Restaurant and bar technology. On one hand, the age-old tradition of gathering together and sharing refreshments. On the other, computers shooting information at each other. Will they ever get along?
Yes! Technology is now a necessary part of providing the experience guests expect at bars and restaurants. Over 80% of restaurants embrace it, and 53% say they would even implement predictive ordering technology. Restaurant and bar technology is here.
So what is the technology used in a restaurant? In this guide, we’ll cover two primary tools that will help your business deliver memorable service and make more money. It doesn't matter if you're managing a bar, restaurant, or hotel. First we'll look at Point of Sale (POS) systems, then get into restaurant management software.
What is a POS System?
POS stands for point-of-sale. It refers to the physical place where the sales transaction takes place. There are two components of a restaurant and bar POS system:
- POS hardware is the physical screen, tablet, or kiosk where staff enters the order. It may also include printers, scanners, and cash drawers.
- POS software is the program that runs on the hardware. At its most basic, it’s a purely transactional software that rings up and prints items sold. At its most complex, it’s an all-in-one reporting and analytics suite that helps you manage most aspects of your business.
POS software is the program that runs on the hardware. It’s basically a purely transactional software that rings up and prints items sold. At its most complex, it’s an all-in-one reporting and analytics suite that helps you manage a bar.
POS systems help different parts of your restaurant and bar communicate with each other. They are the brains behind the operation. So let's take a look at the different types of POS systems, how much they cost, and some of the low-cost solutions out there.
Types of POS Systems
The first POS system was created by IBM in 1973 for McDonald’s. Here are some things that didn’t exist in 1973:
- Chicken McNuggets
- Artificial hearts
- DNA fingerprinting
- The Space Shuttle
- The freaking Internet
What a world. It’s no wonder that POS systems have evolved substantially, and there are now a few different types: legacy, cloud-based, hybrid, and mobile.
Legacy POS Systems
Legacy POS systems are the old-school ones. The software used installs locally and the restaurant or bar owns it. Imagine a computer that’s not connected to the internet. You can access files on it, but those files are on your computer. Similarly, all the information in the legacy POS system is stored locally on a hard drive. They’re generally slower, require on-site visits from reps to troubleshoot technical problems, and need to be restarted anytime you want to update your system.
Cloud-Based POS Systems
Cloud-based POS systems are the new ones. Now imagine a computer that connects to the Internet. You can access files on it, but those files are on another hard drive (a server) somewhere else. All the information in your POS, from menu items to payment information, is stored in the cloud. That's a fancy way to say the data is not on your local hard drive. That also means its accessible from anywhere, in contrast to legacy systems. It also means that updating is a breeze because the servers refresh automatically. It also makes troubleshooting easier because your POS provider can help you remotely. Don’t worry about the internet going down, either. Cloud-based POS systems still maintain most functionality in offline mode.
Hybrid POS Systems
Hybrid POS systems integrate aspects of legacy and cloud-based systems. All the system’s data is stored locally, like legacy models, but all that data also syncs to the cloud. The primary benefit here is that you lose no functionality whatsoever if the internet goes down. The drawbacks are similar to using a legacy POS. You need to invest in a local server and updates to the system are not in real time.
Mobile POS Systems
Mobile POS systems are cloud-based, but further characterized by the inputs being via phone, tablet, and other mobile devices. You’ve probably encountered a mobile POS system in the retail environment. Like when your purchase is wrung up via a credit card swiper plugged into a smartphone. In bar and restaurant technology, the applications of a mobile POS system is primarily anytime there isn’t a permanent physical location. Think of food trucks, concerts, and street fests, along with tableside ordering, catering, and contactless payments.
They’re exceptional tools for running a business, but they can cost a pretty penny.
How Much Does a POS System Cost?
A POS system is one of the most important investments in your bar or restaurant. It’s typically one of the more expensive pieces of restaurant and bar technology needed.
Legacy models have upfront costs of anywhere from $5,000 to $50,000. Cloud-based models usually charge between $50 and $500 monthly for a subscription to use their software.
If you’re opening a bar from scratch, the best bet today is getting a cloud-based system on a monthly contract. It doesn’t require the upfront cost or your owning of a depreciating asset. And the vendors usually provide free lifetime software and security updates.
Types of Bar and Restaurant Management Software
There are hundreds of companies that exist only to provide their bar and restaurant software to you. Nowadays they're pretty much all cloud-based, and their business model is “Software as a Service” or SaaS. It’s now the go-to way to turn the bunches of data that your business generates into action items.
When you’re shopping around for a POS system, keep in mind the different types of restaurant technology and bar management software out there. Some POS systems include a lot of that functionality already.
