Any food service operator, including small- to medium-sized restaurants, need to measure some key performance indicators (KPIs). The dining industry is vast with many layers, and that makes it a fiercely competitive space. Developing a short list of KPIs is essential to beat back the competition, and, if it’s in your plans, grow your business.
Running an ice cream or frozen yoghurt parlor is very different from running a restaurant. Most shops don’t have seating, so popular restaurant KPIs like Table Turnover Rate or RevPASH aren’t relevant to your needs. Based on the unique needs of ice cream stores, we have developed a concise list of essential KPIs that explain the state of your business and help you steer it in a profitable direction; all of which can be monitored with an ice cream shop POS system.
Track the Best-Selling Flavors
As the owner of manager, keeping up with ice cream trends should be on your radar. While not every trend should be incorporated into your menu, some trends are persistent and have a way of reshaping an industry (take, for example, the gluten-free dining trend).
Gourmet and artisanal ice cream prevailed in 2016, globally-inspired ice cream flavors influenced 2017 shop owners, wacky ice cream flavors were trending in 2018, and in 2019, creative ice cream vessels appear to be the new hot trend (like Booyah’s ice cream taco). Also, designing the presentation of ice cream to be Instagram-worthy is still a “thing” in 2019 and appears to be one of those persistent trends that shouldn’t be ignored.
When you add a new menu item (in fact, to keep customers interested, you are encouraged to frequently update the list of ice cream flavors), you want to track how it sells. Additionally, you want to know what the top-selling flavors are and how consistent their sales are.
Knowing which flavors perform the best and which don’t is crucial for both profitability and cutting costs. For instance, you might have not seen that one flavor is a dud and costs more money to purchase ingredients for and store than it’s earning. Removing it from the menu removes a set-back from your business. In its place, make a top-selling special flavor a permanent menu item.
3 Examples of How Knowing Your Best-Sellers Can Help Boost Sales:
- Create special promotions for the best sellers, like purchase two pints of ice cream for a discount. Customers will jump on the chance to take their favorite ice cream home for a good price, and it’s a great way of promoting your take-away option.
- Find a pattern among the favorites and develop flavors that will attract more customers. If your sales reports show that exotic fruit flavors and chocolate are consistent top sellers, make a special combo flavor of both.
- Improve on inventory management to always have these flavors in stock and avoid disappointing customers.
Average Ticket Size
This KPI shows you the average of how much money each customer spends at your ice cream shop. (It’s also known as Sales per Guest.) It’s important because you can find out which flavors are underperforming, and if you’re selling enough ice cream to cover costs and be profitable.
To calculate the average ticket, take the total value of all transactions and divide it by the total number of transactions.
3 Ways to Analyze Business and Make Improvements with the Average Ticket Size
- Track the average ticket every day for one month. Then, you have a decent amount of time to see patterns in consumer behavior. A common spending trend for ice cream parlors is higher ticket averages on the weekend because of groups of friends or families enjoying the day together.
- If you find that the average ticket price is lower than what’s needed to be profitable, then you can make strategic changes. For instance, you might be selling the ice cream too cheap and can’t cover all related costs. Raise the prices to what’s necessary and explain the increase to customers in a thoughtful message on the board so they understand why.
- Identify the slowest day of the week