New technology could play a crucial role in getting hospitality businesses on the road to recovery, says Adam Croney, Partner at Thomas Westcott Chartered Accountants.
We can be proud of our hospitality businesses here in Devon and the sector is hugely important to the local economy.
Sadly, restaurants, pubs, hotels and cafes have been cited many times as the businesses that have been hit hardest by restrictions during the pandemic.
We have been supporting our hospitality clients through the challenges and what is clear is that those businesses that have adapted and innovated have fared best.
Being open to new ways of working and embracing new technology will be crucial to the sector’s recovery in the coming months.
Many restaurants, pubs and hotels still operate with manual systems but digital technology could play a crucial role in their future success.
Working smarter, not harder
Hoteliers, restauranteurs and their employees work incredibly long hours. Those who have been on furlough may have had the chance to reflect and consider a lifestyle change.
Wellbeing is now a priority for many of our clients and that means working smarter and being more efficient. To achieve that, businesses will need to move from manual to digital systems.
Scheduling complex employee work patterns and managing payroll has always been a headache for hospitality business owners.
New technology means they can now create interfaced joined-up work schedules and payroll systems. That not only makes it easier to create rotas, by instantly showing staff availability, but also reduces the risk of payroll errors.
Food and beverage businesses operate in a fast-paced environment with a high volume of invoices as a result of fresh items being delivered on a daily basis, from multiple suppliers. Managing payments can therefore be a time consuming and stressful task.
The right software allows business owners to check their finances anytime, anywhere by providing an instant and up-to-date snapshot of cash flow.
It can also provide an automated payment system, reducing the amount of time spent managing invoices.
Becoming a destination
Restaurants and hotels have traditionally been seasonal, relying on key events, such as the summer tourist season and Christmas, to carry them through downtimes. But one thing we have learned over the last year is that we cannot take anything for granted.
Amidst so much uncertainty and the threat of future lockdowns, hospitality businesses can no longer rely on future events so many are overhauling their seasonal approach.
Some are focusing on creating special events – perhaps themed around a particular cuisine or offering customers an educational experience. This could be a smart way to bring in revenue in quieter times.
So, how can digital technology help restaurants become a destination? Well, it starts with getting a good handle on margins to identify the source of profits and losses.
Software systems provide constant, up-to-date view of income, expenditure and stock. Monitoring this data helps pinpoint downtimes, which can be a starting point for finding opportunities to address potential periods of loss.
Many restaurants have diversified during the pandemic. Some have offered takeaway meals for the first time, while others have created cook at home meal kits or sold wine or food items online for delivery.
I think this trend of branching out into e-commerce will continue after the pandemic. With growing numbers of restaurants taking bookings online, there is potential to expand the e-commerce offering to include cook books and high end food items.
To do this successfully, the right technology is crucial.
Marketing your business
I firmly believe that people will be choosier as they return to restaurants and will seek out those places that offer an experience, rather than just a meal.
Restaurants and hotels that are running events and expanding into e-commerce are already tapping into this shift and can now develop customer relationship management (CRM) systems that will enable them to deliver highly-targeted marketing campaigns.
Use of point of sale technology has accelerated in recent years and customers increasingly expect to be able to pay via an app. Many hospitality businesses are responding with new point of sale software that syncs with accounting and CRM systems.
This not only enhances the customer experience, by making it easier for them to pay, it also cuts down on administrative work and has the potential to support your marketing strategy.
We will, sadly, lose some of our hospitality businesses as a result of the difficulties the sector has faced. However, my experience of working with restaurants, hotels and pubs is that there is a sense of optimism about the future.
Those businesses that focus on the opportunities out there – including new digital solutions – are the ones that are most likely to thrive.