Editor’s Note: The follow is a guest post by Julie Powell, senior director of market insights and competitive intelligence at Toast.
From Thanksgiving catering to New Year’s Eve champagne toasts, the final two months of the year see restaurants operating at their maximum output. But as January arrives, bringing colder weather and tighter diner wallets, that hard-earned exhale is cut short. The holiday rush is over, and the real work of navigating the off-season begins.
Instead of just enduring the slowdown, savvy operators use January to refine their strategy. They pivot from maximizing transactions to improving profit margins and building future customer loyalty, addressing the core financial and operational challenges that define the modern restaurant landscape.
Solving for profitability and efficiency
According to Toast’s 2025 Voice of the Restaurant Industry Survey, 40% of restaurant operators surveyed cited improving profitability as their top goal going forward. While December is about capturing raw revenue, January forces operators to concentrate on genuine profitability, making it a pivotal month for financial success.
A sudden dip in covers exposes any unnecessary costs in labor, inventory and marketing that the holiday volume often masks. With inflation (a top-three pain point for 20% of operators queried in Toast’s 2025 survey) continuing to pressure margins, inaction now doesn't just hurt the bottom line; it can make long-term sustainability that much harder to maintain.
This is where today’s best technology offers a powerful solution. One key to navigating this period is implementing digital systems that automate back-office processes, engage guests to drive traffic, and empower staff to deliver flawless service even during lean shifts.
Automating the back office to find your margin
January's quieter pace provides the rare operational gift of time and bandwidth to implement the critical software changes you could never manage during the holiday rush. When sales dip, every minute spent on manual administrative tasks is a minute taken away from high-value tasks like kitchen prep, staff training, or marketing strategy. The first critical step in a “January Reset” is automating the most time-consuming operations, typically labor and inventory, to lock in long-term efficiency.
Stacey Lane of The Cookery, an Italian eatery in Seward, Alaska, implemented a unified team management system in January 2025. Lane described spending nearly four hours on payroll every two weeks, manually compiling tips and hours. By integrating a labor management system directly into the operation, her payroll processing time was cut to minutes, reducing errors and freeing her to focus on business growth.
“All I had to do was assign the job [they’re] doing that day,” Lane explained, “and [our new system] adds up the hours with the corresponding rate and figures out the tax calculation. It does all of that for me.”
More generally, restaurant technology platforms should offer capabilities that replicate this success, which include:
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Integrated labor tracking: Connect time clock data to payroll and scheduling tools. This cuts administrative time while also enabling accurate, minute-by-minute visibility into true labor costs relative to real-time sales, allowing on-the-fly shift adjustments to enable staff efficiency — a priority for 47% of operators responding to the 2025 survey.
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Automated cost analysis: Use automated inventory tools to track ingredient waste and calculate the precise food cost of every menu item. This allows you to adjust portion sizes, replace high-cost ingredients, or run margin-boosting specials, helping avoid unnecessary losses.
The missing ingredient: Personalized value
Hospitality is about making people feel seen, but the numbers show we’re missing the mark. In another recent Toast survey of 1,446 restaurant guests in the U.S. who have dined in, ordered takeout, or ordered delivery in the last three months, a few trends emerged on what motivates guests to dine out.
Only 20% of guests surveyed feel they consistently receive a personalized experience. How can this be improved? While nearly half of guests want loyalty rewards (49%) and discounts (48%) tailored specifically to them, most are left waiting for that personal touch. That’s a massive gap — so restaurants can use tailored rewards to show guests you see them as plain as day.
Basu Ratnam, founder and owner of Inday, an Indian-inspired fast casual restaurant group that operates nine locations in New York City, says that personalized loyalty rewards are key.
“There’s a lot of fatigue or disinterest in the general spend $50, get $5 back kind of rewards tiering. We're really focused next year on trying to figure out how to make offers a little bit more dynamic, a little bit more personalized. Take into account your natural customer frequency or your inclinations on the menu side and try to build the incentives around those behaviors.”
With 79% of diners surveyed citing value as their top motivation when selecting a restaurant to order from, according to Toast research, generic offers just become noise. In addition to value for their dollar, takeout guests demand frictionless digital experiences; for dining in, reputation and service quality are paramount. It’s the little things— like a reward that actually fits their habits— that prove you understand them, turning a budget-conscious diner into a loyal regular.
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Targeted outreach: Send guests on your email marketing list more personalized campaigns using data from their previous dining experiences with you. For example: Send them a personalized email campaign promoting a new "January Reset" or "Wellness Week" menu.
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Loyalty incentives: Leverage a loyalty program to offer double points or a small reward for a visit during a traditionally slow period, such as Monday-Wednesday lunch. This incentivized traffic helps keep the kitchen running and staff engaged during non-peak hours.
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Capturing large-scale guest engagement: Beyond daily loyalty, the same platform should unify your systems to attract high-value, large-format orders — like catering and events — which are valuable for filling the January sales gap. Waterhouse Restaurant, a casual fine dining restaurant in Peterborough, New Hampshire, is a powerful example; they boosted catering sales by 240% during Thanksgiving after adopting an integrated events and catering tool. By making the booking and payment process easy for guests, they captured these high-value orders. When using the right platform, Waterhouse Restaurant General Manager Linda Quintanilha said, "No order is too big or too small."
The gift of January
The post-New Year’s slowdown is a critical gift. By dedicating this window to operational efficiency and data-driven guest engagement, operators can stop revenue bleed, convert downtime into training time and implement the necessary digital tools.
Use the reset to build a resilient, profitable foundation for the rest of the year. This preparation is a competitive edge heading into Valentine's Day and through holiday seasons ahead.
