The life of a restaurant manager is unpredictable; no two days are the same! From putting out fires to overseeing your staff, your day-to-day activities can distract you from looking ahead.
Over time, staffing duties, like scheduling, tend to become robotic habits, and instead of looking ahead, you fall into the dangerous trap of not-forward-thinking, rote behavior. This week, you’re encouraged to shake off your routine ways to save on labor costs. With some basic calculations, you can start reducing labor costs by 5%, starting immediately.
The trick is determining the optimal number of staff members you need at any given time. Below, we show you how to use your POS data to do just that.
1. Determine Your Sales per Man Hour (SPMH)
First, get an overall picture of how effective your scheduling is right now. Determining your sales per staff hour (SPMH) is a fast calculation to use. This formula calculates how much revenue is generated by the number of employees per hour. The more productive your staff is, the fewer hours required, and the lower your restaurant or bar’s labor costs become.
How to Calculate Your Restaurant SPMH:
To calculate your restaurant’s SPMH, divide your projected gross revenue per hour by the total number of employees’ hours scheduled at the same hour. To get these figures, log in to your Lavu POS. With the current SPMH, you can then work backward to get your optimal SPMH. From your calculations, you can then figure target labor costs.
Create a goal for your labor costs and share this future vision with your managers who create schedules. Easily train them on how to make changes in scheduling to optimize your revenue while decreasing the cost of labor.
2. Revenue Forecasting
Revenue forecasting for restaurants is a popular way of guaranteeing that your labor costs are affordable. However, what you want is for your labor costs to be profitable.
To get started, go back to your POS and pull up last year’s sales figures. You want to find your average sales over one month (you can also define your period by weeks or days). Once you have the average values determined for the year, you can use them to forecast restaurant sales in the future.
To work from a revenue forecast template, visit this link.
Once your revenue forecasts are complete, match your target sales to your target labor costs. Not only do you increase sales, but you also lower your labor costs.
3. Staffing by Units Sold
Staffing by units ties the number of units sold to the number of employees working. A unit—considered anything you sell—should be considered a significant sales item that regularly sells (like a burger or pizza). This activity-based scheduling technique works well for fast-casual or assembly-line-style restaurants but can be used by any dining or bar establishment.
If your restaurant or bar operates with uniform volumes of food production, scheduling by units sold is simple: First, calculate your projected units (check your inventory manager) for the day at 30-minute intervals. Then, determine how many employees are needed per interval by the projected number of units sold.
For example, to sell ten pizzas in 30-minute intervals, one server, three-line cooks, and one cashier are required.
If you project 20 pizzas, then one additional server, line cook, and cashier are required. That said, you want to pay attention and not rely solely on your calculations. If you notice variations between staff numbers and units sold, note the variables that are different (such as different hours of the day, hours of the week, or a specific employee’s productivity rates), and adapt your schedule accordingly.
Employee Productivity Reports for Scheduling
Each employee has strengths and weaknesses for their job and seeing how these differences affect your bottom line helps create a more cohesive schedule. Look for variations in units sold while different teams are on the schedule. Tracking productivity will not only help with scheduling but will also help with the following:
- Training employees
- More profitable employees
- Faster, more efficient teams
- Recognizing your best employees
- Seeing which employees need further training
Simplify your Schedule by Using AI
Scheduling doesn’t have to be all stress and mess with the use of master scheduling and AI. Keep track of time-off requests, preferred shifts, and hours of availability all in one place, and create a schedule at the click of a button. Integrate data on your employees and plug in the information into an automated scheduler, saving time, and creating a better work environment for your restaurant staff.
Input Time-off Requests
With a scheduling app, you can input time-off requests for restaurant employees to create a schedule that works around their needs. By using AI and apps for scheduling, time-off can easily be covered through shift-swaps to let other employees work open shifts and boost morale by fulfilling requests for time off by your staff.
Use your scheduling technology to input the availability of your staff members. When doing so, be sure you have the most up-to-date information from employees. Some employees of your restaurant will have outside obligations, whether they are going to school, have children in sports, or have other social engagements that require weekly time off from work.
With the availability of each employee stored in one place covering shifts is simplified. Give your restaurant manager access to schedule availability for all employees to make life simple when a shift needs coverage at a moment’s notice.
Part-time vs. Full-Time Employee Scheduling
With the use of AI, figuring out which employees to schedule full time instead of part-time is much simpler. Make sure your full-time employees are hitting their hourly requirements while avoiding overscheduling of your part-time employees.
Optimizing Your Restaurant and Bar Staff Operations
As a manager, your responsibilities are vast, and they extend to all areas of restaurant or bar operations. It’s critical to start thinking about ways to optimize them, in addition to managing them. Since labor costs are a necessity for your restaurant’s livelihood, you don’t want to waste them by not improving your system.
One of the biggest mistakes you can make is keeping the wrong people on staff. Unproductive and unmotivated employees will only result in lower output and fewer sales. But don’t be afraid to give someone a second chance to improve. Try sharing your target goals with your staff to get them more involved and invested in the outcome.
It’s just as important to employ a staff of team players. Running a restaurant is a group effort; the more in synch your staff is, the better they will work together (improving your SPMH!). Plus, your customers will feel the vibes of a well-run restaurant and have a better dining experience.
All the calculations in the world can’t help you, though, if one thing is missing: strong leadership. The most important ingredient to a high-functioning team is you. Be the manager your restaurant needs, and your staff will follow suit.
For more advice on perfecting the art of the restaurant schedule, check out these Lavu tips!