Quick Serve Restaurant (QSR) brands are all familiar with the frustration associated with inaccurate orders. As consumers, we have all experienced and understand how annoying it can be.
On average, as many as 16% of orders in quick service and fast casual restaurants have problems severe enough for customers to both notice and report the issue. When this happens, well-managed restaurants typically offer customers a full or partial replacement of the order and/or another form of compensation.
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But what's the real cost of inaccuracy for brands?
For one quick-service restaurant, Market Force calculated the real cost of inaccuracy to exceed $26 million annually.
Of that $26 million, the direct cost of replacing inaccurate orders makes up only about 7% of the total cost, or $1,820,000.
The much larger cost of inaccuracy comes back to the QSRs indirectly – through lost loyalty, fewer return visits, reduced or simplified customer orders, or other negative brand associations. We estimated this source of cost at 67% for in-store dining experiences ($17,420,000) annually.
The balance of total costs, at 26%, or $6,760,000, is associated with inaccurate deliveries: an issue that has increased since third-party delivery companies like GrubHub, Uber Eats, and DoorDash have grown in use and popularity.
What is the long-term effect of inaccuracy in the restaurant industry?
We estimate the long-term cost of inaccuracy to represent a negative impact of 38% of the total value of the individual customer. If one single instance of inaccuracy has the capability of affecting a restaurant so significantly, this suggests that brands must ensure customer orders are accurate, as often as possible.
Build loyal customers with Market Force
Market Force specializes in both pieces of this story: the data collected to determine the incidence rate and true cost of failure, and the opportunity to recapture customers effectively using technology-enabled contact centers.
Inaccuracy can result in lost loyalty and fewer return visits. Our CX measurement and consulting services can help your restaurant identify root causes of failure, estimate the financial damage of failure, and provide proven strategies to help optimize your performance.
Schedule a demo with our customer experience experts to see how our programs can work for your quick service restaurant.
