Restaurant Operators Seek Smarter Software Solutions to Streamline Payments Complexity

Restaurants today face the challenge of maximizing productivity and efficiency, requiring intelligent workforce management solutions. Tony Smith, co-founder and CEO of restaurant management software company Restaurant365, discussed the increasing revenue and labor challenges in a conversation with PYMNTS‘ Karen Webster. Smith highlighted the importance of adapting to new channels, such as online ordering, curbside delivery, and expanded outdoor seating areas, which have contributed to a 20% increase in sales compared to pre-pandemic levels.

PYMNTS’ research study, «Connected Dining: Rising Costs Push Consumers Toward Pickup,» revealed that 51% of diners ordered meals for on-premise dining, while 39% used pickup channels and 10% opted for delivery. To tackle labor challenges effectively, innovative tipping solutions, including instant payouts, have become crucial for retaining staff. Smith emphasized the significance of tips and mentioned the company’s pay cards and daily payment options for employees.

According to PYMNTS data, tipping is widely prevalent in the US restaurant industry, with 75% of consumers leaving tips for their last restaurant meal. Despite the current difficulty in securing venture capital funding, Restaurant365 successfully raised $135 million in a recent funding round, led by investment firms KKR and L Catterton. The company’s valuation now exceeds $1 billion. The interest from investors demonstrates the high demand for solutions that enhance restaurant efficiency in a growing industry.

With rising costs and macroeconomic challenges impacting restaurant margins, cost-focused software tools that provide insights into pricing and data-driven predictions have become crucial. Smith noted that menu prices have increased by an average of 8% for consumers, while food and labor costs have risen by 11-12% across the 40,000 restaurant locations using Restaurant365’s products. These margin challenges are compounded by the fact that many consumers are unwilling to pay the increased menu prices.

Running a restaurant presents unique challenges compared to other businesses, making restaurant-specific software solutions highly sought after. Smith emphasized the need for specialized functionality tailored to the restaurant industry. According to data cited in the «Money Mobility Tracker®,» a collaboration between PYMNTS and Ingo Money, 75% of restaurant operators plan to adopt technology this year to address labor and cost challenges.

While specialization is crucial, restaurant operators also value all-in-one solutions that simplify their operations. As non-technologists, they seek comprehensive software that streamlines processes and enables intelligent and efficient workflows. Smith highlighted two highly requested capabilities: simplified workforce management and greater visibility into key metrics. The introduction of business intelligence features allows restaurants to visualize their data, and future updates will offer benchmarking capabilities.

Looking ahead, Smith anticipates further refinement of restaurant technology rather than radical advancements. At the recent National Restaurant Association Show in Chicago, he observed evolutionary advancements in analytics and intelligence capabilities. The focus remains on leveraging data and insights to drive operational improvements, ensuring the continued growth and success of the restaurant industry.

Restaurant operators are embracing smarter software solutions to navigate the complexity of payments and streamline operations. By leveraging innovative technology, they can effectively address labor challenges, improve efficiency, and gain valuable insights into their businesses.