1
Everything you need to know about next-generation food and beverage service technologies – and how to select the right ones for your business.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems
TM
Independently produced and distributed by:
Underwritten, in part, by:
2
Introduction pg. 3
Chapter 1: Topic Overview and Key Concepts pg. 5
Chapter 2: Buying Considerations and Evaluation Checklist pg. 14
Chapter 3: Must-Ask Questions pg. 22
Chapter 4: Roadmap and Recommendations pg. 27
Chapter 5: Inside Voices and Outside Voices pg. 31
Appendix pg. 34
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Table of Contents
3
Introduction
New restaurant management and POS systems are having a profound impact on business operations, guest satisfaction , revenue growth and profitability.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Restaurant operators often speak of innovation in terms of putting new
signature dishes and food creations on the menu. But where the biggest
innovation is happening today, arguably, is less on the menu and more in the
technology that is driving increased efficiency and effectiveness across all
parts of the food and beverage services industry. Next-generation restaurant
management and POS systems are having a profound impact on business
operations, guest satisfaction, revenue growth and overall profitability.
These advanced technologies are bringing more change to the industry than
anything since the 1980s, when restaurant operators shifted from cash
registers to POS terminals. The technologies encompass both software and
hardware — most notably, the introduction of tablets. Whether standard-
issue, all-purpose models or devices specialized to the task at hand, tablets
make it possible to put full POS terminal functionality in the palms of servers’
hands. According to research conducted for this Smart Decision Guide, more
than three-quarters (78%) of restaurant operators cite the benefits of POS
mobility as the top reason to upgrade their technology capabilities.
Yet the benefits of POS mobility is certainly not the only reason that so many
restaurant operators are upgrading their capabilities. The growing need to
accept new payment methods , including chip credit cards and e-wallet apps,
also ranks as high priority in many peoples’ minds. The need to comply with
new data security requirements is another compelling reason that so many
restaurant operators are making the leap to a next-generation system.
4
Introduction
Today, restaurant operators have a vast array of compelling reasons to upgrade their technology capabilities from an antiquated and underperform-ing system.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
So, too, are the benefits of migrating from on-premise installation to cloud-
based deployment. In addition, many restaurant operators are drawn to the
improved user interfaces — and increased flexibility and customizability —
that have become the hallmark of next-generation solutions.
For some restaurant operators, the biggest selling points are improvements
in features and functionality. These improvements are evident in the
expanded ordering and payment processing capabilities. They are evident in
the built-in inventory control and labor management capabilities. In some
cases, they are evident in the marketing , guest relationship management and
loyalty program management capabilities. Just as important to many
restaurant operators are the robust data analysis and performance reporting
capabilities that many solutions now offer and which can help them better
manage their operations and identify more opportunities for improvement.
In summary, restaurant operators have plenty of reasons to want to migrate
from a legacy system that may be lacking in multiple areas to a state-of-the-
art system designed to meet their needs now and into the future. For those
grappling with payment processing and security deficiencies, the need may
be urgent. This Smart Decision Guide offers a roadmap to success for both
new and existing businesses. It includes insights for evaluating different
solutions and practical guidance for making the right selection based on their
individual priorities and requirements. It also includes pointers for
maximizing the value of the investment once the system is implemented.
5
Topic Overview and Key Concepts
Chapter 1
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
6
The food and services industry as a whole is undergoing a seismic shift in terms of enabling greater staff productivity, operational efficiency and overall guest satisfaction.
Chapter 1: Topic Overview
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Before the rise of cloud technology and POS mobility, and before the advent
of new payment processing methods , technology change came slowly for
restaurant management and POS systems. That is not to say that there weren’t
significant advances in capabilities in the years and decades since stationary
POS terminals fundamentally transformed the way food orders were taken
and sent to the kitchen. There were, in fact, many notable advances. A good
example is the introduction of integrated inventory management capabilities.
Yet such advances tended to have relatively little impact on the issues that
keep so many restaurant operators up at night. Such issues tend to include
the need to drive revenue growth and the need to mitigate staff and process
inefficiencies and, often, reduce slow table turnover rates, which can result in
loss revenue. No wonder, then, that, until recently, many restaurant operators
may have felt hard-pressed to justify the investment in a new system.
That all changed with the rise and proliferation of next-generation systems.
The evolution of these systems has progressed rapidly over the past few years,
bringing dramatic change to restaurant operations. Indeed, the food and
services industry as a whole is undergoing a seismic shift in terms of enabling
greater staff productivity, operational efficiency and overall guest satisfaction.
In fact, according to research conducted for this Smart Decision Guide, 73% of
full-service restaurants, and 57% of quick service and fast casual restaurants,
achieved “significant” or “dramatic” improvement in their operations and
revenue performance after having deployed a next-generation system.
7
Every solution provider is moving fast and furiously to not only maintain competitive parity but also meet restaurant operators’ expectations of new technology.
