When I recently visited a restaurant trade show, I noticed that there were just as much companies presenting POS systems as there were stands with on-line reservation systems, while I haven’t seen any reservation system on previous visits. When something new comes up that fast, I immediately suspect a hype.
So when talking to the good ol’ POS dealers, I asked them if they had received customer requests for on-line booking systems and whether their systems includes or can be linked to such a tool. As I already expected and according to my own experiences, no-one had received requests for on-line booking systems from their customers, and therefore none of them had included such a tool in their system. Some POS systems did have a bookings screen, and I even found one system that offers an API to connect external applications to the reservation module.
After that I went to the other ‘side’ —the on-line reservation providers. I asked them for their experience in the restaurant business and whether they had linked their system to a point of sale. I found that most of these companies were technology driven businesses that only recently entered the restaurant market. With the exception of one —OpenTable—, none of these companies seem to know the way restaurants work. What surprised me even more is that nobody could offer integration with a Point Of Sale system. Restaurants need to install a dedicated terminal using either proprietary software —like OpenTable— or a web browser —like RestaurantDiary.
In my opinion the companies offering on-line reservation systems seem to miss two crucial points: space is scarce in restaurants, restaurateurs don’t want to put in another terminal of it is not absolutely necessary. And if they do, they will place a full POS system, and not a dedicated reservation system. Furthermore, the Point Of Sale is the centre of the restaurant’s automation system. The POS controls stocks, sales and workflow. Having two separate systems is a waste of resources. Client information should be available on the Point Of Sale, since client tracking is important.
So my conclusion is that on-line restaurant reservation systems are indeed hype, generated by techies with no feeling for what is going on inside a restaurant. In my view, restaurant reservation systems do have a place, but not implemented the way it is done now.
First of all, the system should be completely integrated in the POS system, for reasons I have explained above.
Secondly, these systems should target more. I never search the Internet for a restaurant in my home town, and I always phone to make a reservation, since the decision to go to a specific restaurant is usually taken on the street when meeting friends. When I am out of town for business or pleasure and have some time on hand, I never reserve a restaurant, but rather walk around and decide where to enter based on how the restaurant looks. The only time when I could need an on-line reservation system is when I am out of town, am very busy and do not have somebody who is taking care for me —usually my clients select and reserve restaurants. In that case I need a reservation system that:
- Has data for any place in any country I might be;
- Let’s me enter my current position and shows me all restaurants sorted on the distance from my current position;
- Shows me the basic details of the restaurant and comments/recommendations of other users;
- Preferably it should give me some suggestions based on previous reservations just like Amazon does: people who like restaurant X also like restaurant Y.
In other words: restaurant reservation systems have to be made with the guest in mind and not as an on-line marketing instrument for restaurants.
8 Responses to Restaurant reservation systems
Mike Conyers November 27, 2005
This is an interesting article. I would like to add that http://www.restaurantdiary.com understands exactly how restaurants work – perhaps more than you – as the system was built to my specification as an operator of 25 years. I still work front of house and use electronic EPOS (aloha) and do have a separate system for reservations on a brodband PC as do most of our operators. Currently our business is doubling every 3 months so somebody is seeing the benefit in our system!
We are keen to integrate with an EPOS system but find most EPOS suppliers are not so keen.
Jeroen Sangers November 30, 2005
Dear Mike,
Thanks for your reaction. I am glad to hear that at least some providers of reservation systems do have knowledge of the field they work in. As I stated above, most people I have talked with are ‘techies’ and web developers.
It is also good to hear that your business is growing. But I seriously think that part of the sudden huge interest in restaurant reservation systems is basically a hype. I still doubt whether many of the current users actually benefit from such a system, and wait until somebody performs an independend ROI analysis to prove so.
Integration with EPOS systems is always a difficult subject, as there are many POS manufacturers and even more companies who want to plug their system. That means that you will have to make agreements with hundreds of suppliers to cover a significant section of the market. In my view POS manufacturers will wait until there is an international standard for communicating reservation data. Until that moment some of them will probably try to create such a system themselves, and fail in doing so because of lack of market share.
I would like to know your view on the four points in which I described my ‘ideal’ resevation system. Are you planning such features?
