Coffee Shop Software ROI coffeefest 2014

Coffee Shop Software:Making It Pay Off For You!

CoffeeFest Seattle 2014www.coffeeshopmanager.com

Kim HojaboomCoffee Shop Manager

Agenda

CoffeeFest 2014www.coffeeshopmanager.com

When is it time to purchase Coffee Shop Software?

How Can You Get the Most ROI?

Tips for Choosing the Right System

Technology Evolution


From Cash Register To Point-of-Sale System• Ring up orders• Give Customer A Receipt• Minimal Reporting• No Management Tools• Separate credit / gift• No customer data• Inexpensive

• Much easier to ring custom orders• Extensive reporting and analysis• Integrated credit, gift, loyalty• Sophisticated customer tracking• Employee timeclock & scheduling• Inventory tracking• Many management tools

Does Your Shop Need A POS?


Main Reasons Owners Buy POS:• To Improve Accuracy• To Reduce Costs • To Increase Profitability• To Improve Customer Service• To Implement Marketing Initiatives• To Better Analyze the Business• To Gain More Time• To Manage Remotely• To Manage Multiple Locations

ROI of POS Software


Improved Accuracy:• Easy to ring orders correctly• Ensure all upcharges get charged for• Ensure that discounts are applied correctly• Accountability process – no orders made without a ticket

Example: • Susie forgets to charge for caramel flavor ($.30) on average 3 times per shift.• 5 Susies per day = $4.50 per day = $31.50 per week = $1638 per year

Example: • James wants to be nice to his favorite customers, so he applies the senior discount every day – not just on Tuesdays.• 10 discounts per day = $4.50 per day = $31.50 per week = $1638 per year

ROI of POS Software


Reduced Costs:• Printed tickets for baristas; cup labels ensure no orders made incorrectly. • Inventory tracking – “Cup count” report reveals uncharged items; Retail inventory tracking• Improved management processes cut down on manual paperwork & managerial time

Example: • Rob heard “non-fat” instead of soy latte. Have to remake it. Cost: $.75• 2 Robs per day = $1.50 per day = $10.50 per week = $546 per year

Example: • Mary compares the cup count report and finds that 5 grande size drinks were not rung up today. She meets with the staff & behavior improves.• 5 Grandes per day = $22.50 per day = $157.50 per week = $8190 per year

Example: • Mary has to stay late to catch up on paperwork reconciling the old cash register to the credit card machine, counting up time sheets, etc. • 3 hours overtime = $65 per week = $3380 per year

ROI of POS Software


Increased Profitability• Strict cash management controls reduce theft• Integrated timeclock to manage labor• Reorder reminders keep you from running out of items• Integrated credit card processing more secure / less costly

Example: • It’s a slow day – Mary checks sales and labor reports and decides to send one barista home early.• 3 labor hours = $34.50 per day = $103.50 per week (3x) = $5382 per year

Example: • You ran out of Organic Orange Juice bottles and won’t get more for 3 days. Poor inventory controls means this happens monthly with one item or another.• 10 juice sales missed = $35 per day = $105 per incident = $1260 per year

ROI of POS Software


Improved Customer Service:• Speed of service• Track customer accounts• Integrated pre-paid / gift cards• Integrated mobile / online orders

Example: • Customers buy your Pre-paid card special “Free Latte” with $40 card fill. • 100 cards sold: Your $35 card cost plus $75 cost for the lattes• $100 in processing fees saved when customers use cards instead of credit• 5% of card value are never redeemed ($200). Your Net: $190. Repeat weekly for $9880 per year savings

Example: • You implement a mobile ordering app to give customers easy ordering on-the-go and the chance to skip the line.• 100 regular customers order one more time per week because of the convenience• Weekly revenue boost: $450 Yearly: $23,400

ROI of POS Software


Improved Marketing Initiatives:• Integrated customer loyalty • Track discounts and promotions• Use gift cards promo to attract new customers

Example: • You implement a loyalty program and start communicating with and rewarding your best customers. 500 customers join and increase average frequency from 3 visits a month to 4.• 500 Additional Visits = $2250 per month = $27,000 per year

Example: • You issue 500 $5 gift cards in the local community to attract new business.• Your cost is $175 for cards and $375 in product = $550• 5% (25 customers) become once-a-month regulars: $1350 per yr.• 3% (15 customers) become once-a-week regulars: $3510 per yr.• 1% (5 customers) become 3x a week regulars: $3510 per yr.• Total new business value (after promo costs): $7,820 per year

ROI of POS Software


Better Business Analysis:• What menu items sell the most• What hours are unprofitable• What employees are most effective

Example: • You find that Cake Pops are outselling brownies 3 to 1. You decide to dump the brownies and add Chocolate Fudge Cake Pops instead. • Increased Sales = $8.85 per day = $61.95 per week = $3221.40 per year

Example: • For the past few weeks you realize that sales from 4-5 pm are not covering labor costs. You decide to close an hour earlier. • Labor Savings = $23 per day = $161 per week = $8372 per year

Example: • You decide to hold sales contest to see who can sell the most pastries. The staff gets excited about the competition and sales triple! You decide to implement a different contest each month.• Increased Pastry Sales = $30 per day = $210 per week = $10,920 per year

ROI of POS Software


Gain Time / Manage Remotely / Multiple Shops:• Quality time outside the business• “Eyes” at the shop when you aren’t there• Access remotely • Keep prices consistent across multiple shops• Export data to Quickbooks / Payroll / Accounting

Example: • After years of being tied to working daily at the shop, you go on vacation to Hawaii for a week. You log in daily to your POS system to check the #s.• Relaxation with the family: Priceless!

