Small Business Guide to a Restaurant Management System

What is a restaurant management system?

A restaurant management system is a type of point-of-sale (POS) software built specifically for restaurants, bars, food trucks and other food-service businesses. While the best restaurant POS systems handle essential front-of-house tasks like orders and payments, a restaurant management system goes further by supporting the behind-the-scenes work that keeps a restaurant running smoothly.

In addition to payment processing (including restaurant mobile payments), restaurant management systems typically handle inventory tracking, staff scheduling, order management and other daily tasks that employees would otherwise manage manually. Bringing these functions together in one system helps reduce errors, save time and improve visibility across the business.

“An RMS is like the digital backbone of restaurant operations,” said Jayanti Katariya, CEO of Moon Technolabs. “It consolidates tasks like order tracking, inventory control, and even analytics into one system, which saves time and reduces errors.”

What is the difference between an RMS and a standard POS system?

While both tools fall under the broader POS category, they serve different roles in restaurant operations:

• POS: The best POS systems focus on front-of-house essentials like taking orders, processing payments and managing order flow during service. Many also include basic reporting and menu management features.
• RMS: An RMS goes beyond basic POS functionality to connect front- and back-of-house operations. These systems typically support inventory tracking at the ingredient level as well as staff scheduling, tableside ordering, split checks, kitchen display systems and food-cost management, creating a more complete overview of operations.

Spencer Michiel, a restaurant technology advisor at Back of House, described an RMS as a broader, more connected ecosystem rather than a single transactional tool.

“A restaurant management system is an integrated group of software and hardware solutions, often referred to as a tech stack, that helps manage and optimize a restaurant’s operations,” Michiel explained. “These systems bring together tools for managing essential functions, such as sales, inventory, staffing and food costs, creating a seamless flow of information.”

What are the benefits of an RMS?

For many restaurants, the biggest benefit of a restaurant management system is simply having fewer things to track manually. An RMS brings key parts of the business into one place, which can reduce errors, save time and make it easier to see what’s happening day to day. Common benefits include the ability to:

• Monitor real-time sales performance and order history.
• View accurate, up-to-date financial data.
• Manage staff scheduling more efficiently.
• Access business data through the cloud from any device.
• Use built-in customer relationship management (CRM) tools to build email lists or run loyalty programs.

“An RMS is much more than just digital ordering,” said Deepak Shukla, CEO of Pearl Lemon Group. “It’s a comprehensive tool designed to streamline every aspect of restaurant operations. … This versatility allows restaurant owners to enhance service quality, minimize waste and make data-driven decisions to optimize daily operations.”

What types of RMS are available?

There’s no one-size-fits-all restaurant management system. The right option depends on how your restaurant operates today and how much flexibility you want as you grow. Most RMS platforms fall into one of the following categories.

• End-to-end systems: End-to-end RMS platforms offer the most comprehensive setup. They typically include core POS system features along with inventory tracking, CRM tools, staff scheduling, menu and order management, payment processing, reporting and customer support. Many vendors let you mix and match features so you’re not paying for tools you don’t need.
• POS-based systems: In this setup, the POS acts as the foundation, with integrations for third-party tools like inventory management tools, accounting software and marketing platforms. This modular approach works well for restaurants that already rely on specialized software and want to upgrade their POS without replacing everything else.
• iPad- or Android-only systems: Restaurant tablets make it easier for staff to move around the floor, handle numerous functions and adapt what they’re doing during busy service. Before choosing a system, you’ll want to decide which operating system — iPad or Android — fits best with your existing hardware and workflows.
• General POS systems: Some POS systems are designed for businesses that combine food service with retail sales. These platforms support both use cases and often include add-on modules that let you customize the system for restaurant-specific needs.

What can I manage with an RMS?

Depending on the type of restaurant management system you choose, an RMS can cover a wide range of day-to-day operations. With a full end-to-end system, most restaurants can manage nearly every core function from a single platform, including:

• Employee schedules, including daily shifts, vacation time, sick leave and other paid leave
• Payroll processing
• Financial statements
• Inventory tracking and food waste monitoring
• Accounting
• Reporting and analytics
• Core POS functions
• CRM functions
• Menu management
• Reservations and table management

Taken together, these tools help reduce the need to juggle multiple systems or spreadsheets throughout the day.

“An RMS is designed to work cooperatively across multiple functions to manage all the key aspects of restaurant operations,” Michiel noted.

What should I consider before getting an RMS?

