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alligatortekWinner in: 2016
Roughly 60 percent of new restaurants fail within the first year, and nearly 80 percent close before their fifth year in business. Restaurant managers shop around for the best value in a distributor to grow their operation. It comes as no surprise that those businesses that distribute food to these small businesses have their work cut out for them to help restaurants be profitable.
US Foods, a leading foodservice distributor, faced this challenge around how to create sticky customers. If the company could find a means to drive profitability for the restauranteur, they could improve customer churn within their organization.
The Menu Profit ProTM, developed by alligatortek in collaboration with US Foods, enables restaurant managers to determine menu revenue and most importantly, menu profitability. Customers can quickly calculate the cost and margins for each item on the menu. As a result, restaurant managers can use the data to make better costing and menu engineering decisions. The success of the system has been its ability to make restaurants more profitable, producing a significantly stronger customer retention rate for alligatortek’s client.
“The magic lies in the system’s ability to calculate a menu item’s cost-effectiveness,” says Sid Bala, President & CEO of alligatortek. “The web-based tool ties into customer-specific pricing and integrates with their catalog of items. Other competitive software solutions have not been able to achieve this.”
Buyer retention has increased dramatically for customers that use the system compared with those customers that do not. US Foods has shown increased purchase levels, and the cost to serve them is much less expensive than finding and acquiring new buyers. Once restaurant managers adapt to the program, they view US Foods as more of a business partner and less as a replaceable vendor.
“Winning the Chicago Innovation Award is an honor. It is a great validation for our team to be recognized for the work that our company does,” Mr. Bala says.