ROI of POS Software


POS Return on Investment Yearly Savings

Forgotten Upcharges $1638

Inappropriate Discounts $1638

Mistakes – communication to baristas $546

Items not run up $8190

Manager overtime for paperwork $3380

Extra labor hours when not busy $5382

Running out of profitable items $1260

Pre-paid card usage $9880

Mobile app boosts frequency $23,400

Loyalty program boosts return rates $27,000

Gift card promo brings in new customers $7820

Focus on most profitable items $3221

Eliminate unprofitable open hours $8372

Sales contests among staff $10,920

Grand Total: $112,647

Paradise Here We Come!

Choosing A POS System


• Bar code entry• Retail item sales• Not fast

Retail Systems Restaurant Systems• Touch screen• Food ordering• Little Retail

Coffee Shop Systems• Touch entry• Retail & Food• Specialty Coffee Features

What Makes Coffee Specialized


• Easy Drink Builder with sizes, flavors, upcharges, modifiers• Cup labels• Cup count inventory reports• Mixed retail (barcode) with food• Easy interface for whole bean sales• Customer pre-paid gift card accounts• Customer loyalty programs

POS Considerations


• Tablets are a hardware option• Popular for image , mobility, price• Software functionality is critical• Mobile Line buster or Fixed on counter? • May be limited in credit processor choice• Require enclosures / stands – increases costs

Tablet POS

POS Considerations


Cloud POS• Your data primarily resides off site, on POS co. server• PRO: Data is not lost during hardware failure• CON: Access can go down – either your internet fails or a cloud outage. • Consider: Do you have access to export/store data?• Subscription cost – ongoing – as long as you want to access the historical info.

Average yearly unavailability of cloud services (in hours)7.5 Average yearly unavailability of

electricity (in minutes)15

Source: http://statspotting.com/cloud-statistics-outages-cost-more-than-71-million-usds-since-2007/

http://statspotting.com/cloud-statistics-outages-cost-more-than-71-million-usds-since-2007/

http://statspotting.com/cloud-statistics-outages-cost-more-than-71-million-usds-since-2007/

POS Considerations


“Traditional” POS• Data & Software resides in your store• Typically uses Windows-type workstations• May have option to run on tablets• Many available peripherals• Full-featured systems

POS Considerations


POS-Enhancers• Online & Mobile Ordering• Credit Card Processing• Gift Cards & Pre-Paid Cards• E-mail & Text Marketing• Loyalty Rewards• Enterprise reporting• Enterprise System Management• Accounting & Payroll integrationConsumers surveyed have used

mobile internet to place a food order69%

Have downloaded at least one branded, individual restaurant app

50%

Consumers age 18-30 are “happy” to receive offers via SMS (text)

50%

Of text messages are opened; 83% within 1 hour 95%

Consumers estimate their visits increase once they join a restaurant loyalty program

35%

Say they recommend to friends more often if restaurant has a rewards program

65%

How Will You Pay for your POS?


• Cash• Credit Card• Lease• Subscription Plan• Credit card royalty Plan

TIPS: Selecting Your POS


• Identify key features for your business - checklist• Choose software first• Look for industry-focused solutions• Hardware is a commodity – purchase from 1 source• Look for expandable features for your growth• Look for PA-DSS Certification for your security• Consider recommended credit processing partners• Contact references• Consider company’s character – it’s a long term relationship!

TIPS: Negotiating Your Purchase


• Buy hardware & software from one vendor for the best deal• Want a deal? Focus on software “modules” that can be discounted more easily than hardware• Timing: Ask for the show special• Negotiate your credit card processing as part of your purchase.• Explore payment options – lease vs. buy vs. SAAS (rental/subscription)

TIPS: Getting The Most ROI


• Don’t skimp on training – be sure you learn how to use your new system.• Assign a staff member to become an expert• Go beyond the basics & use the tools:• Inventory• Scheduling• Marketing / Loyalty• Stay actively involved with your vendor.• Attend ongoing training / courses / seminars • Keep software updated & supported


Thank You!About Us:Coffee Shop Manager is a leading technology provider to the coffee industry. We offer point-of-sale with integrated online, mobile and self serve ordering, as well as a robust loyalty marketing solution. Please visit us in Booth #327.

View slides at: http://www.coffeeshopmanager/softwareROI

http://www.coffeeshopmanager/softwareROI

Coffee Shop Software ROI coffeefest 2014

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