Because a restaurant management system touches so many day-to-day operations, it’s worth taking time to choose one that truly fits your business. Start by identifying what you want the system to do and which features are must-haves versus nice-to-haves. From there, focus on these key considerations:

• System type: Think about how you plan to run your restaurant day to day. If your operation relies on Android devices, an iPad POS system won’t be a good fit. Likewise, if you want most of your tools in one place, an end-to-end RMS may be the most practical, and often the most cost-effective, option.
• Ability to scale: If you plan to grow, open another location or franchise, your RMS should be able to grow with you. Look for systems that support multiple locations, sync data across units and offer advanced reporting, multibranch add-ons and flexible employee scheduling.
• Ease of use: Running a restaurant is demanding enough without having to troubleshoot software during a dinner rush. Before committing to an RMS, spend time testing the system to make sure it’s intuitive for both managers and staff. Look for a platform that’s easy to navigate, quick to learn and simple to troubleshoot when issues come up.
• Integrations: No RMS does everything on its own, so integrations matter. Make sure the system connects easily with other software you already use or plan to use, such as reservation platforms like OpenTable or Resy. Strong integrations help you avoid duplicate data entry and keep information consistent across your operation.

When considering integrations, it’s important to think beyond reservations and scheduling. “Ensure the RMS integrates well with any existing tools, like POS or payroll software, so it can grow as your restaurant expands,” Katariya advised.

Restaurant management system pricing

RMS pricing depends on an operation’s size, complexity, number of locations and more. The following factors should be carefully considered: 

• System complexity needed: How much you’ll pay depends largely on how much functionality your restaurant needs. Shukla said simpler RMS platforms often fall in the $50 to $500 per month range, especially for single-location restaurants with basic requirements. Michiel noted that costs climb quickly for more complex operations, with large or enterprise-level systems sometimes costing $1,000 per month or more, depending on size and setup.
• Hardware considerations: Hardware can also add to the total cost. Integrated tools such as kitchen display systems (KDS), handheld ordering devices (like mobile POS systems) and self-service kiosks often require upfront investment in addition to software fees.
• Pricing model: Some RMS vendors sell their software through a one-time purchase. You pay a hefty amount upfront and own the license, which can keep monthly costs lower later on, but the initial price tag is much higher. More often, RMS platforms are sold as subscriptions. With this model, you pay a monthly or annual fee instead of a high upfront cost. That makes it easier to get started, but those recurring fees can add up over time.

Features to look for in restaurant management systems

The right restaurant management system should do more than keep things organized: It should help you run more efficiently and increase your restaurant’s profits over time. As you compare options, look for systems that include the following core features.

1. Sales and tax tracking

A good RMS tracks detailed sales data, including top-selling menu items, peak service times, staff performance and overall profitability. This information helps you spot trends, make smarter pricing decisions and prepare accurate reports for tax filing.

2. Order management

Your RMS should make it easy for staff to manage tables, reservations, checks and menu changes in one place. It should also support takeout and delivery orders alongside dine-in service so kitchen staff can see all orders in one place. If you run a bar, look for features like credit card preauthorization to open tabs. When order management is centralized, service runs more smoothly, and the risk of costly mistakes drops.

3. Inventory management

Knowing exactly what you have on hand — and how quickly it’s moving — helps you decide when and how much to reorder. Better inventory visibility can reduce food waste and keep food costs under control, both of which directly affect your bottom line. Some RMS platforms include inventory tools, while others require integrations with third-party software.

4. Reporting and customer data

An RMS that tracks sales and customer behavior gives you valuable insight into what’s driving repeat business. You can use this data to refine marketing efforts, personalize promotions and better understand customer preferences. For example, some systems let you send birthday offers or credits for future visits.

5. Marketing, gift cards and rewards programs

Many RMS platforms offer built-in marketing tools, such as promotions, loyalty programs and rewards. Automating these efforts based on customer behavior can encourage repeat visits without adding extra work for your staff. If gift cards are part of your strategy, make sure the system supports issuing and tracking them, whether through built-in tools or integrations.

From the front doors to the back of the house

A good restaurant management system can make a noticeable difference in how smoothly your restaurant operates. While there are many factors to consider, taking the time to define how the system should support your business — and what you want to get out of it — pays off. Once you have a clear goal and a list of non-negotiable features, you’re well on your way to choosing and implementing a restaurant management system that fits your operation.

Max Freedman and Sean Peek contributed to this article. Source interviews were conducted for a previous version of this article.