Business and Operations
Point of Sale (POS)
Simple Changes, Major Results
By Alan Zelcovitch
Introducing online ordering can replace time- wasting phone calls and improve your overall efficiency.
By Alan Zelcovitch
I would like to introduce to you a little example of how some technology can effect major changes to even the simplest of operations.
For this example, let’s look at a small single-store bakery running a front counter that sells breads, rolls and pastry with a small catering operation of sandwiches and salads in the back.
The bakery employs two people to service walk-in customers, and their main jobs are to serve clients at the counter for their immediate needs and take orders for baked goods and lunches over the phone.
During a typical day, Vanessa (employee one) spends her entire shift dealing with the line of people waiting for service. No sooner does she serve and cash out a customer before the next one in line is ready. Vanessa does not answer the phone at all.
Jonathan (employee two) spends three-quarters of his shift on the phone taking orders for corporate lunches, and when he is not on the phone he is helping Vanessa.
For this example, let’s assume that Jonathan’s calls for corporate lunches last about 10 minutes each, and when they are done he has a nice sheet of hand-written paper with a lunch order.
He also receives calls from clients that want to pick up bakery orders without having to wait. Those calls take an average of 15 minutes because clients love to talk, cannot make up their minds and need to be spoon-fed the whole way through.
During an eight-hour shift Jonathan will take about 30 orders, and in turn he will hand the bakery 30 sheets of paper with a variety of orders. He also gets paid about $100 for that shift. So here’s the math: 30 orders for $100.
Now let’s not forget that the kitchen has to decipher those 30 orders. George, who works in the kitchen, walks to his desk and separates the bakery orders from the catering orders.
Once that is done he further separates the different products that need to be baked for the pickup orders (for example: 16 croissants, 20 muffins, three pieces of carrot cake etc.). And he also has to create the catering order (28 tuna sandwiches, 33 salmon sandwiches, 14 egg salad, 22 servings of tossed salad, 21 servings of pasta salad etc.).
After he separates those quantities, he has to figure out what ingredients are required and make sure the stock is there. So for the purposes of this example, let’s assume George, as fast as he is, spends an hour at his desk. George is paid $18 for that hour of time.
So now we have two labour cost figures, $100 plus $18 dollars for one day. Now to be fair, Jonathan doesn’t spend his entire day on the phone, so let’s say that it’s three-quarters of a day, so the real cost is about $100 combined for the two of them, per day.
To put it clearly, that is $2,000 per month plus source deductions being used for repetitive labor.
Now let’s introduce a little, and I mean little, computerization.
The owners of this bakery decide that this is a big waste of money, so they invest in an online ordering system for the catering and the bakery pick up.
The system creates orders and gives the kitchen a list of foods required as well. The second an online customer places an order the kitchen has it. It’s an order, and an invoice has been created (oh yes, that takes time too). The ingredients are calculated and, guess what, the client did it all online. Jonathan and George used none of their time to do this.
Clients order lunches online at their desks. Customers order products from their home computers. They do not call in and waste employee time.
Multiply this by the number of transactions a day, and suddenly you’re saving $2,000 a month. Now the owners have some options: they can reduce hours, terminate one person or whatever they choose. The simple fact is they have extra money.
The cost for this extra money is to pay for the computer programming, which can be paid for with just a few months worth of savings.
This example only illustrates a small component of a company’s operations. If this were to be expanded, it would end up saving much more money.
The key here is to recognize that when you have a pen, and it repeats what it is doing, it can likely be programmed and computerized.
An efficient operation should never use a pen or paper. If your company relies on ink and paper you’re doing repetitive tasks, and technology can correct that.
Some may be concerned that by removing phone calls your company’s personal touch with the consumer is lost, but I would argue that while you may lose some of that touch, these days people do not want to talk to people, they would rather order online.
In fact, for many people, if they can’t order online they will find somewhere where else where they can. You may lose a few clients, but you really should not because you still have your phone, and they can still call. This is a serious win-win situation.
Having an online presence also makes your business more marketable. When someone asks for a menu, just e-mail it. And once your business becomes digital, so to speak, you can take advantage of many new ways to market yourself. You could have a blog, a Facebook page, an Instagram account, and so on. Take the leap, and move your business to the next level.
Alan Zelcovitch owns Cookie Delivery.ca (an online bakery business) and CSN Canada (a computer technical support company). He has had both for 13 years. Alan is an expert in technology and how it relates to the food business. He offers a wide range of consulting services, with an emphasis on the food industry. He can be reached at 416.488.3886 or firstname.lastname@example.org.