Integration: The Back Office Sweet Spot

According to Hospitality Technology’s 2018 Restaurant Technology Study, 45% of restaurants said they were planning to increase spending on back-of-house software in 2018, and on average, operators planned to increase allocations for back-office software to 27% of overall IT budgets. This is promising, as efficient back-office systems are vital for the success of a restaurant.

However, back-office can mean many things to different people, and restaurants often wind up using a multitude of different  systems, apps and even spreadsheets to monitor the various components of the enterprise, which makes system integrations among back-office software applications difficult and costly. This can cause frustration and headaches for restaurateurs that are looking for a single version of “truth” that they can use to make informed decisions.

Technology vendors are often well aware of this issue and frequently partner with each other to try and alleviate some of this stress, especially among technology companies that provide POS, accounting and inventory software. This article discusses how some restaurants have found the “sweet spot” where their POS, accounting and inventory solutions integrate seamlessly.

Keeping Track of the Numbers

When Michael Strauss opened Mike’s BBQ (www.mikesbbqphilly.com), a storefront for his signature sandwiches and catering, he was looking for a reasonably priced POS and ultimately decided on Toast (https://pos.toasttab.com).

“It could manage a busy restaurant,” says Strauss, “plus it has a full accounting system for back-of-house and tracking sales and payroll.”

He also discovered that the new system had extensive sales tracking that could transfer data to his CPA seamlessly. Plus, Strauss says he can track everything from trends to costs.

“The restaurant biz is about tracking pennies,” says Strauss. “I look at my
numbers every week. I break it down to categories and even items to see where I have opportunities. You can see clearly where you’re making money and losing money.”

One reason why Toast was able to offer Strauss such in-depth accounting and inventory management was because it has partnered with 14 inventory solutions and eight accounting solutions. This provides restaurants such as Mike’s BBQ with options, allowing them to find the one that will meet their needs.

One of the inventory management solutions Toast POS has partnered with is Compeat (www.compeat.com). Compeat has partnered with 47 POS providers and 24 accounting/consulting providers. These types of partnerships have allowed Sprinkles Cupcakes (http://sprinkles.com), an Austin, Texas-based bakery with 23 locations, to successfully manage its inventory and accounting needs. The fully integrated software allows Sprinkles to have total control over its financial reporting, payroll and cost control. 

“We can see what a difference an ounce can make in all the products as well as cost,” says Dan Mesches, CEO. “That kind of insight helps us lower our food costs. We can really drill down and see
our waste.”

Digitize Data Entry

Recently, Compeat also partnered with Plate IQ (www.plateiq.com) which allows Compeat and Ctuit users to leverage Plate IQ’s suite of accounts payable automation tools to manage back-of-house accounting tasks including vendor invoice capture and processing. The interface works with Compeat’s accounting, inventory and intelligence solutions to give operators an improved ability to track expenses, forecast food costs and make menu price decisions.

“Plate IQ’s price tracking and spend analysis tools help us keep track of all price changes for key restaurant purchases on one simple dashboard,” says Souvla (www.souvla.com) CEO and Founder Charles Bililies. “Since partnering, we have been able to streamline our supply chain and eliminate dishonest vendors who were increasing prices without telling us.” 

Manual entry of invoices is often a sore spot for restaurant managers who would rather be using their time to monitor and mentor employees or engage with guests. Some restaurant accounting solutions, such as xtraCHEF (https://xtrachef.com) offer restaurants the ability to remove manual data entry altogether. After implementing xtraCHEF’s software, La Colombe (www.lacolombe.com), a Philadelphia-based coffee roaster and retailer with 30 cafes, said its corporate AP team and its in-store managers will be able to take a photo, email or scan and upload invoices to xtraCHEF which will then automatically digitize, store and extract line-item details from the invoices and deliver the data to Sage 100 (www.sage.com), an enterprise resource planning software used by La Colombe to manage its back-office operations.

A Single View

A well-designed accounting solution should also enable restaurant operators to easily view budgets in real-time and make the necessary adjustments to ensure better profitability. 

The PJW Restaurant Group (www.pjwrg.com) has found a way to streamline its back-office technology to create one standardized system that can connect all parties. Jessica Breslow, director of IT and marketing for PJW in Westmont, N.J., says each restaurant (P.J. Whelihan’s operates more than 20 locations alone) currently uses NCR’s Aloha (www.ncr.com), which connects all operations into a single, intuitive platform. However, the more things a single system can do the more points of integration and potential for failure. This is causing many restaurants to rethink the way they use their POS.

“POS is changing,” she says. “Its role is diminishing slightly as back-office solutions like Compeat and Restaurant 365 (www.restaurant365.com) come on the market, and your POS is no longer the backbone of the organization and the official record for everything from inventory to accounting.”

Nova Restaurant Group (https://novarestaurantgroup.com) CFO Bruce Nelson implemented Restaurant365 when he was seeking a software that could easily integrate and connect with each of his seven restaurants and 600 employees. Restaurant365 partners with 49 POS providers to aidrestaurants with accounting.

The Restaurant365 system knows if you transfer products and expenses from one entity to another, and intuitively adjusts the balance sheets and accounts during the process. For Nelson, this allows his staff to directly see how budgeting is affecting salary while using the software to compare budget in real-time. 

“This has taught them how to watch the budget weekly rather than waiting until the close of the period, keeping them more on track throughout the operational period,” he says.