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Restaurant MIS and KPIs

Ten KPIs every restaurant owner should track

The metrics that explain whether a restaurant is healthy, and what each one tells you that sales alone cannot.

By Abhishek Mundada, CA, CFA. Published . 7 min read.

Daily sales tell you how busy you were. They do not tell you whether the business is making money, where it is leaking margin, or whether it can fund the next outlet. These ten KPIs do.

Sales

  1. Net sales by channel. Dine-in, takeaway and each delivery platform, after discounts and commissions. Channels with similar gross sales can have very different contributions.
  2. Average order value. Net sales divided by number of bills. Shows the effect of menu engineering, upselling and pricing.
  3. Covers or orders per day. Separates footfall changes from spend-per-head changes.

Prime costs

  1. Food cost %. Cost of food consumed as a share of food sales.
  2. Beverage cost %. Tracked separately because margins differ widely.
  3. Staff cost %. Salaries, wages, incentives and staff welfare as a share of net sales.
  4. Prime cost %. Food, beverage and staff cost together. Because these are the largest controllable costs, prime cost is often the clearest early warning sign.

Profitability and cash

  1. Occupancy cost %. Rent, common area maintenance and related charges as a share of sales. Mostly fixed, so it falls as sales rise.
  2. Outlet EBITDA and EBITDA margin. Profit before interest, tax, depreciation and amortisation, by outlet. The best single measure of whether a location works.
  3. Cash generated and cash balance. Profit is not cash. Track the cash the business produces after supplier payments, statutory dues and loan repayments.

Making KPIs useful

  • Compare each KPI to a target and to the previous month, not just in isolation.
  • Report outlets side by side on the same definitions.
  • Keep definitions consistent from month to month so trends are real.
  • Add a short commentary explaining what moved and what will be done about it.

Every KPI above depends on the underlying data being captured. If your POS, purchase records or payroll do not separate outlets or channels, start by fixing that.

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This article is general information and not professional advice for any specific situation. See our disclaimer.