And if they don’t, then you’ll need to procure that software on your own. You’ll need to consider software for restaurant and bar inventory, purchase and invoicing, accounting, reservation, digital menu creation and maintenance, and scheduling.
Restaurant and Bar Inventory Software
Bar management software is likely the most impactful bar and restaurant technology you can find. It not only helps you do the actual counting, but it takes all that data and spits out super valuable metrics. Then you can use those metrics to help control food and liquor costs and boost profit. These are the primary benefits:
As any bar manager or beverage director knows, bar inventory management is the beating heart of a well-run, profitable bar. But without inventory management software, it is exactly that: counting. Manual counting. Error-prone counting. Restaurant and bar inventory management software streamlines that completely. Typically using a scanner like BinWise Pro does. Instead of combing through your stock and marking every individual item down manually, you point and scan. The software updates the inventory levels automatically.
Having a perpetually accurate inventory is another huge benefit of using inventory management software. As you take inventory, your current inventory levels automatically reflect the reality in your storage areas and behind your bar. This gives you a great idea how much alcohol you’re using, which you can then compare to how much alcohol you’re selling. That’ll be your bar’s variance.
A huge area of opportunity for restaurants and bars is accurately calculating variance (also known as shrinkage and loss) and lowering it. Bar inventory management software has up-to-date inventory. That means it can calculate usage rates, compare that with total sales, and provide variance numbers at a moment’s notice. Variance for different revenue centers, product types, product brands, and more. Using bar inventory software, the ability to drill down into your liquor loss is unmatched.
Par Level Reporting
Using inventory management software helps you easily set par level. That's the ideal amount of product to keep in stock to avoid running out or having too much cash tied up in sitting inventory.
Before committing to an inventory management software, ask these questions:
- Can smartphones and mobile devices be used as scanners when counting?
- How granular does the variance reporting get? Does it drill down into the variance of separate revenue centers?
- What waste-tracking tools are available to help you reduce over-pouring, over-ordering, and theft?
Purchasing and Invoicing Software
SaaS companies in the food and bar technology space can also streamline bar and restaurant purchasing. Usually that's through individual reps at individual vendors and results in an ever-growing pile of individual invoices. The two primary benefits are:
- The ability to purchase quickly online through one platform from all of your vendors, while still maintaining direct vendor rep communication.
- Receiving one digital invoice per order that’s saved and tracked in the platform. You don't have to make sense out of a bunch of separate invoices. You can also access historical product and purchase price data for smarter future purchasing.
Before committing to a purchasing and ordering software, ask these questions:
- Can direct vendor rep be maintained even if that rep isn’t using the same purchasing or ordering software?
- What analytical tools are available to make use of the historical product and purchase price data?
Cloud-based restaurant accounting software will handle everything related to dollar signs. Up to and including making sure you’re running a profitable bar or restaurant. Some features in great bar and restaurant accounting software are:
- Location-specific accounting that collects your overall ledger, all accounts payable and receivable, bank and creditor reconciliations, forecasts, and budgets in one central dashboard
- Communication with your inventory and operations costs to quickly create budgets for any time frame and any location
- Integration with many top payroll providers and POS systems to combine all your internal labor data for review and reporting
Before committing to an accounting software, ask these questions:
- Exactly what payroll providers and POS systems does the software integrate with?
- Does the software have daily profit and loss reporting?
The expectation among guests is that there is some way to book a table at your restaurant online. Assuming you accept reservations. Customers scan a custom QR code or hop online, head to your or the software company’s website, and input their reservation time and size. Then that information shows up in the computer at your host or hostess stand. It's shown over a diagram of your dining room.
In total, restaurant reservation software gives you:
- Access to all the potential diners out there who aren’t so keen on making phone calls.
- An accurate, real-time look into your expected traffic for the evening, so you can assign stations and staff accordingly.
- The ability to seat and turn guests quickly with updated table statuses, so no recently-deserted table is left unbussed and unsat for long.
- Server and station statistics to make sure everyone is being sat equitably, nobody is too weeded out, and service and seatings run with ease
- A place to keep information and notes on guests for any special accommodations needed
You pretty much can’t miss with a platform like this. Before committing to a restaurant reservation software, ask these questions:
- Does the platform allow future diners to prepay? Some do.
- Is there a fee per reservation made through the platform’s website? Some platforms have their own customer-facing presence and allow customers to book outside of your website, and they charge a fee for it.
- Is the platform web-based? Believe it or not, some reservation software isn't downloaded, you just log in and start using it.
- Is it...free? Seems silly, but some are free. They offer paid add-on features, but basic functionality is free.
Digital Menu Technology
In accordance with our new normal, paper menus are on their way out. There are a few different kinds of digital menu technologies that can take their place: menu apps and QR code menus.
