Canadian Pizza Magazine

News Business and Operations
Report gives insight into restaurant chains’ operations hurdles


January 7, 2020
By Canadian Pizza

Topics

San Francisco, CA – Improving employee productivity and compliance with operating procedures are top priorities for U.S. restaurant chain operators, according to a survey conducted by operations platform Zenput in collaboration with Technomic.

The survey looked at the top barriers to consistent team execution and customer experiences facing both corporate brands and franchisee organizations, as well as where operators are prioritizing initiatives to improve operational execution in 2020.

According to the research, the barriers to consistent store execution most frequently mentioned are rising labour costs, employee turnover and insufficient training. Less than one in five restaurant operators say their stores are very effectively complying with operating procedures and key initiatives.

Only one out of three operators report being very confident that they’re able to identify potential food safety concerns before they become an issue.

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The top cited priorities for the next 12 months are store employee productivity, improving compliance with procedures, field team productivity and improving store-level task completion.

“The research findings underscore that restaurant operators are finding consistent execution increasingly difficult to achieve due to rising labour costs, high turnover and the challenges associated with maintaining quality control across a geographically dispersed operation,” said Vladik Rikhter, Zenput’s chief executive officer. “To remain competitive and grow, it’s imperative that brands and their franchisees focus on improving operations execution at every location, which if done well can be a key point of differentiation.”

STORE COMPLIANCE

Less than 20 per cent of restaurant operators felt their stores were very effectively complying with operating procedures and key initiatives rolled out by the operations team at headquarters. Among full-service operations, this figure drops to 11 per cent.

The compliance issue may stem from how operators report getting visibility into store execution today, the company said in a news release. Almost half of operators are using traditional tactics such as communicating via phone calls and text messages, while only 20 per cent of operators said they use software to improve visibility.

FOOD SAFETY

The ability to quickly identify issues and proactively address them before they become bigger problems is essential to long-term profitability. Most restaurant operators agree that a customer food safety issue could put their business at risk and would lead to a negative sales impact, yet just over one-third of respondents report they are very confident that their operation is able to identify potential food safety concerns before they become issues.

AUDITS

While audits are essential to ensure corporate brands and franchisees are delivering consistent experiences, only 22 per cent of operators feel they are being completed very effectively. Moreover, a lot of a field employee’s time is being consumed by the audit process. On average, field employees are spending over 30 combined hours of their week on in-store audits, preparing reports and following up with stores to ensure corrective actions were taken.

AUTOMATION

Just under one-third of operators say they are embracing technology to automate various aspects of their organization “to a great extent.” That said, of those that are embracing automation, many say their experience has been positive.

 

The research study was based on a survey of 295 restaurant operators conducted by Technomic in the fall of 2019. Survey participants included operations leaders and managers, field leaders, store managers, IT leaders, c-suite execs and owners.