Chapter 1: Topic Overview
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
The competitive environment has grown increasingly intense for solution
providers operating in this arena. By now, most of the well-established
providers of stationary POS terminals have expanded the scope of their
offerings to include cloud-based deployment, POS mobility and a plethora of
other next-generation capabilities. Some of these solution providers are
among those now leading the charge on technology innovation. Meanwhile, a
number of newer players have come onto the scene, most of them with tablet-
only POS systems tailored to different food and beverage service segments.
There has also been a significant amount of consolidation amongst technology
solution providers. Several large mergers have taken place in the past year
alone. Whether an incumbent or a newer player, virtually every solution
provider is moving fast and furiously to not only maintain competitive parity
but also meet restaurant operators’ growing expectations of the technology
capabilities. Today those expectations go well beyond merely being able to
accept mobile wallet and ensure EMV-readiness and payment security.
To that point, restaurant operators generally have two main objectives in mind
when it comes to any technology investment. The first objective is to
streamline operations. Here the goal is to increase employee productivity and
process efficiency, resulting in significant cost savings. The second is to
enhance the quality of the guest experience, leading to increased satisfaction,
loyalty, advocacy (including favorable reviews on Yelp and other popular
ratings sites) and, of course, revenue growth. The good news is that next-
generation systems can play a key role in achieving both these objectives.
8
Chapter 1: Topic Overview
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
73%
86%
90%
93%
0 20 40 60 80 100
Improve data analysis and performance reporting capabilities
Improve staff productivity and streamline business operations
Meet new payment processing and compliancy requirements
Improve customer satisfaction, loyalty and positive word of mouth
Research Data Point What are the biggest benefits one can expect to gain with the right Restaurant Management and POS System?
Most restaurant operators today can make the business case for upgrading their technology capabilities
without much difficulty. The return on investment is clear. It can be measured in terms of cost reduction,
which is largely a function of increased staff productivity and resource utilization. It can also be measured in
terms of revenue growth. This is largely a function of improved guest satisfaction and, in some cases, faster
table turn times — and also, in certain venues, the ability to reach and serve a larger number of guests
simultaneously. The ability to improve financial performance with advanced inventory and labor
management tools and better performance reporting can help further justify the investment.
Reduce costs Increase revenue Increase profitability
Reduce payment processing time Reduce food order placement time Improve staff productivity
Improve customer satisfaction and loyalty Improve staff management and inventory controls Gain business intelligence Meet payment compliancy
Research findings are derived from the Q1 2016 survey on Restaurant Management and POS Systems.
9
Faster order placement and pay-at-table processing , as well as more payment options, can remove some of the most common barriers to guest satisfaction.
Chapter 1: Key Concepts
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
There are a number of key concepts that restaurant operators should keep in
mind when researching next-generation restaurant management and POS
solutions. These key concepts include “must-have capabilities” necessitated by
new payment methods and security requirements as well as “nice-to-have
capabilities “ unrelated to “point of sale” such as inventory management and
employee management. Following are a few brief descriptions.
POS Mobility. According to research conducted for this Smart Decision guide,
almost two-thirds (63%) of restaurants currently host their POS systems in the
cloud, with an additional 31% planning to do so. The benefits include faster
speed and greater scalability as well as lower maintenance costs. The benefits
also include the ability to use mobile POS devices for order and payment
processing , which can be key to increasing revenue while also reducing
overhead costs in some restaurant categories. Consider the advantages that
table service restaurants enjoy when servers can place orders directly from a
tablet to the kitchen printer or display rather than from a stationary terminal
that may be a good distance away — and perhaps with obstacles blocking
direct access. Rather than having to wait in line to punch orders into a terminal,
servers can spend that time interacting with guests and attending to other
duties that enhance their dining experience. Faster order placement and pay-
at-table processing , as well as more payment options, can remove some of the
most common barriers to guest satisfaction. Importantly, these capabilities can
also enable a restaurant to turn tables considerably faster than before and also,
in some environments, reach and serve more guests at the same time.
10
While mobile payment processing and EMV are taking off at the same time, it seems clear that mobile will become the preferred payment method over time.
Chapter 1: Key Concepts
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Mobile Payment Processing. By now, most restaurant operators have
upgraded their restaurant management and POS systems to be able to accept
EMV payment processing capabilities and meet the compliancy requirements
that went into effect at the end of last year. Many operators are also now
purchasing hardware that can accommodate NFC payments for mobile.
Increasingly, guests want to be able to use their own smartphones with the
restaurant’s POS system. They want to be able to pay their bills with Apple Pay,
Google Wallet or Android Pay rather than with a debit or credit card. The fact
of the matter is that EMV payment processing tends to result in a suboptimal
guest experience. That’s because it not only requires greater effort but also it
has a significantly longer wait time than mobile payment processing (given the
need for the technology to rewrite the security transaction of the card). In fact,
EMV transactions where the guest inserts a credit or debit card into the POS
device typically take upwards of 15 seconds to complete. In some restaurant
categories (e.g., drive-thru windows in fast-food chains, where the key
performance metrics are tied to number of cars per hour and customer service
times), that length of time can be hard for operators to stomach. In contrast,
mobile payments typically require only a few seconds to complete. While
mobile payment processing and EMV are taking off at the same time (and
operators can generally now accept mobile payments at the same terminal as
EMV processing), mobile will likely become the preferred payment method
over time. Until recently, it was difficult to make a strong business case for
mobile payments, but now the benefits are clear. As a result, more restaurant
management and POS solution providers are investing heavily in contactless
payments and support for the popular NFC mobile technologies, which
provide the security as EMV processing, but, again, at a much faster speed.