App, short for application, is a piece of downloadable software that performs a specific task. When downloaded for desktop computer use, they’re called desktop apps. When downloaded for mobile use, they’re called mobile apps.
Today’s menu apps are, by and large, mobile apps. A menu app, then, is a piece of software that is downloaded on mobile devices to allow you to view a restaurant’s menu.
The Pros of Using a Menu App
A Rich, Detailed Menu Experience
Menu apps allow bars and restaurants to surface a lot of relevant and eye-catching content about menu items. Because it’s a piece of software, menu items can exist on their own page. Guests click into a menu item and can see nutritional information, high-definition images, wine pairing suggestions, and more.
All that context drives a lot of experiential value. It should be said, though, that the same can be done with a web page. But a native app may do so with a crisper user experience.
Menu apps are easy to navigate and typically searchable. It’s not necessary to browse the entire menu. A menu app has foods categorized and guests can hop to and drill down into their desired categories. Again, a web page can do this, too, but a big-budget mobile app may provide a slightly better experience.
A Line of Communication
Once a guest has downloaded your menu app, you can send them push notifications for virtually anything. New menu items, promotions, changes to operating hours, and more. A downloaded app is an open line of communication with guests, which is a huge opportunity for marketing.
But those benefits come with a cost.
The Cons of Using a Menu App
While the allure of cutting out paper and printing costs is strong, a menu app brings its own set of expenses. Creating an app is not like creating a website. It’s a standalone piece of software coded from the ground up. That means you need to hire developers to build and maintain it.
Native apps have an upfront cost anywhere from $10,000 to $100,000 depending on the amount of resources you’re willing to devote. If you’re interested in creating an app that blows away the user experience and speed of websites, you’ll be on the higher end of that cost estimate.
They’re Not as Agile as People Think
Sure, a menu app can act as a content management system in the sense that it stores and displays content. And that content can change relatively easily. But the app itself, the tool that stores and displays the content, cannot change quickly.
Maintaining an app can be a full-time job. Fixing bugs, deploying updates, enhancing the user experience, and creating new features are all substantial undertakings. So a fully-functional app’s menu items update with relative ease. But getting that app to be fully-functional requires a huge investment of time and effort.
A menu app is a good idea, in theory, for a business. But think about it from a customer perspective. The average smartphone user has over 30 apps on their phone. And they go to a heck of a lot more restaurants or bars than just one.
Having to download, manage, and find multiple menu apps on your phone is a headache. There are so many apps out there, that your app risks getting lost in the shuffle. Apps used to be a novel, convenient solution, but they’ve proliferated to such a degree that they’re almost clutter now. Expensive, time-intensive clutter at that.
They Don’t Promote Discoverability
If a bar or restaurant menu is a mobile app, it’s not published on the web. That means it doesn’t show up in Google. That means the menu you put so much time and effort into creating, tweaking, and perfecting is not discoverable by new customers.
There is another option, though. And that’s using QR codes.
QR Code Digital Restaurant Menu
If you use a QR code for a restaurant menu, for one, it's far cleaner than its paper counterparts. And learning how to scan a QR code and how to avoid QR code scanning problems is simple. They're a delightfully easy piece of technology.
The Pros of QR Code Digital Restaurant Menus
They’re the Most Cost-Effective Restaurant Menu Option
Like menu apps, they eliminate the costs of paper and printing. Those costs may not seem substantial based on past experience, but it’s a different world. The National Restaurant Association recommends replacing paper menus after each single use. If you observe those guidelines—which you absolutely should—then the costs of single use menus adds up massively.
For the average restaurant serving 100 customers a day, 6 days a week, menu printing costs can range from $440-$480. A QR code menu by comparison will cost between $85-$125 per month. The more customers you serve, the higher your savings because QR code menus have a fixed monthly cost.
Couple that with the fact that a QR code is not an application. You do not have to pay for developers to code it from the ground up. It is, hands down, the cheapest digital restaurant menu option out there.
They Don’t Require Constant Maintenance
Creating a QR code is as simple as clicking a button. Creating a QR code digital restaurant menu is as simple as uploading a spreadsheet of your menu items and clicking a button. It’s some of the simplest restaurant technology out there. There is no codebase to troubleshoot, prune, maintain, and optimize.
There are so few moving parts, you’re likely never to have a problem using a custom QR code for your digital restaurant menu. They allow you to update your menu items almost instantly. That means you can test out pricing strategies and menu placement to drive sales. Look into menu engineering if you're not familiar, it's great stuff. And QR menus slot right in with a menu engineered for maximum profit. Without having to pay—in time and money—by constantly answering to a finicky standalone app that needs constant technical oversight.
