The Five Areas Where Multi-Unit Operators Are Overspending

Over the years we have worked with many operators on decreasing the upfront costs of opening new stores, lowering their support costs, and getting their technology to do what they want it to.  We’ve unfortunately seen a lot of mistakes along the way, that could have been prevented with proper planning with a strategic partner. When we meet with a potential client, one of the first things we do is a Technology Infrastructure Assessment to determine what is working and what needs to be tweaked or changed.  In doing this assessment, we’ve found there are usually five main areas that operators are overspending: labor, support, products and software, change orders, and telecom. With proper planning, these areas can be streamlined, standardized, and become very useful in growing your business, but when not implemented properly, can lead to overspending, inefficiencies, and even lost business.

Labor
Paying for skilled labor in the opening process of a store or restaurant is one of the most costly pieces of the infrastructure process.  This is partly due to the fact that training takes time, effort, and collaboration. Training employees properly is one of the most important factors in a smooth opening, where understanding and using the technology to deliver a smooth customer experience can determine whether or not they return to your restaurant.  Training on software and technology is complex and can be difficult for internal trainers to cover all topics in detail before a store opens. This is where you should ask yourself if your current vendor acts as a strategic partner. A technology vendor who provides training support before a store opening is key. Sending internal trainers to each store opening to train employees on equipment and software is costly and in most cases inefficient.  Your IT partner should offer training services and should deploy an onsite technical support person for your store openings to train your employees, answer questions, and handle any issues pre-opening. They should also be available to “train the trainers” and get them up to speed before store openings.

Support
Many times when we evaluate the current support provider during our assessment, there are redundancies or inefficiencies.  Do you have internal technicians employed for support services and break-fix problems? Paying salaries plus benefits for a whole IT department can be much more costly than outsourcing your IT department.  The ideal program would come from a consolidated vendor with an experienced support team who can support your business on an as-needed basis, with the costs built into the contract. If an internal IT support program is part of your corporate structure, many times outsourcing IT can not only decrease the need for multiple internal technicians, but it can also free up time for the internal IT department to focus on more strategic technology planning and initiatives.

Products and Software
The cost of your products are directly related to the engineering, design, and type of products you’re using in your store.  When we evaluate potential customers’ infrastructure, we find the cost of products to be much higher than they need to be. The systems and products are over-engineered, do not help the customer meet the objectives of the business, or they are causing inefficiencies.  Sometimes it is just a matter of working with a vendor who knows and understands the restaurant industry and what technology you need to operate your locations with ease. Do you need Mobile Device Management implemented so you can have visibility to all of the Ipads at your hostess stations across the country?  Do you have different products at all of your different locations? Just standardizing products across your brand can help tremendously with the cost of training, support, and installation. If your current vendors aren’t asking you what your business goals are before they are customizing your product setup, then chances are you’re overpaying for something that isn’t doing what you need it to do.

Change Orders
The hospitality and retail industries are ever-changing.  And so are the needs of the next generation customer. With that in mind, we set out to determine how operators could avoid the cost of change orders and re-configuring devices with every store opening.  Anticipating and planning for growth is one of the most important strategies to help with the costs of growing pains.  Having a clear developmental roadmap with clear plans for things like bandwidth, networking, and even cabling is a great strategy to save money.  Do you have enough bandwidth to support your growing brand, or will it become a problem later when your customer base grows? Do you have failover internet solutions in all of your high-volume locations so credit card, gift and loyalty processing can continue in the event of an internet outage, or will you have to go back later to install after problems arise? Costly change orders can be prevented in the early planning stages.  Standardizing your infrastructure across the brand, keeping equipment the same, and getting franchisees on the same page with your corporate technology initiatives are key to keeping costs down throughout your business’ growth.

Telecom
Finding ways to save money on telecom services goes beyond just what provider you’re using.  You may be paying for phone services with features that you don’t need or don’t know how to use.  Sometimes we find that the current phone system is not even working properly, causing latency issues, missed phone calls, and ultimately lost business.  Working with a technology vendor that offers training and support for your telecom needs is a must. They should be able to offer product knowledge on features that will help drive your business forward.  As the size of your organization changes, so do your telecom and data needs. Your technology vendor should also be holding annual (at the very least) reviews of your telecom usage to discover inefficiencies and problems.

When you’re running and growing a multi-unit business with tight margins, changing customer demands, and growing competition, it’s important to work with a vendor who understands your industry, has product knowledge and expertise, and is available to support your business from concept to implementation, all with the goal of driving efficiencies and lowering your costs.  This should start in the pre-planning process, but continue through the growth of your brand, with normal check-ins to evaluate the health and stability of your technology infrastructure. If you think you might need our services, contact us for a Technology Infrastructure Assessment, where we can establish a baseline for what’s working and what’s not for your business!