11
Many next-generation POS systems have built-in capabilities that make it possible to readily generate all types of actionable insights, oftentimes on an ad hoc basis.
Chapter 1: Key Concepts
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Data Intelligence. Which dishes are the most popular? Which dishes are the
least popular? Which are the most profitable? Which are the least profitable?
Which servers are the most productive? Which are the least productive? Which
types of customers are the most valuable? Which are the least valuable? The
answers to these and countless other questions generally reside somewhere in
the POS data. In the past, mining data to extract meaningful insights tended to
be an onerous and time-consuming proposition. Many next-generation POS
systems, by contrast, have built-in capabilities that make it possible to readily
generate all types of actionable insights, oftentimes on an ad hoc basis. This
gives restaurant operators the ability to make more informed decisions about
all aspects of the business. Some systems can even open a window into the
future and predict financial outcomes based on such factors as dining-out
trends and seasonal dish popularity. In some cases, alerts can be set based on
predefined triggers. These alerts can notify a manager when inventory is
running low and needs to be restocked, for example, or when high-cost or
high-risk food items like liquor are going out the door unaccounted for,
indicating the possibility of theft. POS intelligence, which goes by many names
and generally encompasses multiple aspects of a restaurant’s operations, can
be key to maintaining a competitive edge and driving performance
improvement on an ongoing basis.
Guest Management. Having the capacity to capture an enormous amount of
valuable customer information from POS transactions as well as from other
data sources, including guest feedback solicited through survey and reward
12
Using guest management capabilities that enable carefully tailored communica-tions and promotions, operators can launch targeted promotional campaigns and rewards programs.
Chapter 1: Key Concepts
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
programs, enables restaurant operators to take a more guest-centric approach
to managing their businesses. By creating meaningful segmentation schemes,
and by gaining an understanding of the various characteristics and
commonalities that exist amongst guests in terms of their geo-demographic
and psychographic makeup, restaurant operators can improve the value of
their guest relationships. Using guest management capabilities that enable
carefully tailored communications and promotions, they can launch targeted
promotional campaigns. They can build customized loyalty and rewards
programs. They can refine their menus and adjust other drivers of guest
satisfaction. And they can engage in a host of other activities that increase
loyalty, generate positive word of mouth, and increase revenue.
Employee Management. Many POS systems now come with a host of
integrated employee scheduling tools. Some systems even boast of financial
management features designed to optimize labor utilization. These tools make
it easy to not only perform basic tasks like tracking employee hours and
submitting payroll directly from the system, but, in some cases, to also predict
sales and staffing needs. Using data-driven sales forecasting and labor
planning tools, managers can plan for the volume of business that is expected
on a daily and hourly basis based on historic information and other factors. By
accurately meeting labor targets, and also by understanding which servers are
the most productive, restaurants can better control payroll costs and maximize
workforce efficiency. The benefits of integrated employee management tools
are easy to measure and can have a dramatic impact on the bottom line.
13
Inventory Control. Managing inventory in the food and beverage services
industry generally requires a great deal of diligence. Restaurant operators
need to do everything possible to minimize food waste, spoilage, theft, and
over-production. They need to understand how adjustments to menus and
recipes flow down to ingredients. They need to track the variances between
physical inventory and POS data to determine if there may be theft or portion
measurement issues. The good news is that inventory management
capabilities are becoming increasingly sophisticated and also a standard
integrated component of next-generation restaurant management and POS
systems. Restaurant operators can track inventory depletion in a real-time
manner to help reduce food waste, monitor inventory levels and increase
profitability. They can track raw materials from the time the kitchen receives a
shipment through ongoing ingredient usage based on menu item orders.
Some solutions offer automatic purchase order generation based on par
levels and minimum order quantities. Some solutions even offer multi-unit
restaurant features that include resource sharing around food inventory
management.
Seat Reservations Management. Some solutions now offer interactive
reservations tools that allow guests to not only reserve a date and time, but
also their preferred table, server or section of the restaurant. Integrated seats
reservation management capabilities can enhance the guest experience. They
can enable operators to know in advance when loyalty members (who can
enter their member account information when booking the reservation) will
be visiting so that personalized service can be provided. This direct approach
to reservations also avoids having to pay a fee to a third-party booking agent.
Inventory control capabilities make it easier for restaurant operators to track ingredients while minimizing food waste, spoilage, theft, and over-production.
