Is your restaurant full? The space at your restaurant is not free.
If your restaurant has 80 covers, how many covers do you need to sell to be full? Well that is entirely up to you.
One of the most challenging things for restaurants is defining what full means.
Is it turning my covers once a day full? Is it twice a day?
If we define 100% occupancy, a restaurant that turns all the tables from opening to closing, this would be impossible for most restaurants, and they would be sitting at around 15% occupancy for the day. Very depressing!
Calculating occupancy per hour is more realistic. However, this short article intends to simplify the occupancy process as much as possible.
Some booking systems are also starting to add occupancy or seat utilisation in their dashboards, creating awareness about the importance of tracking occupancy in each restaurant.
The first step we need in restaurants is to standardise such essential terms.
Start speaking in turns instead of total covers and Revpash instead of sales when benchmarking against other restaurants; help us compare apples to apples and avoid keeping restaurants open for longer than they should.
The most practical way to calculate your occupancy is to calculate daily turns. Daily turn is a global indicator that does not need percentages and can be easily compared across other restaurants or restaurants within the same group. When calculating daily turns, you should include all the seats in which you serve food in your cover capacity.
This analysis is critical for new openings too. For restaurants, big does not mean better, as you might end up with a big restaurant that is half empty most days.
Calculating turn is critical to understanding the efficiency of your space in comparison to other restaurants. The space in your restaurant is not free, so if you cannot get your tables to turn in line with your competitors or the market after trying to do better, you might want to reduce your hours of operations or become super creative with the extra space. Create a book club, sublet the area to a new clothing line or run a yoga class. Anything is possible!!
Turning a restaurant profitable is an achievement. But let´s not stop there and understand what more we could do to overcome the competition and use our facilities better.
Author: Carmen Mallo