the earning potential of an assembly line worker? What about the steno pool? Rooms full of typists were instantly devalued by the introduction of the photo copier.

It's a cycle, a new technology comes along and introduces new efficiencies, disrupts the market, then as the market gets saturated with the new tech, you have commoditization. Then repeat.

The Internet was a new technology, but it is also an enabling technology, like a microprocessor, or the ability to make steel. These foundation technologies (for lack of a better term), are disruptive, but also have amazing longevity as they are building blocks for the next great new innovations.

So while it may feel like everything around us is getting devalued by the Internet, we have to step back and see it for what it really is... a cycle. There will be another one coming. Green tech anyone?

This is a follow up to my last post about the top 5 things that restaurants should be doing online. There are several good reasons for using online applications or software as a service (SaaS) as it's sometimes called.

• Save Money - First, you'll have lower IT costs since you no longer need to employ people to worry about servers and software. Second, there are economies of scale at work. The vendor can allow several clients to share servers and resources resulting in a lower cost to the end users. Finally, most services are pay-as-you-go. There's no big investment in new hardware and software as with the typical on-premise systems. Just pay your monthly application fee and you're off to the races.
  
  
• Save Time - Let's face it, any new software system is going to take some time to get setup and in place, but with most web applications, you can start using it the first day.
  
  
• The Latest and Greatest Innovations - Most online services are being upgraded every few months if not every few weeks. With online software, you get all the new features as soon as they are ready. This is one of the things I really enjoy at WhenToManage, we get some great opportunities to delight our clients. Someone may make a suggestion to us on Friday and by Monday they could see it in production.
  
  
• Global Availability - You can access your data from anywhere at anytime. And furthermore, your data is typically much safer in your vendor's world-class data center, than it is in your overcrowded office/closet in the back of the store. Most vendors provide highly available systems with several backups of your data.
  
  
• Community - The companies providing these services are typically very close with their customers. With a product that gets updates so frequently, there is usually an online dialogue or conversation between the company and its clients that results in a type of collaboration. This public back and forth really opens things up and allows the client be involved in the direction of the company.

I'm sure there are a few more reasons that I have left off my list, but in the end, it's simply a choice between embracing the future and hanging on to the past. Those who board the train early will have the competitive advantage. Don't wait too long.

These days there are several vendors offering web-based solutions for restaurants. The more units a  restaurant has, the more benefit to using an online solution. In my next post, I will dive into the details regarding all the benefits to using software as a service (SaaS), but first let's take a look at what is out there.

1. Labor Scheduling - this is the first place for any restaurant to start. Let's face it, you're online and your employees are online. With online scheduling, everyone can get their schedules via the web, email, or cell phone. They can make requests, trade shifts, and just basically communicate with  the staff. At WhenToManage, this was our first product that we launched. HotSchedules is another company that offers a solution.
   
   
2. Inventory Management - one great thing about web-based inventory is that more and more suppliers are offering online ordering, so it only makes sense to allow these systems to talk to each other. For a restaurant company with more than one unit, an online solution allows them to manage their recipes from a central location as well as manage the entire supply chain from any laptop in the world. WhenToManage offers online inventory, if anyone knows of another web-based solution out there, please let me know.
   
   
3. Reporting - getting the numbers from a single location is one thing, but when you start multiplying it by 5, 10, or 50, you really need a system to pull everything together from your POS systems, inventory systems, payroll systems, etc. Just imagine automatically getting an email on your Blackberry every morning at 7am with all your sales data from all your stores for the previous day. WhenToManage offers this as does a company called Guest Metrics.
   
   
4. Marketing - this should actually be #1, but I thought it was too obvious. Unfortunately, it's probably not obvious enough for a lot of companies out there. There is not an easier or cheaper way to reach your customers than email. At the very least, you should have a customer database and send them an occasional email about your latest and greatest promotion. From there, you can upgrade to a loyalty program and stored value cards. There are lots of great companies that offer these services. Fishbowl and Stored Value Solutions are two that come to mind, but there are many others.
   
   
5. POS (Point-of Sale) - POS systems are the core of any restaurant operation, and a web-based POS solution may strike fear into your heart, but rest assured, there are some amazing products out there and they all have systems to secure your data and keep everything working when the Internet goes down. How great would it be to update a price a) from home b) for 20 stores at the touch of a button? How great would it be to open the store in the morning with the latest POS upgrade that installed itself before you got in (and did I mention that your other 20 stores were also automatically upgraded at the same time)? NetPOS offers a fantastic solution that I know quite well, and Halo also offers a web-based POS.

Hopefully, this will get you thinking about making the next step in the evolution of your restaurant.