Article How to Conduct an Accurate Restaurant Sales Forecast Restaurant sales forecasting helps you control inventory, staff wisely, and predict profits. Learn more about how to conduct a restaurant sales forecast. Restaurant sales forecasting has the potential to influence every major decision in your restaurant. A restaurant sales forecast enables you to know when’s the best time to open a new location, what inventory to order for the next month, and how many employees should be scheduled for a shift in two weeks.In this post, we'll go into detail about how to conduct a restaurant sales forecast, and why it’s so important to do so. Resource The Guide to Restaurant Sales In this guide, you'll learn specific ways you can effectively boost restaurant sales and how to measure the success of your initiatives. RESOURCE More orders, more profit – a guide to understanding your restaurant sales You must have Javascript enabled in order to submit forms on our website. If you'd like to contact Toast please call us at:(857) 301-6002 First and last name* First and last name* is required Email* Email* is required Phone number* Phone number* is required Restaurant Name Restaurant Name is required What is your role? Owner Wait Staff General Manager Chef Consultant Operations/IT Other Supplier Technology Partner What is your role? What is your role? is required What best describes your restaurant type? Fine Dining Full Service Casual Casual Dining Cafe / Bakery Fast Casual Fast Food / Drivethrough Food Truck Bar Nightclub Brewery Pizzeria Hotel Restaurants Ghost Kitchen Concessions and Stadiums Other What best describes your restaurant type? What best describes your restaurant type? is required Zip Code Zip Code is required By requesting a demo, you agree to receive automated text messages from Toast. We’ll handle your info according to our privacy statement. Additional information for California residents available here. Restaurant Sales Forecast Steps and MethodCalculate your restaurant's daily capacityUse sales data to conduct sales forecastsConduct inventory projections based on sales forecastsFactor in seasonal success throughout the yearStaff your restaurant according to sales projectionsFinalize your revenue and cost model for profit expectations How to Conduct a Restaurant Sales ForecastCalculating restaurant performance metrics is a necessary part of keeping your business afloat. The sales forecast formula is pretty straightforward, so it can easily be done by hand, or you can utilize your restaurant POS system to create your sales forecast. 1. Calculate Your Restaurant’s Daily CapacityLet’s say your restaurant has 10 tables of four.On a busy evening, ideally, all 10 four-tops are full and each table seats two parties each night. So, you can project that the kitchen and your servers will be presenting 80 main courses to eager diners per evening (4 diners x 10 tables x 2 turns = 80).The calculation would go like this: an entire evening’s dinner service would attract 80 patrons, and you know from your POS data that the per-person ticket size is $20. Sales Forecast = Table Count x Seat Allotment x Average Ticket Size x Table TurnSales Forecast= 10 Tables x 4 Guests per Table x $20 per Guest x 2 Turns per NightSales Forecast = 10 x 4 x 20 x 2Sales Forecast = $1,600Just like that, your restaurant sales forecast for a busy evening is $1,600.To gather a useful data set, you must also apply the same process to quieter evenings. Calculate your sales forecast for nights when the restaurant is half-full, or when one seating is busier than the other. You can use this method to forecast restaurant sales for any time period from a single evening shift to a full year.By looking at the estimated highs and lows, you’ll establish your restaurant’s weekly baseline, and get a clear vision of what your best-case and worst-case scenarios could be on a daily, weekly, and monthly basis.Since you’re working with scenarios and estimates, at the close of each night, you can compare actual sales to your estimated sales. Sometimes your original estimate will be spot on, sometimes reality will fall short of your predictions, and on other occasions, you’ll exceed your expectations beyond belief. Resource The Restaurant POS Comparison Tool A free, customizable Restaurant POS Comparison Tool to research and compare point of sale systems in one Excel spreadsheet or editable PDF. RESOURCE Find the right POS for your restaurant's unique needs You must have Javascript enabled in order to submit forms on our website. If you'd like to contact Toast please call us at:(857) 301-6002 First and last name* First and last name* is required Email* Email* is required Phone number* Phone number* is required Restaurant Name Restaurant Name is required What is your current POS? 2Touch POS Advantix Agilysys Aldelo Aldelo Light Ambur Breadcrumb Breakaway International Brigade Brink Clover DigitalDining Dinerware Focus Foodtec Gusto Halo Harbortouch Hula Leaf Maitre' D Menusifu MICROS 3700 MICROS 9700 Microsale MICROS Simphony NCR - Aloha NCR - Compris NCR - RPOS NCR - Silver None - Cash Register None - Paper & Pencil Other Partech PDQ Pixel Point Positouch POS Lavu Revel Revention