Total Sales or Average Check?
These are the most difficult values to manage. We often hear happy comments from managers that the average check has increased lately, and sales have increased accordingly. But this is not always a reason for rejoicing. Rather, it is necessary to understand why this happened.
First, the average check may rise due to higher prices. Almost always, even with an overall increase in revenue, a rise in prices provokes a decline in transactions. Thus, by raising sales a little, we can lose precious customers and hence, their associated returns. Consequently, after a while, revenue decline is likely to follow. However, that doesn’t mean it’s impossible to raise your prices — in fact, it’s necessary to do this within the framework of inflation and an increase in purchase prices for your ingredients. But in every segment of the restaurant business, there is a certain guest sensitivity to price increases. For example, in the segment of fast food or coffee shops, a price in- crease of 2-3% will be noticeable by guests, in casual dining 3-5% is almost the limit, while in high-end restaurants a price increase of 10-15% may go unnoticed.