They’re Lightweight, Accessible, and Convenient
There is nothing to download when accessing a digital restaurant menu through a QR code. Here's how a QR code works. A customer simply scans the code and the menu, already published online, pops up on their device. Doesn’t matter what device, as long as it is connected to the internet and has a web browser.
They don’t have to roll their eyes and download yet another app. You are not asking them to dedicate space on their device for your software. There’s nothing to find and update. They just point their device at the QR code—which can be placed anywhere—and scan it. It takes a second. Here are some good QR code templates to help them do it, too.
They’re Easier to Use
Look into how to scan a QR code. It’s as simple as pointing your phone at the code. Anyone who can take a picture using an iPhone can scan a QR code. This is in contrast to menu apps’ requirement to be downloaded and updated. For the non-tech-savvy among us, that’s actually a lot to ask. Pointing your phone at something is not. And if there's ever an issue with scanning, it's easy to troubleshoot QR code scanning problems and check if a QR code works.
The Cons of QR Code Digital Restaurant Menus
No Push Notifications to Customers
But that may actually be a good thing. Most people experience information overload, anyway. The average person gets over 75 emails per day. And they open less than 30% of them. People have a similar level of engagement with push notifications. That said, if you do want to send push notifications, a native menu app is one way to do it. But QR codes are no slouches, either. Look into QR code marketing.
Lower User Experience Ceiling
A QR code digital restaurant menu brings you to a website. A website is usually just as interactive as a mobile app. That said, many times mobile apps—with the right amount of investment—can provide a richer user experience than a website. If your goal is to provide a world-class interactive menu experience, then a team of developers, a big investment of time and money, and a native menu app is your best bet. Though, keep in mind, the more time your guests spend engaging with your technology, the less time they spend order, eating, and drinking.
The Risk of Free QR Code Generator PDF Sites
Lots of people hop online and use a free QR code generator site. These work fine if you're after a simple static QR code. But using a dynamic QR code that your business relies on is a different story. Some free sites like this use the opportunity for QR code phishing, malware, and other security issues. You also run the risk of broken codes when the business inevitably goes under. If you're a serious business, find a serious technology partner to create your QR codes. It's well worth it.
If you do choose to create a QR code PDF, you should pay special attention to PDF accessibility, too.
Menu Apps vs. QR Code Digital Restaurant Menus
Here's a slick little chart we put together so you can visualize the pros and cons between menu apps and QR digital restaurant menus at a glance.
So, before committing to digital touchless menu software, ask these questions:
- Is it self-service? If it's not, you'll lose a lot of the agility that makes it so great
- Does it offer a QR code so you can provide a truly contactless menu experience?
- Does it come with a pre-optimized template so all you have to do is drag-and-drop a spreadsheet of your menu information into it?
Also keep in mind that digital menu software applies to all types of menu. Anything can be presented digitally through a QR code. Read more about QR code uses. They can be leveraged for touchless ordering, contactless payments, QR code marketing, and more.
Creating a bar or restaurant schedule can feel like the final moments of losing a Tetris game. There aren’t many industries that require multiple shifts throughout the day with multiple people coming and going at different times. One of my previous managers at a restaurant had trouble with this. He'd wiggle his hands above his head and yell “I gotta make the schedule!” as he was running off into his office to make the schedule. He didn’t come out for hours.
Don’t be like that guy. Use scheduling software. Here’s why it’s so great:
- AI auto-schedules everything, removing the physical act of filling in each shift on each day. A computer does it in a single moment. Presto!
- Labor forecasts take into account foot traffic, seasonality, and events to reduce needless wage costs and overstaffing.
- Flexible scheduling with real-time updates, making on-the-fly shift swaps simple and absences easily covered
Before committing to a restaurant reservation software, ask these questions:
- Can employees use their smartphones or mobile devices to access the master schedule?
- Can staff set automatic availability preferences?
- Will employees be automatically notified about schedule changes or request approvals and denials?
Embrace Bar and Restaurant Technology
Technology in restaurants is a good thing. Just look at how monumental the benefits of an interactive wine app is, or any other of the various menus that can be made digital. Whether you're a wine specialist or a barback, learning everything you can about restaurant and bar technology will ensure you end up with tools and solutions that fit perfectly with work style, business model, or management style. In your search for bar and liquor inventory software, it's worth considering BinWise Pro.
It integrates with POS systems and streamlines taking and analyzing your beverage inventory. You'll be making smarter ordering and pricing decisions from the outset. To say nothing of the many hours of taking inventory it'll save you.
Read about the product, then schedule a demo if you think it can help. It usually can, and a demo’s free, so why not?