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Sundays are traditionally nights that you close early, and Monday is hardly a business day at all, often closed completely at some restaurants.

And when it’s just you running the business, it’s pretty hard to come up with a good reason to stay open late. If people like you, they’ll come when you’re good and ready, right?

But for those who are expanding, or do business in college towns, late-night customers are big business.

Bonnie Riggs, a restaurant-industry analyst at NPD Group says that late-night hours appeal to the younger folks. And when she says younger, we assume she’s talking about the college crowd which typically wakes up around noon and eats dinner anywhere between 10pm and 3am. Unfortunately she also notes that the majority of diners in this age group have been cutting back on dining out.

So why are thousands of restaurants extending their hours to get more people through the door, according to the Wall Street Journal?

Well, the fast food spots are doing it because it’s profitable. For them.

Forty-five percent of McDonalds are now open 24-hours and a third of Dunkin Donuts are too. And extending hours doesn’t just mean late-night, because Taco Bell just started opening earlier and launched a breakfast menu.

WSJ reports that it’s beneficial to extend hours because you can get more sales without any increase in rent. You can also completely eliminate opening and closing procedures.

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Unfortunately, what comes with the territory is that it’s either you, or one of your loyal employees who will be working those extra hours, which you’ll be paying for in one way or another. You also have to pay to keep the lights on, don’t you?

Maybe those expenses are no big deal for the bigger budgets of franchisees, but for the the middle class of business owners, those expenses add up quickly especially if all those extra hours don’t pay off.

Even franchise owners have made adjustments though, according to WSJ:

  • Pita Pit tested late hours in all of their locations and the ones that didn’t perform moved back to a regular schedule. Their VP recommends the well known trick of MBWA (Management by Walking Around), encouraging business owners to spend time in their neighborhoods at night to see how busy it is.
  • One of Pita Pit‘s franchise owners went around to local bars that were open late-night and found out that none of the bars served food. There was a serious gap for late-night munchies. She started staying open late and sales boosted by 10%.
  • The owners of one Checkers saw dismal results to their late-night hours the first month, but after word of mouth spread, late-night sales rose 65%. Because of this, the owner advised against being too hasty when making a decision about late-night hours.
So there are a few ways small business owners are testing hours, as seen above. They survey the scene, test, and they iterate. But there’s something more scientific out there and we’re OK about bragging when it comes to our heatmaps which track your sales by dates and times. See an example below:

Consider this transaction visualization as the MBWA of the future.

In the heatmap above, the darkest cells have the highest average sales. A business owner using Upserve to process credit card payments only needs to look at his heatmap of transactions and can predict that Friday and Saturday are the two days where later hours might be appreciated. And once those late-night hours are implemented, he can see if the longer days pay off by looking at the same chart.

Not only that, but he can see where business is lagging on other days and nights of the week and come up with creative promotions for those slow spots. Taco Tuesdays, for the record, are my favorite weekly promotion. Some people like Meatloaf Mondays but I’d love some data about who’s rushing in to any restaurant for meatloaf (no offense, Downcity).

If your transactional data isn’t being turned into useful charts like the one above, you need a new payment processor. Like us.

Check out Upserve’s Restaurant Expenses Tracker!

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As part of Upserve’s family of more than 10,000 restaurants, The Chef is Restaurant Insider’s secret weapon in the kitchen. As a restaurant expert in all things marketing, menu building, management, training and more, restaurateurs trust The Chef and the award-winning Restaurant Insider to dish out the ingredients needed to make your business a sweet success.
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