FORECASTING AT HARD ROCK CAFÉ*

With the growth of Hard Rock Café – from one pub in London in 1971 to more than 110 restaurants in more than 40 countries today – came a corporate wide demand for better forecasting. Hard Rock uses long-range forecasting in setting a capacity plan and intermediate-term forecasting for looking in contracts for leather goods (used in jackets) and for such food items as beef, chicken, and pork. In short-term sales forecasts are conducted each month, by café, and then aggregated for a headquarters view.

The heart of the sales forecasting system is the point-of-sale system (POS), which, in effect, computes transactional data on nearly every person who walks through a café’s door. The sale of each entrée represents one customer; the entrée sales data are transmitted daily to the Orlando corporate headquarters’ database. There, the financial team, headed by Todd Lindsey, begins the forecast process. Lindsey forecasts monthly guest counts, retail sales, banquet sales, and concert sales (if applicable) at each café.

The general managers of individual cafes tap into the same database to prepare daily forecast for their sites. A café manager pulls up prior years’ sales for that day, adding information from the local Chamber of Commerce or Tourist Board on upcoming events such as a major convention, sporting event, or concert in the city where the café is located. The daily forecast is further broken into hourly sales, which drives employee scheduling. An hourly forecast of $5,500 in sales translates into 19 workstations, which are further broken down into a specific number of wait staff, hosts, bartenders, and kitchen staff. Computerized scheduling software plugs in people based on their availability Variances between the forecast and actual sales are then examined to see why errors occurred.

Hard Rock does not limit its use of