R Power Salido Sam4s Shopkeep Sicom Speedline Square Squirrel Talech Task Retail Technology TouchBistro Transax Treatware Trident Versitouch Vivonet Winrest XPIENT What is your current POS? What is your current POS? is required Zip Code Zip Code is required By requesting a demo, you agree to receive automated text messages from Toast. We’ll handle your info according to our privacy statement. Additional information for California residents available here. 2. Use Sales Data to Conduct Sales ForecastsRather than taking out a calculator shift after shift, you can utilize pre-calculated metrics from your POS to conduct sales forecasts.By using restaurant analytics collected from your POS system, you can review detailed sales reports from your restaurant's history to make forecasting easier. Some systems allow you to compare dates and look at peak sales by the hour and menu item. With the support of a POS system, especially one that has inventory management software, you’re able to do a much deeper dive into your sales — past, present, and future — and you can make projections without flipping through a four-inch-thick log book. Why Conduct a Restaurant Sales Forecast?Restaurant data analysis is an essential step in smart decision-making for your business.By looking at analytics collected from your previous sales reports, you can make data-driven decisions about staffing, inventory, expansion, and more. Here are a few places where analyzing your sales forecast comes in especially handy.Inventory ProjectionsHow do you decide how much hamburger meat you should order for next month?Because sales forecasting is based on historical sales numbers during similar time periods, your forecast can help you predict your sales in a given year, month, week, day, or even hour, with a certain degree of accuracy. This includes how much inventory to purchase to cover all shifts without running out or having tons of spoiled food. For instance, looking back at the past ten Fridays – assuming there are no holidays or special events in the mix – can give you an estimate of the number of hamburgers you can expect to sell on each Friday of the upcoming month.Naturally, in a restaurant, there's always some unpredictability. You may have an unexpected surge of orders or an unusually slow night. Still, sales forecasting works to give you an estimate of how much of what food will sell. Seasonal SuccessWith a backlog of data and a solid sales forecast, you’ll be able to predict your sales for certain scenarios – like holidays, seasons, events, hot or cold weather, etc.When you review data, you may spot that a stretch of cold weather is the catalyst for an increase in business at your cozy restaurant. By referring to last winter’s sales data, you’ll see how costs fluctuate when the temperature does, and you’ll be prepared to capitalize on the opportunity with ample staffing and supply levels. Smart StaffingWith a restaurant sales forecast as your roadmap, you’ll be navigating employee scheduling with ease.Labor costs are one of the biggest expenses for restaurants, so when you add labor into your sales forecast, you’ll be confident you’re making the smartest possible staffing decisions because you’ll have the data to back you up.For example, if you typically have lower sales volume on Tuesdays, you’ll require fewer hands on deck, so you’ll know that it’s budget-friendly to operate with a smaller team, in contrast to your generally busy Friday nights where you’ll want to staff up.Profit ExpectationsAt the end of the day, a restaurant is a business. To stay successful, you need to know how much money you can expect to make in a given period of timeKnowing your projected sales volume helps you set price points and make plans for your business growth. Would you feel comfortable making a big equipment purchase or renovating your restaurant if you knew your business was entering a slow season? Should you hire that new assistant manager right now if you won't be able to break even until April?Being a restaurateur is the same thing as being a businesswoman or businessman, so frequent sales forecasting is essential.Considering all the things that constantly affect your restaurant’s revenue, it’s nice to know that you can rely on data to predict every shift. Sales forecasting gives you the ability to insightfully schedule your staff, purchase your inventory, and manage profit expectations. Products Toast Point of Sale Learn how a better point of sale system can help you run your restaurant. Related Restaurant Financial ResourcesRestaurant Business Plan TemplateBar Business Plan TemplateFood Truck Business Plan TemplateCoffee Shop Business Plan Template DISCLAIMER: This information is provided for general informational purposes only, and publication does not constitute an endorsement. Toast does not warrant the accuracy or completeness of any information, text, graphics, links, or other items contained within this content. Toast does not guarantee you will achieve any specific results if you follow any advice herein. It may be advisable for you to consult with a professional such as a lawyer, accountant, or business advisor for advice specific to your situation.