Chapter 1: Key Concepts
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
14
Chapter 2
Buying Considerations and Evaluation Checklist
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
15
Chapter 2 Chapter 2: Buying Considerations
In selecting a new system, the buying considerations are sure to depend to a large extent on a restaurant’s specific category and size as well as its differing strategic priorities.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Increasing revenue and margins by even a few percentage points can make a
big difference in the world of food and beverage services, sometimes to the
point of determining whether an eating establishment stays in business or is
forced to shutter its doors. Such are the economic constraints that are the
reality for many restaurant operations. It’s no wonder, then, that so many
restaurant operators are looking to technology to improve efficiency and
effectiveness. According to research conducted for this Smart Decision Guide,
almost one-quarter (24%) of restaurant operators who have not purchased a
new restaurant management and POS System within the past 3 years indicate
that they plan to do so in the next 12 months.
In selecting a new system, the buying considerations are sure to depend to a
large extent on a restaurant’s specific category and size as well as its differing
strategic priorities. For example, full service restaurants may be most
concerned with increasing staff efficiency and customer service. Quick service
or fast casual restaurants, on the other hand, may be more focused on
maximizing the number of guests they can serve during the busiest times of
the day. For them, success generally means driving large volumes of people
through the ordering and checkout line as quickly as possible.
Restaurants are also bound to have a number of requirements in common —
the need to ensure secure payment processing, for example, and to analyze
POS data and gain actionable insights into business performance. This chapter
includes descriptions of these and other key considerations for buyers to keep
in mind as they do their research and evaluate their options for upgrading
their technology capabilities.
16
Chapter 2 Chapter 2: Buying Considerations
Eliminating the need for servers to travel back and forth between tables and a stationary terminal to place orders and process payments can dramatically boost staff efficiency.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Ordering and payment capabilities. As discussed in the previous chapter,
food and beverage services operations need to be able to accept not only
major credit cards and cash, but also gift cards and mobile payment options,
the use of which is beginning to skyrocket. Beyond secure payment
processing, restaurant operators increasingly want to be able to accept
payments as well as process orders directly at the table. Reducing or
eliminating the need for servers to travel back and forth between tables and a
stationary terminal to place orders and process payments can dramatically
boost staff efficiency as well as table turn times. It can also help increase guest
satisfaction since customers generally prefer tableside bill signing over waiting
for paper checks and then waiting again for terminal credit card processing.
Servers should be able to enter orders using any number of modifiers. Some
next-generation systems with inventory control features in some cases provide
dynamic menu monitoring, automatically counting down menu items, and
even ingredients, that may be in short supply, eliminating the chance a server
might take an order the kitchen is unable to fulfill. Most next-generation
systems facilitate routine tasks like check-splitting by item or number of
guests. In addition, most of them offer preset tip percentage options, which
even non-math-challenged guests can appreciate — and which also tends to
work to the benefit of servers in terms of their earnings. Some systems include
built-in distribution and server payout calculators, making it easy to split tips at
the close of business. Others can send guests receipts electronically, via email
or text message, if they so desire. This benefits operators in that these guests
can then be invited to opt into the restaurant’s loyalty and rewards program.
17
Compliancy protects against merchant liability, provides better fraud detection, and accommodates guest preferences as they shift to EMV-enabled payment options.
Chapter 2: Buying Considerations
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Data security capabilities. For many restaurant operators, EMV compliance
requirements for processing chip card (chip-and-signature and chip-and-PIN)
transactions, and the imminent liability shift, was the main impetus to upgrade
their technology capabilities in the first place. Unless restaurants are EMV
compliant, they can now be held liable for fraudulent charges. Compliancy
protects against merchant liability, provides better fraud detection, and
accommodates guest preferences as they increasingly shift to EMV-enabled
payment options. The important point is that transaction data collected by
POS systems need to be well-protected at all times. This means securely
encrypting cardholder data the very instant a guest’s magnetic strip is swiped
or chip is read. And it means keeping that data encrypted until the transaction
is actually processed. Some systems store data on cloud-based servers, others
on on-premise servers. Either way, the systems must be equipped to safeguard
against risks of data breaches by complying with Payment Application Data
Security Standards (PA-DSS) and Payment Card Industry Data Security
Standards (PCI-DSS). Some systems go so far as to monitor transmittal activity
and send an alert if there is even the slightest suspicion of rogue access points.
In addition to safeguarding cardholder data against the possibility of outside
theft, the systems need to also protect against the possibility of employee
theft. One way is to automatically track all the cash that servers collect. Some
systems offer “blind closeout” capabilities, requiring servers to reconcile all
cash across all drawers at the end of each shift without them knowing the
precise amount they are expected to collectively turn over. Besides ensuring
employee accountability, this approach simplifies close-of-day tasks.
18
Chapter 2: Buying Considerations
Every restaurant is sitting on an ever-growing mountain of data related to inventory, menus, guests, employees and various operational and financial aspects of the business.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Performance reporting capabilities. Today, having visibility into all the
key drivers of restaurant performance is not just an operational necessity
but a strategic imperative. Every food and beverage services organization is
sitting on a mountain of data related to inventory, menus, guests,
employees and various operational and financial aspects of the business.
