TimeValueOfMoney

3 Ways to Minimize the Impact of Pricing Volatility

Walk around your local grocery store these days, and you might notice something... prices are up. Way up, in some cases, with the one-month increase in March for certain staple items the largest seen in nearly a decade.

While the pandemic is again a culprit in driving supply chain disruptions, a range of other issues are causing sticker shock at the checkout aisle: more expensive gas, higher commodity prices, bigger overseas appetites for imports, and crop damage in the Midwest, to name a few. 

Whatever the causes may be, it’s obvious that restaurants need better tools to manage and confront change. Do you have the right tools and technology to manage impacts to cost, revenue, and operations during yet another period of change and uncertainty?

Today, we’ll take a look at three steps that restaurants can take to reduce the impact of pricing volatility:

  1. Think: How have prior disruptions impacted my business?
  2. Prepare: What are things I can do to reduce business impact at this time?
  3. Act: How can I get ahead of change, instead of falling victim to it?

blog-3-1

Change happens...but it’s happening faster.

Although the pandemic has undeniably impacted every aspect of restaurant operations more than any other force in recent memory, one area where change has been particularly noticeable is technology. 

To survive during COVID-19, brands pivoted their focus and turned to tech to handle a new operational reality. Some restaurants were able to make that shift swiftly, others not so fast. Lighter, open, and versatile technology stacks were key differentiators that helped certain brands respond quickly during the early days of the pandemic, while their heavy, unintegrated, and lethargic counterparts, unfortunately, prevented other brands from capitalizing on the accelerated shift to digital.

Now, with the end of COVID restrictions in sight (but with commodity price fluctuations and other issues looming over the industry), it’s obvious that the right approach to technology helps organizations quickly adapt to new circumstances, and prepare for changes on the horizon.

Stay ahead of the curve.

Preparing for change isn’t a singular act or something you do once; it’s a series of proactive steps, combined with a mindset that helps you stay nimble and responsive. For forward-looking brands, technological foresight provides the ability to act decisively and intelligently when confronted with uncertainty.

What does a restaurant technology stack that's prepared for change look like? Some characteristics that define preparedness include:

  • A unified approach to systems, including point of sale, enterprise management tools, ordering channels, and operational platforms
  • An open, flexible architecture that encourages easy, normalized data flow within your ecosystem
  • Applications and tools that allow for proactive and reactive changes, in light of shifting business conditions

AdobeStock_229152162

Uncertainty in many areas of the restaurant industry can’t be managed by technology alone. However, having the right tech helps brands handle turbulence and alleviate repercussions related to external factors that have a direct impact on their business. 

Qu’s Enterprise Management system was built with agility and nimbleness in mind, and gives brands a single point of truth to manage the complexities of restaurant operations. One key feature of this tool is the ability to manage stores, menus, and pricing dynamically, reducing the amount of time and effort required to maintain consistency and to get ahead of things like price increases.

The tool is set to receive valuable updates that will further simplify price management:

  • Versioning: Versioning reduces the number of items and prices that need to be managed within Qu’s Enterprise Management system. This decreases the number of ‘versions’ within the tool, easing the need for long-term maintenance. This is particularly useful when updating pricing across a technology stack, especially when there are multiple ordering channels to manage.

  • Grouping: Allows brands to assign prices to groups of items. This update can be thought of as a “Price Book”, meaning that restaurants can assign one price across multiple items and item versions. All prices can be grouped together outside of a menu structure, making them easier and faster to update, allowing restaurants to respond quickly when prices go up or down.

Pull ahead of the pack.

While external factors like supply chain disruptions, droughts, and global pandemics are beyond a restaurant’s control, having the right mindset, tools, and technology gives brands the ability to mitigate the impact of events like pricing increases, and can potentially make the difference between getting ahead of change and becoming a casualty of it. 

It's critical for restaurants to think ahead of potential changes that may be coming down the horizon, particularly in light of increased competition and the unparalleled convenience at guests' fingertips. The right preparation and approach can equip brands to reduce the impact of volatility while making the right moves afterward can help brands truly pull ahead of their competition.

SAND OR STONE BANNER-1

SHARE:

Subscribe to our blog!