He continues by saying “Perhaps it makes sense to count things where the counting tells us how to do better next time. And to count things that let us know how much risk we can take next time. But it makes no sense at all to count things over which we have no control, and which teach us nothing about the future.”
This article reminded me of a former client who ran his center out of his check book. If he had enough money in his checkbook by the end of May to get him through the summer with some left over, well, he was feeling happy.
Unfortunately, he didn’t count anything else. Oh yes, he did count his weekly payroll and annual inventory, but I really never found out what he did with those numbers or how he acted upon them. Here’s what he didn’t count for the week:
- Not lineage per lane
- Not average price per game by market segment
- Not revenue per game (all revenue, not just bowling revenue divided by the number of total paid games)
- Not revenue per square foot
- Not food or beverage sales per game
- Not number of stops
- Not parts inventory
- Not shoe rental to open play ratios
- Not payroll as a percentage of weekly sales
- Not food costs as a percentage of weekly sales
- No arcade cost of sales
- Plus a few others…
No doubt there are other metrics that many of you use, but my question has always been, how do you act upon it? If you only get a monthly P&L; by the time you can act on your (I.e.) food cost, you’re already 4 to 6 weeks behind fixing it.
Therefore, I suggest that if you aren’t already doing it, please generate a weekly “flash report” with the above-mentioned metrics… compared to last year same week.
There is a normal range where each of these should be trading. You may be on the higher end of the spectrum or the lower end of the spectrum. For example, if your food costs are running 40% or higher, your center is on the higher end of the spectrum and you have a problem or three problems
- Your prices may be too low, especially with the acceleration of costs in the last six months. Have you adjusted your prices or increased the price of your food and bowling specials?
- You may have a partner who is not ringing up cash sales. Hope not!
- Your food may be going out the back door with one of your employees. Hope not!
I mention all these things because looking at a dozen metrics and knowing what they mean can sometimes increase your bottom line 10% to 30% or more and I have seen it happen.
So, measure what’s important and what you can control and then take action to fix it.
You might just feel more of it in your checkbook.