6 most important KPIs for QSR businesses in 2023

6 most important KPIs for QSR businesses in 2023

As an owner of a multi-restaurant QSR business, it is important to keep track of key performance indicators (KPIs) to ensure the success and profitability of your business.

Here are six important KPIs to consider:

Gross Profit Margin (GPM)

Description: GPM is a financial metric that shows the profitability of your restaurant by indicating how much money you are making after taking into account the cost of goods sold (COGS). It is calculated by subtracting the COGS from the total revenue and then dividing the result by the total revenue. In 2023, with cost of products rising, GPM is crucial in maintaining profitability for multi-restaurant owners.

Formula: (Total Revenue - COGS) / Total Revenue

Example: McDonald's (global fast-food chain)

Labor Cost Percentage

Description: Labor Cost Percentage shows the percentage of total sales that goes towards paying your staff. With the shortage of staff in 2023, tracking this KPI is important to ensure that you are not overspending on labor costs. It is calculated by dividing the total labor cost by total sales.

Formula: Total Labor Cost / Total Sales

Example: Shake Shack (global burger chain)

Customer Satisfaction Score (CSAT)

Description: CSAT is a measure of how satisfied your customers are with your restaurant. In 2023, with increasing competition and rising customer expectations, tracking CSAT is important for multi-restaurant owners to maintain customer loyalty and repeat business. CSAT can be measured through surveys, reviews or feedback forms.

Formula: (Number of satisfied customers / Total number of customers) x 100

Example: Chipotle (global Mexican cuisine chain)

Table Turnover Rate

Description: Table Turnover Rate indicates how quickly you are able to serve customers and turn over tables in your restaurant. With labor shortages in 2023, this KPI can help owners optimize staff utilization and maximize revenue potential. It is calculated by dividing the number of tables served by the total seating capacity and multiplying the result by 100.

Formula: (Number of Tables Served / Total Seating Capacity) x 100

Example: Olive Garden (global Italian cuisine chain)

Average Order Value (AOV)

AOV measures the average amount spent by each customer per transaction. With the cost of products rising in 2023, increasing AOV can help owners maintain profitability. It is calculated by dividing the total revenue by the total number of orders.

Formula: Total Revenue / Total Number of Orders

Example: Pizza Hut (global pizza chain)

Sales per Square Foot

Description: Sales per Square Foot is a measure of how efficiently you are using your restaurant space to generate revenue. With rising real estate prices in 2023, tracking this KPI can help owners make informed decisions about their restaurant locations and layouts. It is calculated by dividing the total revenue by the total square footage of the restaurant.

Formula: Total Revenue / Total Square Footage

Example: Starbucks (global coffee chain)