May 2007

Automating paradise: Margaritaville advances its purchasing, inventory control and more with EatecNetX

At its’ multiple casual dining restaurants, Jimmy Buffett’s Margaritaville creates a relaxing and fun atmosphere that brings to life the island vibe inspired by the restaurants’ founder, singer/songwriter/author Jimmy Buffett. Since 1985, Margaritaville has been serving up Caribbean-infused pasta dishes as well as the famed "Cheeseburger in Paradise" in exciting vacation destinations ranging from Key West, New Orleans, Orlando, Las Vegas and Myrtle Beach to the Caribbean and Mexico. And to go with the great food, visitors to the restaurants can enjoy live entertainment and shop at Margaritaville’s retail stores for an array of merchandise from tee shirts to silk camp shirts that capture the essence of island escapism. 

Margaritaville Restaurant Group has steadily expanded in recent years and will open a new location in Phoenix, Arizona, in late 2007. The company’s continuous development meant that it quickly outgrew its original technology solutions, including a back-office application that was designed for smaller organizations. In order to standardize the inventory and purchasing throughout its stores and to provide a solution fit for a multi-unit organization, the company began to search for a new back-office system. In 2006, it selected EatecNetX, an enterprise software system from Eatec Corporation. The solution includes core modules such as purchasing, inventory, recipe, forecasting, production, and sales analysis functions.

The Right Fit
EatecNetX provided just what the growing, high-volume chain needed to advance its back office. Todd Connell, beverage manager for Margaritaville Restaurant Group, says, “From an operations standpoint, EatecNetX offers a cleaner, more advanced system than our previous software. We now have the ability to view our restaurants on a global level in addition to the store level.”

The first restaurant went live on EatecNetX in October, 2006, and the second restaurant went live in January, 2007. The company will implement EatecNetX in at least two more locations this year with a plan to continually add on the remaining locations.

Connell details the primary reasons for selecting Eatec and the results the company has seen since implementing EatecNetX:

• Desire for central database enterprise system – “The biggest advantage is one clean system. We now have an overview of all of our stores which means we’re spending less time searching for mistakes and more time analyzing company wide information.”  
• System-wide purchasing controls and contract price tracking – “We’re able to use the system to ensure that all of our venues are receiving the correct items at the agreed upon price. We are also able to do cost-of-sales comparisons ensuring that we get the most accurate and up to date information available when we do menu development.”
• System-wide recipe controls with store and rollup sales analysis – “EatecNetX is a live system which means if the price of beef goes up or down it’s updated automatically in the recipe for, say, our “Cheeseburger in Paradise”, so we know what that menu item’s true cost is at any given time. That’s a huge benefit.”
• Better food cost analysis and alerts to problems – “With my experience as a beverage manager, I’m used to receiving advanced notice if prices are going to change. But with food items such as produce, there is no warning. EatecNetX offers quick reports that can show the top 20 items that have changed price or your top 20 purchases, so you can easily stay on top of changes and make adjustments.”
• Improve data flow from stores to accounting and reduce re-key and re-entry of data – “One of the ways we’ve cut down on some of the manual processes is that we use a system that enables us to read bar codes for our bar inventory and use an Eatec interface to directly enter the data. We used to take that data by hand, enter it into a spread sheet and then re-enter it into the inventory system by hand. Now, we click a button, and what used to take hours only takes a few minutes.”
• More accurate and timely reporting – “There are more than 400 reports that EatecNetX offers plus some customized reports that we’ve taken advantage of. These reports have been very beneficial to all of our staff members, from the corporate level to the store level.”

Managing It Easily
The inventory management module of EatecNetX automatically records and tracks all inventory activity with respect to purchases; inter-location transfers; inter-site transfers; depletion due to production, sales, and spoilage and loss; and physical inventory variance. Connell says that the spoilage and loss module enables the company to accurately track any items that may have been spoiled after they were received. He adds, “We’re also using it as a teaching tool, because we can pinpoint if an employee is consistently wasting inventory or not making recipes properly. We can then educate them and help resolve the issue.”

With multiple locations, it is necessary for Margaritaville to request and transfer product between outlets. EatecNetX accomplishes this via the requisition and transfer module. The entire process, from entering quantities to receiving items is done automatically.

Furthermore, the production management feature in EatecNetX converts raw ingredients into finished good inventory items via production recipes. “The production management module lets us know what we have on hand at any given time. The system automatically depletes raw ingredients from inventory once they are used in the production of a new item helping to ensure that we’re ordering properly,” states Connell.

Next Up
Margaritaville Restaurant Group is looking forward to a continued partnership with Eatec. The company has set a goal to enable its stores with wireless access in order to begin using Eatec’s handheld system, EatecPocket. EatecPocket is an optional wireless pocket PC accessory of EatecNetX that allows users to perform inventory transactions where and when needed. EatecPocket can be used to perform a variety of EatecNetX functions including recording physical inventory, inputting spoilage and loss quantities, creating requisitions and entering transfer activity between outlets, and posting production on finished good items.

Additionally, Margaritaville Restaurant Group is utilizing the nutrition module that EatecNetX offers. With the implementation of Eatec, Connell notes that the company is “able to add nutritional information and allergens on the ingredient level. So if a customer has an allergy, we can search the database and then find the menu items that he or she can’t have. We keep this information in a printed book for now, but we will eventually be able to view it electronically.”

Connell also notes that Margaritaville Restaurant Group is working with its various point-of-sale partners to integrate daily product mix and sales information with the automatic inventory depletion that EatecNetX offers so that the company can gain visibility into what ingredients are being used on a real-time basis. Chefs will be able to view theoretical daily inventory reports rather than waiting until the next full inventory to see the data.

One of the best things about working with Eatec, concludes Connell, is the company’s commitment to providing ongoing support and service.

Connell said, “Eatec is proactive regarding service. They made sure that we were all well-trained on the system. And even after we went live, if they didn’t hear from us, they called us to make sure everything was going well.”

For an industry insider who knows the importance of great service, that’s something to sing about.

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