Systematically mining and analyzing the data can generate a continuous
flow of actionable insights. These insights can lead the way to more
informed business decisions, resulting in reduced costs and increased
revenue and profitability. Generating these insights, however, requires the
right data mining, analysis and reporting tools. Increasingly, these tools are
being integrated as a core component of next-generation restaurant
management and POS solutions. The tools are also becoming increasingly
flexible, sophisticated and powerful, making it easy to track and monitor
any number of key performance indicators (KPIs) in a user-defined manner.
At the same time, the reports are becoming increasing comprehensive,
intuitive and visually compelling. Some systems even include notification
features that can trigger a timely response – for example: “Alert me when
voids are greater than 10% of sales.” Every restaurant operator needs to
track basic financial metrics such as net sales to be able to, for example,
compare current performance to past performance. But how many track
such metrics as average table turn rates, occupancy rates, guest spending
or other metrics that impact revenue? Whether looking at menu item
profitability, table seating configuration, server productivity or any other
KPI, operators need to know to what extent a system will let them make ad
hoc queries, generate reports and refresh dashboards using any number of
relevant data sets, over any time period, to get the answers they need.
19
Chapter 2: Buying Considerations
Buyers should keep in mind that selecting a new restaurant management and POS solution means entering into a potentially long-term relationship with a solution provider.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Setup, support and training. Purchasing a new restaurant management
and POS system means entering into a potentially long-term relationship
with a solution provider. That being the case, buyers should select a
company that offers a sufficiently high level of customer support, from
implementation (migrating old POS data into the new system can present a
challenge) to addressing any day-to-day operational issues that may arise
down the road, including ones related to data analysis and reporting. Most
reputable solution providers are willing to facilitate the setup process as
well as oversee any required customization — helping, for example, to
optimize the system according to the restaurant’s physical floor plan. Some
will even test network speed and data backup processes. In addition to
ensuring the availability of reliable support, preferably 24/7, buyers should
ensure that employees will be able to receive the training they need to use
the new system effectively. At the very least, that means walking them
through features and settings and showing them how to troubleshoot the
problems they may encounter.
Usability. The system should be easy to use. The interface should be
attractive and intuitive. Screens should be laid out in a logical and easy-to-
understand format, whether they relate to placing orders and processing
payments or any of the back-office functions, such as accounting, reporting
and employee management. Some systems have graphical layouts for
tracking individual table status. Quick-feature icons that can enable faster
order placement. For servers and management alike, as well as guests, the
overall quality of the user experience should be of paramount importance.
20
Chapter 2: Buying Considerations
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Customization and flexibility. Every food and beverage services organization has its own distinct set of
wants, needs and preferences as well as its own personality. Buyers may desire a significant degree of
customization to reflect that personality. They may want to configure some screens in a way that may be
somewhat unconventional. They may want to be able to generate non-standard reports. They may want
to be able to integrate with third-party software modules and/or hardware components, such as existing
kitchen video displays. Determining the degree to which a given system allows customization, as well as
its relative constraints and limitations, can rank as a critical buying consideration.
Research Data Point “To what extent has upgrading your POS system (within the past 3 years) enabled your restaurant to improve overall performance and business results?”
Quick service and fast casual restaurants
19% 40% 32%
26% 47% 25%
Full-service restaurants
Dramatic improvement Significant improvement Only minor improvement
57% of respondents cite “significant” or “dramatic” improvement Only 9% cite no improvement
73% of respondents cite “significant” or “dramatic” improvement Only 2% cite no improvement
Research findings are derived from the Q1 2016 survey on Restaurant Management and POS Systems.
21
Chapter 2: Evaluation Checklist
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
This Evaluation Checklist offers a framework for conducting an apples-to-apples comparison of restaurant
management and POS systems using the buying considerations outlined previously. Other key
considerations can be added based on individual buyer priorities. Relative weightings can be assigned on
a scale of 1 (“This buying consideration has no bearing on our purchase decision”) to 10 (“This buying
consideration is a very important factor in our purchase decision”).
Buying Consideration Weighting Vendor 1 Vendor 2 Vendor 3
1. Ordering capabilities
2. Payment capabilities
3. Security compliance
4. Performance reporting and analytics
5. Type of hosting (cloud, on-premise or hybrid)
6. Integration capabilities
7. Multi-location management capabilities
8. Customizability / user experience
9. Setup, training and support
10. Usability / client satisfaction
11. Costs and expected ROI
12. Overall features and functionality
a. Marketing, loyalty and rewards programs
b. Inventory management
c. Labor management
d. Cash drawer management
e. Table management
f. Other _____________________________
Overall Rankings N/A
22
Must-Ask Questions
Chapter 3
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
23
Chapter 3: Must-Ask Questions
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
With restaurant management and POS systems
accounting for the largest portion of the budget for
restaurant IT investments, there is no shortage of
related solution providers vying for the attention of
prospective buyers. By asking the right questions,
restaurant operators can quickly rule out some options
while narrowing down others. Just as the buying
considerations are bound to vary depending on
restaurant size and category, as well as the operator's
own strategic priorities, so, too, are the “must-ask
questions,” especially those that relate to specific
features and functionality. The operator of an
establishment that offers food delivery, for example,
may have specific questions about delivery dispatch
and management features. Operators who wish to
migrate to tableside service capabilities will likely have
more questions about those features than ones who
prefer to use centralized order and payment
processing terminals. Similarly, operators who often
work off-site or who manage multiple locations may be
more interested than those who generally work on-site
in asking about cloud-based reporting capabilities and
remote access to, say, menu and table layout functions.
