The restaurant business is risky. About 60% of eateries close within the first year, while 80% don’t see their five-year anniversary. A successful restaurant — especially a pizzeria — requires smart planning and constant reevaluation. There are more than 60,000 pizzerias in the United States and owners all have their own ideas about what makes a perfect pie, so the competition is fierce. The delivery service your restaurant provides can be an important differentiator that makes you stand out in the crowd.
Key performance indicators (KPIs) can help you evaluate the efficiency of your pizza delivery service and pinpoint trouble before it spirals out of control. Sales numbers are only one indicator, so look at the bigger picture to learn more about your pizzeria’s performance.
- Customer Loyalty. Market research says that the most successful small businesses earn 70% of their revenue from repeat customers. When you consider that two out of every three pizzerias are independently owned, customer loyalty can make or break your business. Track how many delivery customers are repeat customers to ensure your service encourages people to use it again.
- Powerful Promotions. Monitor the effectiveness of promotions you offer and how many are redeemed through delivery. If you make offers specific to delivery orders or service, track how many of your customer take advantage of them and how they impact overall sales. Also consider tracking your Net Promoter Score (NPS) that will show how effective you are at online marketing and social media analytics to gauge the effectiveness of your marketing efforts there. This data will also help you calculate ROI of your marketing campaigns — did you get the return you wanted for the amount you invested in the campaign?
- Accuracy. Monitor how many orders have to be remade, how many are sent back, or how many complaints you get from customers. Train your staff to accommodate a customer's special requests or food allergy requirements to avoid waste from orders that are incorrectly prepared. Also remember to accurately price and calculate tax on modified orders to make sure your bottom line doesn't suffer.
- Competition. You may want to track other metrics related to the competition to make sure your business is faring well in your market. Track the number of promotions other pizzerias launch, their menus, their delivery reach, etc. to keep track of how you compare.
- Employees. Metrics related to your employees can also indicate how well the delivery side of your business is working. Track metrics including sick days or call-offs, labor turnover, and length of employment, to assess how delivery is working from the employee’s point of view.
- Labor Costs. Labor is one of a restaurant’s top expenses, so keep these costs under control. Monitor total labor costs and labor hours to make sure delivery is profiting, not draining, your business.
- Mileage Reimbursement. Track the amount of mileage reimbursement you pay and make sure it lines up with routes drivers should be taking. Also use this data to refine your pizzeria’s delivery radius if appropriate.
- Promise Times: Hungry people are impatient, especially if their delivery is late. The right pizza delivery POS system can track driver activity so you can see how many orders arrived late. Establish a KPI for promise times and set goals to meet it. You may also want to watch how many coupons for free items or other make-good attempts you are distributing in response to late deliveries and what their impact is on profits.
Pizzeria owners should look at a range of KPIs to measure their delivery service’s success. Running a profitable restaurant involves a wide range of variables, so don’t limit yourself to one or two benchmarks. Evaluate customer loyalty, overhead costs and how your menu and pricing measures up to the competition to make sure it all adds up to a successful business.