For Italian restaurants, the industry-wide labor crunch is a real threat. Despite hourly turnover rates plateauing this year, the restaurant industry as a whole still faces a massive labor shortage. Though that turnover may have stopped growing, TDn2K reports that it has topped out at an astronomical 132 percent for quick service. Additionally, manager turnover, which measures at 50 percent, is still on the rise.
If turnover alone wasn’t challenging enough, restaurants are also finding a much smaller talent pool to hire from. In 2018, the nationwide unemployment rate dropped to 3.7 percent—the lowest mark in 49 years. Though that number has once again bounced up above 4 percent in January and 3.8 percent in February—the latest month for which there is data—this still indicates a tightening group of workers.
This makes it especially challenging for Italian restaurants to find skilled labor. While burger chains, for example, may be able to find talent from any number of concepts with experience running a grill, it is not as easy to locate kitchen staff with experience crafting house-made pasta.
Additionally, with rising wages and hiring costs nationwide, restaurants are being forced to decide whether to increase prices and potentially upset consumers, or to do more with less. TDn2K also reports total labor costs account for 33.1 percent of a chain restaurant’s total revenues. Yet employees and managers cite higher paying opportunities as a top reason for seeking other jobs.
Sales in the Italian segment are creating additional pressures. While the restaurant industry as a whole experienced 1.4 percent same-store sales growth in the third quarter of 2018, BDO reports, the publicly-traded pizza segment didn’t fare as well, measuring in at a 0.8 percent decrease. Much of this, however, was weighed down by the struggles of Papa John’s in the wake of its founder and former chairman’s reputation scandal. On the flip side of the equation, Domino’s has fronted industry results for some time now, including domestic same-store sales growth of 5.6 percent in the fourth quarter—the 31st consecutive period of positive gains. Pizza Hut’s progress has been a bit challenged recently as it looks to redefine its portfolio and move away from the dine-in pressures facing U.S. units and its “Red Roof” locations. Same-store sales ticked up 1 percent stateside in the fourth quarter for the 18,431-unit YUM! Brands chain.
With all of these mounting pressures, it’s critical for Italian restaurants to find ways to reduce both turnover and labor expenses to stay profitable. Fortunately, restaurant technology is providing brands with tools to help drive sales while minimizing expenses and labor strain, even when staff is short. By letting computers help, restaurants can improve efficiency and offset the costs and challenges of this labor crunch.
1. Streamline Scheduling
Labor management may be one of the biggest pressures facing the restaurant industry now, but with a little help from computers, it’s also one of the easiest ways restaurants can buy back efficiency. Yet many restaurants either rely on hand-written schedules or computer-generated schedules that don’t scale to the complexity of the current labor landscape.
Hand-written schedules, for example, are time consuming to create. Not only do they require managers sit in a back office instead of helping team members or restaurant guests, but they require managers have in-depth knowledge of sales patterns attributed to weather, holidays, and local events. Those aspects are difficult enough for an experienced manager to keep in mind, but even more so for new managers. Mistakes in scheduling can cause overspending on payroll when it isn’t needed and understaffing if, for example, a manager forgets to account for a big convention in town, potentially risking guest satisfaction.
Bad schedules can also put an entire brand at risk. As more cities and states throughout the nation enact predictive scheduling laws that place requirements on how businesses schedule hourly employees, it has become even more difficult for restaurant leaders to keep up with regulations—particularly for multi-unit operators doing business in multiple regions. Not only can predictive scheduling mistakes lead to costly fines and penalties, but they also create reputational liabilities.
Better schedules also make for happier employees and managers, and happy managers and employees are less likely to look for new opportunities. Yet keeping employees happy can sometimes be at the expense of a good schedule. Shift swap and time-off requests, for example, mean a lot to employees, but managing the requests and remembering to schedule accordingly can be a headache for restaurant leaders who have to figure out how to cover for absent team members. Computers, however, can generate a schedule that keeps employees and managers happy by balancing workload demands with employee availability.
Automating scheduling can reduce the strain on managers and ensure all these factors and more are taken into consideration. Now that some scheduling software such as the HotSchedules Clarifi platform integrates AI technology that can take predictive scheduling regulations into consideration, for example, restaurants can help make their teams more productive.
2. Speed Up Training
Training is another area in which Italian restaurants can improve efficiency. Onboarding new employees is both costly and time consuming. Not only does it eat up managers’ time to source new talent and ensure they are learning about the brand, but during the time it takes for new employees to get up to speed, a restaurant may be short-handed. This makes it crucial for new employees to learn quickly, but not so quickly that they don’t retain their lessons and risk damaging the brand’s reputation.
Finding the right pace between quick, yet thorough and consistent training is difficult to do. That’s why many companies produce training manuals or e-lessons that ensure employees get the same message every time in every store, but restaurants aren’t offices. back-office computers don’t teach employees what it’s really like to work in a kitchen or interact with guests. Similarly, training binders and recipe cards get dirty when taken into the work space. It’s time consuming for managers to print out new lessons every time corporate wants to change its procedures, and corporate offices don’t know if pages have been updated by every store, leading to potential cooking or service errors.
Instead of these out-dated training tools, some restaurants are using digital training tools that let new employees take lessons straight into the workspace. PlayerLync, for example, helps restaurant digitize lessons into videos and recipe cards that employees can access via mobile devices they can take with them into the kitchen. Some brands mount these devices at work stations so new employees can reference lessons while they learn on the job. This not only helps speed up training time and boost confidence, but it helps employees retain lessons better through the dual learning experience.
Another benefit to digitized, workplace-based learning is existing employees feel more valued and ultimately helps to retain employees. These tools can remain in the workplace for existing employees to reference, too, and demonstrate a brand’s commitment to investing in its employees. By empowering employees to seek out the information they need, brands send the message that they care about giving employees what they need to be successful. It also means that employees have resources even when managers are busy, buying back manager time.
3. Boost Kitchen Efficiency
The kitchen is the heart of an Italian restaurant, yet when there are labor shortages, kitchen teams are often the first to suffer. Not only must there be enough staff to handle prepping and cooking food, but effective kitchens also require many other tasks to ensure optimal performance, such as labeling, temperature tracking, and inventory management. As more restaurants are faced with doing more with fewer employees it’s important to give kitchen staff the tools to be successful despite staffing churn.
Though it’s all about the food, these other tasks are critical to ensuring kitchen staff members can do their jobs. Yet when restaurants are understaffed and employees are overworked, these are often the first tasks that get skipped. Failing at any of these tasks can not only create kitchen slowdowns and operational strain, but they can also be brand management nightmares. Failing to comply with regular temperature checks could be the difference in serving good food and making people sick and damaging a restaurant’s reputation. Incorrect labeling can set restaurants up for allergen contamination. Bad inventory means restaurants run out of supplies and disappoint guests or waste ingredients that expire before they can be used.
By automating these processes, restaurants can ensure these tasks are completed every time. For example, automated temperature sensors can ensure temperatures are tracked even when restaurants are busy. Additionally, because software like TransAct Tech’s BOHA! system, which integrates checklists, labeling, temperature tracking, inventory, and more, communicates with other systems restaurants seen an overall more efficient back-of-house. For example, by tapping into recipe cards, labeling software is more effective.
Additionally, removing these kinds of mundane tasks helps employees spend time on the tasks they care about, like cooking or spending time with guests. This leads to an overall increase in job satisfaction, potentially reducing turnover.
While Italian restaurants today face operational strain from a number of inputs, there are ways they can begin to earn back revenue lost to wage and labor churn. By automating tasks so staff is more efficient and tasks are done more accurately, Italian brands can ensure they stay viable for years to come.