Major industries like travel and retail have been positively impacted by the adoption of new technology and data collection. Allowing for dynamic pricing and customer segmentation, big data provides a wealth of benefits, but the restaurant and bar industry has been slow to adopt change and embrace the inevitability of new technology standards.

There is significant opportunity to apply advances in technology to streamline operations and, more importantly, reduce waste. With a single restaurant contributing 25,000-75,000 pounds of food waste per year, it is an operational issue that has climbed the ranks with restaurant owners. From the Internet of Things to Big Data, the next few years will bring monumental shifts to the industry that will help reduce both the cost of goods sold and waste.

'Point of table'

Restaurants are exploring what a customer’s experience is like when seated at the table, replacing a traditional server with a smart device. These devices allow customers to order, play games while they wait and pay for their meal if there is a credit card reader.

How do smart devices help reduce waste? First, by removing human error. Servers are apt to not record or hear an order correctly, leading to food being not cooked the desired way, wrong sides coming out, or diet soda instead of regular. The accuracy of tablets ensures less food and beverage waste, with customers entering exactly what they want, how they want it.

Second, the data collected on the smart device allows for insight into the most popular menu items, even by season and time of day. This data is recorded in very precise ways, providing actionable information. By looking into what is selling and when (and when not), you can optimize your vendor and supplier orders based on the data, not on guesswork, thus reducing the quantity of expired food waste. 

Drafts’ deficiency

If you purchased 100 filet mignon cuts, you wouldn’t dream of throwing 15 of them into the garbage before they hit the grill, so why is it acceptable to waste the same amount of draft beer, one of your highest-margin menu items? On average, kegs go back to the wholesaler with 15 percent to 20 percent of the product still inside. That’s beer that was paid for but never sold. This is due to many bar managers still “kicking the keg” to determine how much is left and manually writing down inventory.

With developments in inventory management and Internet of Things technologies that can track near real-time consumption data on each keg, retailers of draft beer can know exactly how much is left in each keg, receive actionable insights on which varieties to order and which styles are selling given the time of year.

Beer should be treated with same care as other menu items and dynamically priced, yet many restaurants still ring up “draft beer” for every pint—with no tracking of which brand or style. If you were to walk into any big-box retailer like Target, each product, its size, price and how it is organized is the byproduct of intensive planning. There is no guessing. Yet for a tap lineup there is no corresponding discipline. 

Dumpster data

Adopting technology to reduce waste is a step in the right direction, but knowing if those actions are making an actual impact is the end goal. New web and mobile applications are surfacing that provide the tools necessary to take inventory of your waste, allowing you to input how much and what precisely you are throwing away, and calculating how that translates into lost revenue. You can use the data to track your progress over time and receive suggestions on how to continue reduction based on the type of waste you are contributing. These apps can also provide tips on how to engage your staff in the waste reduction process, and even connect you with local charities in need of food that day.

As the era of Big Data is upon us, the restaurant industry will see major changes to daily operations as new technologies continue to enter the market. We must embrace that this way of doing business is “new normal,” offering us granular data on how we should be stocking our shelves and serving our customers.

Steve Hershberger is the cofounder and c.e.o. of SteadyServ Technologies, a data-as-a-service company that delivers real-time performance intelligence on draft beer consumption and inventory.