Following are a few of the broader questions, equally
applicable across all restaurants, that prospective
buyers may wish to explore with solution providers.
94%
88%
81%
76%
Generating actionable insights from POS (and other) data into guests, operations, menu, staff, etc.
Using guest profile information for targeted promotions and loyalty and rewards programs
Research Data Point Percentages of restaurateurs who view each of the following success factors as “important” or “very important.”
Accommodating guests’ ordering and payment preferences
Driving increased staff productivity and operational efficiency
Research findings are derived from the Q1 2016 survey on Restaurant Management and POS Systems.
24
Chapter 3: Must-Ask Questions
Buyers should have clear expectations when it comes to customer support and problem resolution as well as the training that may be needed to get servers and staff up to speed.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
What type of customer support is offered? Are there any extra costs? How quickly will questions be answered and problems be resolved? Buyers
should have clear expectations when it comes to customer support and
problem resolution as well as the training that may be needed to get servers
and other staff up to speed on the new solution. More than three-quarters
(73%) of survey respondents agree that adequate user training ranks as a key
success factor. Does the solution provider (or a certified subcontractor) offer an
online or, better yet, in-person training program? Is it equipped to offer online
troubleshooting and diagnostic techniques should technical issues arise? Are
local, in-person service and support services on hand should there be an issue
that can’t be handled remotely? Knowing that problems will get resolved fully,
and in a timely manner, is critical for a food and beverage services organization
that needs to run with minimal interruption and in which even a 30-second lag
in payment processing may be enough to erode the guest experience. Buyers
need to understand what to expect should they ever get into a situation that
requires immediate attention. Tip: Ensure that resources are available to address
training and support needs and resolve issues in a timely manner. Some solution
providers guarantee specific response and resolution times.
What is the solution provider’s track record for stability and reliability? A
solution provider’s reputation and record of customer satisfaction are
important. Nobody wants to implement a restaurant management an dPOS
system that falls short of expectations due to known shortcomings in stability,
reliability or promised benefits. While the solution provider need not have
been in business for decades — most of the tablet-based POS players are
relatively new entrants — it should nonetheless have a sizable roster of
customers that can attest to the reliability and performance of the solution. Tip:
Seek information about what performance issues may arise though conversations
with existing clients, preferable ones in the same restaurant category.
25
Chapter 3: Must-Ask Questions
Buyers would be well advised to find out to what extent customized reporting is possible and what is involved in the process of filtering and sorting data according to a specified set of parameters.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Does the solution offer flexibility in functionality, including data access and performance reporting? The degree of visibility offered by next-
generation restaurant management and POS systems is unprecedented. Such
visibility offers a whole new level of management control. To advantage,
however, restaurant operators may have certain software configuration and
customization needs that must first be implemented. As such, they may want
to confirm that any solution providers under consideration can meet these
needs and preferences. With respect to employee scheduling, for example,
some managers may prefer to modify or create their own templates of work
periods, if that option were to exist with a particular solution. Or, as another
example, they may have a certain way of wanting to input menu modifiers.
Most systems come equipped with a large number — in some cases, dozens —
of standard dashboards and reports around operational and financial areas like
sales and revenue, labor and inventory control that should meet most
operators’ day-to-day performance management and analysis needs. That said,
not all POS data queries and reporting requirements can necessarily be
anticipated in advance or be addressed with out-of-the-box dashboards. For
that reason, buyers would be well advised to find out to what extent
customized reporting is possible and, also, what is involved in the process of
filtering and sorting data according to a specified set of parameters. With 81%
of restaurant operators ranking the need to gain access to POS data and
business insights — generally now available anytime, on any device — as an
“important” or “very important” success factor, it only stands to reason that
they would also want to ensure that any solution under consideration is able to
meet these expectations in terms of POS data analysis and reporting
capabilities. Tip: Confirm that the solution is flexible in terms of keys areas of
functionality, including custom report generation, and verify the solution
provider’s claims, if possible, by speaking with existing clients.
