Running restaurants with speedier drive-thrus that get better ratings from consumers ultimately generate better results.
This is obvious to any industry executive, at least any decent industry executive. But it’s particularly important these days as brands search high and low for that elusive restaurant traffic.
Companies are better off when they ensure their restaurants are run well from the get-go.
For this, we go to an unlikely source: Hardee’s, the chain being sued by one of its largest franchisees over a termination effort because said franchisee refuses to accept digital orders or stay open past 2 p.m. That’s the same Hardee’s that generates among the lowest average unit volumes in its competitive set.
But its franchise disclosure document is an effective argument in favor of better operations. It includes data comparing restaurants by unit volumes and their respective drive-thru times during all dayparts, their average ratings on Google and their net sentiment scores—meaning the difference between positive and negative comments.
Here are the numbers:
The top-grossing restaurants have faster drive-thrus that operate six seconds faster than average, and 17 seconds faster on average than the bottom-third restaurants—even though they generate twice the unit volumes and are therefore busier.
That faster drive-thru is also evident all day long. Hardee’s data shows that the top restaurants are faster in the drive-thru at breakfast, lunch and dinner. And that gap widens as the day goes on.
At lunch, for instance, the top-grossing restaurants are 11 seconds faster than average. At dinner they are 17 seconds faster.
Hardee’s is busiest in the morning and, as we wrote about earlier this week, some operators focus the most on that daypart. But the data show that the higher-revenue restaurants run better during the rest of the day.
And those restaurants generate higher service scores.
The top-grossing restaurants have average Google ratings that are 3.2% better than average, and 6.2% better than the bottom third.
Maybe more instructive are the sentiment scores for the highest grossing restaurants, which are 21% higher than average and 51% higher than the bottom third.
All this has led to sales growth. The highest-grossing restaurants on average grew revenue by 5.3% last year. The system average was a 3.4% increase. The lowest-grossing restaurants grew sales by just 0.3%.
To be sure, there is a question of causality. A higher-grossing restaurant gets more customers, and the teams get more practice dealing with busier periods, which means they’re simply better prepared to deal with whatever comes during the course of the day.
But they also have the finances to invest in people and technology that can further improve operations.
Lower-grossing restaurants, on the other hand, may feel forced to cut costs that hurts operations and therefore makes it more difficult for them to provide speedier service in the drive-thru or serve customers the way they want to be served.
In the Paradigm lawsuit, the franchisee highlighted the sales increase that followed its decision to cut hours and devote more resources to the morning hours. In short, by improving service, the operator generated sales growth.
Franchisees can therefore help themselves with improved training and investments in people. But it also helps when brands are performing well enough that operators can generate the sales that can enable them to make these investments.