The Impact of Upselling to Your Restaurant
Updated: Jun 21
If the servers in your restaurant think that upselling is just a simple task you give them, then let them think again!
Let them understand the impact of upselling.
Upselling is a sales strategy wherein a seller encourages the customer to purchase or add more items to boost your profit.
This sales technique is commonly used in the restaurant business.
But some industries like airlines, telcos, electronics, hospitality, etc. have also been using this for quite some time now because of the tremendous impact it creates in generating more sales.
There are only 3 ways to grow our restaurant sales:
1. Get new customers
2. Increase our repeat business
3. Increase the average ticket
Let's focus on increasing the average ticket because that's where we can apply upselling.
Do you know what your average ticket is? How about the average ticket breakdown between breakfast, lunch, and dinner?
For instance, in our pizzeria's delivery orders, at lunch, it is $16-$17 per ticket. At dinner, it goes up to $25 per ticket because deliveries tend to be bigger since we have two pizzerias.
For dining options, we might have a lower ticket average because a customer might eat what he ordered at once, or he might go back and get another beer, or he might get upsold a dessert.
So that's a separate ticket that brings our average down, but we got more tickets.
We analyze these data by looking at our average ticket per dining option and compare them. We got phone orders delivery vs. online delivery. It's a fact that our online take-out is better because it is $5 more per ticket.
The average ticket is not about getting new customers, which you can do through advertising, Facebook ads, etc.
One thing that is certain when it comes to a new customer is that nobody needs another pizzeria or another Mexican place, they are already taken.
Their needs are met, and we're trying to convince them to come to our restaurant. It's a lot of work.
Increasing repeat business, on the other hand, goes back to making sure that you're doing your email and text messaging marketing weekly to keep your customers coming back to your restaurant.
Moreover, increasing the average ticket does not have to do with anything of that because you already have customers doing business with you.
And being strategic in making sure that your team fully understands the impact of increasing your daily average ticket can make a lot of difference.
One thing that affects your average ticket is obviously your prices, and you must be increasing your prices every six months.
When you raise your prices, you need to update your POS system. If you have a print menu, you have to redesign and print it again.
If you have a menu board, you have to update it, you need to inform every single employee you have. It is a hard-work.
Upselling is actually one of the easiest ways to grow your profit however you have to make sure that it is being done without any hesitations by all your servers.
So why should you tell each of your staff to upsell every time there's an opportunity and be keen on it?
Let's do a sample Math computation:
$20 average ticket
$20 x 1000 = $20,000/ week
$21 x 1000 = $21,000/week (when you do upsell)
$1 more per ticket means $1000 more per week
$1000 x 52 = $52,000/year
A restaurant has 1000 tickets per week, and they have a $20 ticket average which means that they are currently making about $20,000 a week.
Now if only change that $20 per ticket average up to $21, then, $20,000 x $1,000 is equals to $21,000 a week.
So by just simply adding upselling to what you've been doing, what your servers are doing or what your website is doing, you can get it to a thousand dollars more per week.
It seems like $1,000 a week is no big deal. The next multiplication is what makes it fun.
If you consider 52 weeks in a year, that $1,000 x 52 that turns it to $52,000 a year. See how that $1,000 weekly can make a big difference to your sales? That's a down payment for a new house or the price of a brand new car.
We need to make sure that our servers do the Math for them to realize that upselling should never be taken for granted.
You must be obsessed with upselling. If not, you are losing $52,000 a year, that is the opportunity you are missing out on. In two years, that's $104,000 you're losing.
So your challenge now is to have your servers do the Math and calculate.
Get the number of ticket average that you process per week, what is your average ticket per day, and then calculate how much you can earn in a year if you only do upsell wholeheartedly.
Have them do the Math to fully understand the impact of upselling. Let them be enlightened about the impact of $1 per ticket that makes a $52,000 per year profit.
And if you want to convert it to the amount of servers' tip, which is 20%, that is around $10,400, that should be going to their pockets. That's how much you lose for not following a good upselling script.
By this time we hope that you see how a simple phrase like, "Would you like to add ice cream in your order for your dessert?" can make a big impact on your sales.
So go ahead and have that meeting set with your staff now. Teach them how to upsell consistently and wait for your sales to go up!
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