Second to food costs, labor is the second largest cost for restauranteurs. Depending on a restaurant’s concept, labor costs can run as low as 25 percent or as high as 40 percent. As a benchmark, 30 percent is considered a healthy average to aim for your food cost. The good news is that labor is a variable cost and there are steps you can take to improve it.
Scheduling is normally a dreaded task on the to-do list, and whether it’s one person’s job or a shared responsibility of the management team, it is important to use a consistent form of scheduling. Here are eight smart scheduling strategies that will not only save you money and time but eliminate the stress that comes with the task.
Using your historical sales trends alleviates the guess work of what you can expect to sell. Sure, a large party might walk in right at closing and you will need someone to stay late, but typically, your historical trends will be a good indicator of your labor needs. Pay attention to peak hours per day to see where you can scale labor back. Perhaps there is a slow sales period mid-afternoon between the lunch and dinner rush when you can cut a few servers or kitchen staff. Also notice seasonal trends such as conventions, sporting events, and patio weather in which you may need to augment your staff.
Staggering clock-in times allows you to increase labor as sales increase throughout the day. If each shift starts out slow and builds sales, overlap labor to have employees on the clock only when you need them. This can also be used to rotate opportunity amongst your staff
Another unnoticed cost is employees who clock in early. For example, if you have 25 employees who clock in 10 minutes early and make $8/ hour, that’s $33.33 in additional wages per day, or $12,166.67 per year. Locking down your POS so that employees can only clock in within 3–5 minutes prior to their shift starting will save you money.
If you are tracking full-time and part-time employees for benefits or ACA compliance, you will need to be mindful of who should be scheduled as full-time and who should be scheduled as part-time. Looking at historical labor trends will help you determine who has part-time and who has full-time status.
The cost is not attributed just to regular hours worked but also over time, double time, shift or employee meals and if you live in an applicable area, special pay. If any of these may apply to your business, consider the outcome when creating your schedule as a preventative measure.
Know your employees’ strengths and weaknesses and use them to your advantage when scheduling. Take a good look at which day parts are busiest for you. It may be more important to have someone who is quick and efficient for a busy lunch shift to avoid unnecessary comps and someone who is a master at upselling to increase revenue during a slower dinner shift.
Cross training ensures that you have enough flexibility to react to any situation that may arise, without having to call in additional help. Having a busser who can run food or a server who can help behind the bar can help you avoid disappointing customers if an unexpected crowd came in or if an employee no shows. It can also lead to a more cohesive team as employees are given the chance to see and respect one another’s tasks and roles first-hand.
Automating your schedule makes it more accessible, gives employees empowerment and reduces the burden on managers. Often, someone needs to swap, drop or pickup shifts. To tackle this, you might consider using a shift trade book or posting, where employees can self-manage these activities. This has the knock-on effect of allowing the manager to approve all changes in one place. This will save you employee labor hours and dissatisfaction, as well as your manager’s time building a schedule.
Creating a schedule is about more than just covering shifts. Good scheduling processes can positively affect your customers, employees and revenue. While having adequate staff on hand to accommodate your guests is your top priority, keeping your staff happy is a close second. You can find a balance between the two in which everyone wins.
As CMO of Compeat, Kristi Turner oversees product marketing strategy, competitive positioning, brand awareness, digital presence, customer retention, lead generation, inside sales, and internal and external communications. With over 27 years of domestic and international strategic business and marketing experience, Kristi has a successful track record for building scalable SaaS revenue growth, empowering employee cultures and customer centric marketing strategies. Kristi holds a bachelor’s degree in Mass Communications from University of South Florida. She resides in Atlanta with her husband and two children.