Mike Conyers February 28, 2006
Jeroen,
I have a completely different point of view from you.
Thinking as an operator, with a unique selling proposition such as great chef, great food, great ambience, great location, I should be COMPETING with every other operator in the marketplace. Such an operator has no desire to be part of a “me too” listing or portal where he might get a share of the cake. Such an operator does not want to pay commission on bookings but wants to capture his own data on customers (who want to come to his restaurant in preference to others) and then to market to them his offer in exclusion to all others. We do live in a capitalistic society where the BEST win and thrive.
The 4 points you list are ideal for operators who are mediocre and content (desperate)to accept their “share” provided by portals.
An integrated epos / reservation system solution should have data feeds from the epos system to the reservation / table management / yield management / CRM system such as http://www.restaurantdiary.com. A browser based system is ideal for this as there is one point of entry for data capture but that data can be accessed and used from anywhere with an Internet connection. Also, with the application hosted on a remote server the solution can be very competitive in price with traditional PC or client / server solutions. I think Bill Gates agrees but what does he know?
The reason why operators use such a system as http://www.restaurantdiary.com is because of increased profitability (we are happy to let ANY independent expert assess the yield improvement in ANY of our operator’s units) and inbuilt marketing by SMS or email to their OWN customer database.
We agree that operators would prefer to have one hardware footprint front of house and as most epos systems now operate on TCP/IP it is a natural progression to an integrated solution where the data is shared but the operator can switch quickly from Epos to reservations using the same processor and screen.
Watch this space!
Regards
Mike Conyers
Victor Porter May 3, 2006
It is an interesting discussion on POS and reservation systems. We are a software company who offer POS and Booking systems for a range of industries. We are relatively new to the restaurant market and only got into it via restaurant owners who were frustrated at the lack of integration between all their systems.
The point made above is true, when I researched the market there were lots of POS vendors and separately a few reservation vendors none with an integrated system. Many of the POS vendors offered some kind of plug in to a reservation system or vaguely talked about being able to do it.
From my experience in other industries (and this definitely includes the restaurant business) owners want easy to use but sophisticated systems which are fully integrated with each other. So in a restaurant the POS, Stock, Pricing, Reservations and Accounts etc should be easily operated from the one terminal – be that a touch screen or other-wise.
Some of our customers have been so frustrated with this lack of integration that they are happy to switch from a perfectly decent touch screen POS or accounts system to roll out our solution which allows them full integration.
I also fully agree that any reservation system has to be focused on the customer, as well as having the smart features that integration with a POS system gives the restaurant. The four features above are a perfectly valid customer wish list. However I think there is an oft-made, important mistake in that everyone does things different, including which restaurant to visit and so individual’s wish lists can be very different. For example many people do like to plan which restaurant to visit and with whom well in advance. Many people visit the same place on a regular basis and not just walk in off the street. A system provider has to cater for all these (and many other) customer needs and design a system which is sophisticated and also easy to use.
I don’t think online reservation systems are a fad, the internet is real and more and more people are expecting to be able to check availability of restaurants and book tables online. Our customers are asking for these systems to capture these people in order to increase footfall and revenues. This can only be done by having a properly integrated POS and Reservation system which works over the internet.
At the start of any market there are always the technology-led vendors who will die off or bodge a solution with an existing player. The real value is in integrated solutions provided by companies who understand and meet business needs with technology as an enabler.
Victor Porter, Eveve Software Ltd
Jason Chiang March 12, 2007
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The Wizard of POS June 20, 2007
NY Times on the rise of OpenTable
It has been a while ago since I last touched the theme of Restaurant reservation systems. New York Times runs a story about the success of OpenTable, which wasn’t exactly an overnight success. The thing that pushed OpenTable over the edge toward accept…
barry January 11, 2012
restaurant diary is a great idea, but it seems as though its useless without lavish promotional schemes. i for one am completely fed up of relentless promotional schemes and just want a good price meal in clean surroundings – major cleanliness and quality reductions seeming to become de-rigeur in chains subscribing to all these promotional schemes.
Richard January 11, 2012
I used to work for an EPOS system provider and when my boss asked me to build an interface to restaurantdiary, i decided they had made it so difficult to interface to, and we had so little demand for it, that it wasnt worth the bother.