Here is some important advice from Restaurant

Ask any operator what their biggest cost concerns are and it’s very likely that labor cost will rank as first or second on the list. Surprisingly though, many operators don’t discover a labor cost problem until it’s too late. Only after paychecks have been issued do they realize their labor costs are too high. Controlling labor cost should be a daily undertaking. Several successful operators we know follow some or all of these practices for controlling their labor cost:

  • The weekly labor schedule is based on a worksheet showing projected daily sales (or customer counts) by meal period. This is used to help determine staffing needs for each department or job category based on how busy or slow the restaurant is expected to be (NEVERuse a fixed schedule that is repeated week after week).
  • From the schedule, a labor cost budget is prepared that shows the targeted labor hours and labor cost for each day. This is used as a daily labor hour/labor cost target to keep them on track with the budget.
  • Each day, shift managers carry a listing of scheduled employees for each shift (shift roster) that shows who is working and their scheduled clock-in and clock-out times, and the total number of hours they are scheduled to work. As employees near their clock-out time, the manager ensures that pre-close duties are being performed early enough to get the employee off the clock at or before the scheduled time.
  • Clock-in and clock-out errors are corrected as they occur. Employees hand their clock-out slip to a manager (or time card) for approval, so inaccuracies can be corrected before they leave. Many POS systems with time keeping functions allow editing. This practice also prevents employees from clocking one another out.
  • Have a contingency plan for slower than expected sales. Many employees are willing to leave early when not busy. Certain employees can be sent home early in the event they are not needed.
  • Employees are cross trained to handle multiple jobs. Having a few employees that can do many things is better than many employees doing a few things.
  • By checking labor hours daily, it’s easier to spot those employees that have worked more hours than they were originally scheduled. Those employees may have their schedules adjusted to compensate for the added hours in order to avoid overtime.

By incorporating these practices into your day to day routine you’ll avoid surprises on pay day, improve your labor productivity and have a lower overall labor cost.

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