26
Chapter 3: Must-Ask Questions
There are many reasons for the shift to increased affordability, including the fact that installation is generally less complex and hardware is generally less expensive than in the past.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
What is the total cost of ownership? Are there any “hidden expenses”? While hardware and software costs run gamut, as do the requirements of
different restaurant operators, next-generation restaurant management and
POS systems on the whole tend to be significantly less expensive and require
less up-front investment than their predecessors. There are many reasons for
the shift to increased affordability, including the fact that installation is
generally less complex and hardware is generally less expensive compared to,
say, a decade ago. With a fast-growing number of systems, the POS data is
stored entirely in the cloud, reducing (or, likely, even eliminating) the need for
on-premise servers. Incidentally, most cloud-based POS systems also use a
subscription “pay as you go” model, which generally means no long-term
contracts and no upfront capital investment for the software. This may be an
important consideration, especially for smaller operations with a limited
budget. In all cases, it is important to confirm which software features and
modules, including future upgrades — as well as which hardware components,
if any — are included in the base (recurring) price that is quoted so as to avoid
any unpleasant surprises down the road. Tip: Ascertain that all associated
installation, licensing, maintenance and ongoing service and support fees are
included in the pricing. Also, check that the solution comes with a warrantee to
protect against hardware or software malfunction, what specific replacement or
repair costs are covered, and over what period of time.
27
Roadmap and Recommendations
Chapter 4
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
28
The food and beverage services industry is teeming with technology innovation. Solution providers
are not only adding a host of new software features and functionality to their platform capabilities,
but many of them are also introducing new kitchen display systems, customer-facing kiosks, menu
apps, and so on. With technology development in a constant state of flux, the task of selecting a
next-generation restaurant management and POS system can, for some restaurant operators, seem
an unusually difficult challenge. The fact of the matter is that most of the technology innovation is
headed in the same general direction. The Roadmap Diagram below highlights some of the key
trends and shows various aspects of the migration path in restaurant technology capabilities.
Chapter 4: Roadmap
Legacy Solutions Next-generation Solutions
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Stationary terminals only for order and payment processing
Mobile options for order and payment processing
Credit card and cash only payment acceptance
Chip-and-pin and mobile payment acceptance, as well
Rudimentary data analysis and performance reporting
Robust and custom data analysis and performance reporting
POS separate from CRM, marketing and loyalty programs
POS integrated into CRM, marketing and loyalty programs
On-premise-only access to POS data and reporting
Anytime, anywhere access to POS data and reporting
Emphasis on managing day-to-day restaurant operations
Emphasis on driving performance improvement and revenue
29
Chapter 4: Recommendations
The systems have migrated from being little more than payment processing and ordering platforms to becoming the epicenter of day-to-day operations and decision-making.
The 2016 Smart Decision Guide to Medical Practice Management Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
The proliferation of mobile devices and new payment options, access to ever-
growing volumes of customer data, advances in analytic capabilities, and
increases in processing power, along with ever-rising expectations on the part
of restaurant operators and guests alike, have all conspired to usher in a new
era in food and beverage services technology. Next-generation restaurant
management and POS systems have migrated from being little more than
payment processing and ordering platforms to becoming the epicenter of day-
to-day operations and strategic decision-making. Following are a few
recommendations to not only keep in mind along the evaluation-and-
purchase journey but also once the new solution is implemented.
Focus on building the guest database. Restaurant operators can capture an
enormous amount of valuable customer information from POS transactions as
well as additional interactions, such as surveys and rewards programs. By
enhancing guest profiles with additional data and understanding guest
commonalities by looking at psychographic makeup, and then creating useful
segmentation schemes, restaurants can maximize the value of guest
relationships. The goal is to provide carefully tailored services, communications
and promotions while minimizing the cost of resources otherwise expended to
build, maintain and increase the value of those relationships. Capturing and
storing individual guest information in a centralized data repository, and
acting upon that information to the benefit of both guests and the business,
should become a core competence for every restaurant operation.
30
Chapter 4: Recommendations
While tech-savvy managers, servers and other employees should be able to get up to speed on a new system relatively quickly, others may need some hand-holding.
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Know thyself. While every prospective buyer needs to ensure that any
restaurant management and POS system under consideration covers all the
basics around food ordering, secure payment processing, etc., every restaurant
also has its own requirements and priorities in terms of features and
functionality. A multi-location restaurant operation, for example, will probably
want to purchase a system that features multi-restaurant management
capabilities — with single sign-on, for example, and unified data analysis and
performance reporting. Buyers should try to gain a clear understanding of their
own requirements and priorities early on and weigh them accordingly (see the
Evaluation Checklist in Chapter 2).
Check client references. This recommendation may seem obvious, but it
nonetheless bears mentioning. No input may be more important to the buying
decision than the perspectives that can be gleaned from existing clients,
preferably restaurants that share commonalities in terms of size, typography
and existing technology infrastructure. A solution provider may be willing to
provide one or more client references. And some restaurant operators may be
willing to share their experiences, including both the pros and cons. Written
client testimonials and success stories can also be valuable resources.
Provide adequate training and practice. While tech-savvy managers, servers
and other employees should be able to get up to speed on a new restaurant
management and POS system relatively quickly, others may need some hand-
holding. As discussed, it’s important that the solution provider — or another
resource, if necessary — provides the requisite level of training support and
that sufficient time is allotted for servers to become comfortable with the
idiosyncrasies of the new system before being set loose on paying guests.
31
Inside Voices and Outside Voices
Chapter 5
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
32
Figure out exactly what your operation needs before you start exploring POS
technology options. Some new features are awesome and can have a real impact. But
some solutions offer a lot of capabilities that may not help you achieve your goals. The
bells and whistles may actually be a distraction to your servers and other staff.
