April 2001

Profits Rock - Taking a page from the lodging industry, smart restaurants gain profit with yield management
by Curt Harler, Contributing Editor

Long before there was a computer in any restaurant or hotel, operators understood that the more times they interacted with each guest, the more potential revenue they might raise. What they couldn't control in the dark past was how much they spent on each interaction and how the balance weighed when they went over their books at the end of each business day.

That's changing all over the hospitality industry, but for restaurants, the new application of yield management software long a mainstay of hotels has proven to squeeze more dollars out of every transaction.

Pilot Project Completed

Restaurants stand to pocket a substantial amount of additional cash by measuring the yield from each recipe used each day, according to the operators HT spoke to at a half-dozen establishments across the nation. At Applebee's in Kansas City, for instance, we learned that the application of Eatec software will be used to cut the cost of French fries $500,000 this year alone.

One Applebee's insider told HT that in calendar year 2000, his chain cut food costs by "46 basis points" through yield management. The company commissioned the Eatec (www.eatec.com) system to help cut waste in the kitchen. Although the base cut was less than a half percent, a spokesman noted that it was multiplied over 250 locations.

Real Time Data

Applebee's runs the EatecNet database on Microsoft SQL Server 7.0 at its Kansas City headquarters, linking it to remote locations through six Citrix Application Servers. All figures are real-time, except for sales that poll up to the Kansas City headquarters each night.

Before installing the system, Applebee's had no good way to track waste management. Everything was based on historical data and food budgets from the past year.

With the Eatec system Applebee's calculates daily recipe requirements and food sales. At the end of the week, managers put in inventory figures and get a store-by-store comparison.

Applebee's started to look for a better inventory control and yield management system about two years ago. The initial rollout to company stores was completed May 1, 2000. Since then, another 15 stores were added. More will come online before summer. They will use the EatecNet System with a browser-based interface.

This was excerpted from the April 2001 issue of Hospitality Technology and may differ in content or context from the originally published article. To see the full text visit www.htmagazine.com.

Back to Archived Media Coverage

To receive more information on our products please email us at sales@eatec.com
or call 510-594-9011 ext #2 to speak with a representative in your area.