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Hospitality sector raises a glass to cloud-based analytics as it roars back to life

In a normal year, hospitality can be a crazy-busy business. Waiters taking orders, chefs rattling the pans, bartenders shaking cocktails, a veritable maelstrom of activity at the pass. At the end of a shift, it can be hard to find the energy to finalise tomorrow’s menu and staff roster, let alone to go through the day’s receipts and fine-tune strategy to make the business even better.

That’s precisely what hospoIQ was developed for.

A cloud-based system, the first brainchild of New Zealand–based 2IQ, hospoIQ offers business intelligence for the hospitality sector. It brings together point of sale (POS), rostering, wages and accounting data into one clear dashboard and insights platform that also provides projections, comparisons and overlays so businesses can adapt in real time.

Hospitality was one of the hardest hit sectors of the economy when COVID-19 struck; while some were able to operate a takeaway service, many others closed their doors. Now, as hospitality gets into gear again, it’s facing challenges – good staff are hard to come by and keep, rules and regulations about how they operate continue to change, and customer expectations have shifted. It’s even more important that businesses have a good grasp on how they are performing and what the future might hold.

Built on Microsoft Azure, hospoIQ is elastic and scalable by design. That meant that when businesses did have to shut their doors to customers because of the risk posed by COVID, hospoIQ was able to suspend customers’ subscriptions – providing welcome relief from a monthly bill that they may have struggled to pay.

Now it’s all systems go again, according to 2IQ co-founders Andrae Gaeth and Craig O’Loughlin.

Gaeth, who is also the CEO of 2IQ, says hospoIQ allows businesses to monitor wage costs against sales day by day, explore historical patterns and predict demand to help optimise rosters for the next week.

O’Loughlin, who is the Chief Operating Officer at 2IQ, says hospoIQ lets a business owner quickly assess if they are making money or not.

Traditionally, a lot of hospitality businesses would rely on their accountant telling them at the end of the month, which is probably too long before they realise that they’ve lost money,” he says, noting that hospoIQ provides easy access to gross profit, margins and wage costs.

Gaeth adds: “It’s probably making them think a lot harder about what items they should be selling because these are the things that actually give them the best margin. When you’re doing well and you’re selling tons, then it probably doesn’t matter so much. But when you’re selling less, you actually need to be thinking harder about what things to sell because you need to be making sure you’re making good margin.

“Gross profit has become something that’s a lot more important to hospitality businesses – both their wage costs as well as their gross profit on the items itself – so things like the recipe costing is really important. I think a lot of providers previously hadn’t really thought that hard about what does go into a menu item and what’s the actual cost of selling that. That’s something that the solutions really helped them with.”

According to Debby Rosevear, Administration Manager at Vieceli Hospitality, which operates six bar brands in the Christchurch area, says hospoIQ provides the company with clearer and more concise reporting, particularly on KPIs.

Managers would be in touch with their numbers, and we needed meaningful breakdowns of these metrics. And we wanted it in a simple format that they could easily digest. hospoIQ ticked the boxes.

Expanding horizons

Developed on Azure, hospoIQ collects data from different systems, including cloud accounting platform Xero, and captures it in Azure blob storage, before directing it to Azure SQL databases where it can be analysed using Power BI.

hospoIQ’s proprietary algorithm allows users to explore recent weekday patterns and compare that with what happened a year earlier, or see the impact of different events based on a calendar that hospoIQ maintains. For example, if the city was hosting a major sporting event or concert.

Of course, there were no calendars predicting a global pandemic, but hospoIQ was able to suspend customer subscriptions because of Azure’s inherent elasticity and scalability, reducing their costs during a difficult period.

2IQ, the parent business of hospoIQ, has now launched MyIQ. Initially focused on liquor franchising and retail, this delivers similar benefits to hospoIQ by offering live historical or predictive modelling through Power BI.

hospoIQ is being used in New Zealand by organisations including Savor Group and Armadillos, while Perth-based Sneakers & Jeans has recently signed up as one of 2IQ’s first Australian customers.

Falstone Hospitality, which operates Top Hut Sports Bar, 65 Dine Gastropub & Smokehouse and Super Liquor in Twizel, New Zealand, uses the system to provide insights about the business.

According to owner Darrin Burgess, hospoIQ delivers a service and a solution that exceeds what the company requires.

They provided more knowledge with live linked data that gives accurate, up-to-date reports from front of house and back office at our fingertips. The conversations we have with our managers are far more intelligent. We can offer them tools to be able to control and report back with their business units.

Gaeth notes that hospitality groups are among the companies that have enjoyed the biggest gains from using hospoIQ.

“If they’ve got 10 or 20 or 30 sites, then it’s especially difficult for them to get their information because they’ve got all these disparate sites,” he explains.

“With our solution, because we’ve got gateways pulling all the data into the Azure cloud, we can consolidate all their information into one central database and then provide them a consolidated set of reports through Power BI.

“That same issue is being found with retail franchises as well, particularly liquor franchises. You might have a liquor group that’s got 200 sites. Again, they’ve got point of sales across all their different sites, but they had no way to actually get consolidated information through Power BI because a single point of sale can’t give you that information.”

But hospoIQ has been designed to provide clarity at a glance across the entire business – something it believes is worth cheering about.