Manager, full-service restaurant
Senior executive, fast casual restaurant
Owner, full-service restaurant IT manager, full-service restaurant
Last year, we made the decision to upgrade. The main drivers were EMV
compliance and POS mobility. What we weren’t expecting was the positive response we got from guests who
appreciate the shorter wait times and better service experience.
The most important thing to consider, aside from payment processing needs, is guest
satisfaction. Will the new solution turn the dial on guest satisfaction? Will it improve the
experience people are having with the restaurant? Will it leave guests feeling
happier? If the answer is “yes,” then upgrading makes a lot of sense. Any technology that improves guest satisfaction and gets them
coming back more often is money well spent.
A lot of different trends and factors are shaping the technology needs in our industry. Rising labor costs is one of them. To reduce overhead, some
restaurants would prefer that guests use their own mobile devices when
ordering as well as when paying. This is something we’re going to see a lot
of in the future – guests sending their own orders directly to the kitchen display. And then maybe robots preparing and serving the food!
Chapter 5: Inside Voices
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Restaurant operators, including owners, managers and staff, with first-hand experience with next-
generation restaurant management and POS systems have a lot to say about the topic. Following are a
few perspectives gleaned from individuals who participated in the survey that produced the research
included in this Smart Decision Guide.
33
We hear all the time that choosing a POS system feels like a very overwhelming
process. With all the different options on the market today, there can be a lot of
pressure to select the ‘right one’ that will work for the front-of-house and back-of-house staff. It’s an important decision to
make because much of the way a restaurant runs will likely depend on the functionalities of the chosen POS system.
Justin Guinn, Market Research Associate, Software Advice
Evan Schuman, PC Magazine
Forrester Research, Study: Step Up The In-Person Experience
Chris Caliz, TechCrunch
For restaurant operations, the right POS system can be a make-or-break decision.
During the most critical times for your business… the POS system needs to
perform in just the right way. A slow user interface can mean fewer meals sold and unhappy customers, but a feature-anemic
system can cause back-end accounting problems or even drop essentials such as
credit card processing.
[An] advanced point-of-service (POS) system…that mimics systems of insight and
systems of engagement will improve customer experience, empower employees, and increase the efficiency and performance of operations.
A restaurant’s choice of POS can impact and dictate a majority of other
tech choices for it. The reasons are varied, from rich packages that include multiple features to limited integration
options with other products.
Chapter 5: Outside Voices
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Following are a few additional perspectives from industry observers, including trade magazine editors and
leading research analysts, with insights into next-generation restaurant management and POS systems.
34
Research Notes and Underwriters
Appendix
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
35
In Q1 2016, Starfleet Media conducted an online survey, consisting of both multiple choice and open text
questions, to capture the perspectives of industry practitioners with firsthand experience with restaurant
management and POS systems. Some of the research findings are highlighted in this publication. Following
is some basic information about the 162 qualified survey respondents who participated.
Appendix: Research Notes
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
39% 41% 17%
Servers and other staff
Managers and other leadership
Owners
Bars and nightclubs Full-service restaurants
7% 42% 51%
Quick service and fast casual restaurants
North America Other
73% 20% 7%
Europe
Job level / role of survey respondents
Size / category of survey respondents’
restaurant employers
Geographic location of survey
respondents
36
Appendix: Underwriter
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.
Oracle Hospitality offers a range of software, hardware and related services, including a leading portfolio of cloud solutions, designed for the hospitality industry. With over 35 years’ experience in developing point-of-sale systems, Oracle Hospitality offers best in class technology to enable customers to streamline business operations, increase customer loyalty, and elevate profitability. www.oracle.com/hospitality Contact: Oracle Hospitality 7031 Columbia Gateway Drive Columbia, MD 21046 (866) 287-4736 [email protected]
37
This Smart Decision GuideTM is the result of primary and secondary research conducted by Starfleet Research, which is the IT market research arm of Starfleet Media. It was independently produced, without editorial involvement from the company underwriters. Our approach to content production provides for unbiased, fact-based information. It represents the best and most comprehensive information, analysis and recommendations available at the time of publication. Starfleet Media assumes no liability for the use or interpretation of any information contained in this Smart Decision Guide. Purchase decisions based on the information contained herein are the sole responsibility of the individual decision maker(s) and/or the companies they represent. Unless otherwise noted, the entire content of this publication is copyrighted by Starfleet Media. It may not be reproduced, distributed, archived, or transmitted in any form or by any means without the prior written consent by Starfleet Media, except by the company underwriters that have secured perpetual licensing rights to the content. For additional information, please contact Starfleet Media at [email protected].
Was this Smart Decision Guide helpful? Any suggestions for improvement? We would like to hear from you. Please send any and all feedback to [email protected].
The 2016 Smart Decision Guide to Restaurant Management and POS Systems Entire content © 2016 Starfleet Media. All rights reserved. Unauthorized use of reproduction is prohibited.