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Profit margins in the restaurant business are paper thin. It’s a dream to open your own restaurant, but sometimes keeping things going can feel like a nightmare. Even the most popular restaurants can struggle if they don’t keep a tight lid on expenses. Controlling your costs is one of the most important parts of running a successful restaurant.
The average labor cost a restaurant faces is 30.5 percent of sales revenue, including both front and back-of-house. Cutting those costs can mean the difference between survival and failure in the restaurant industry, but scale back too far and you can find yourself understaffed on the floor or in the kitchen. Your team just won’t be able to provide quality service and quality food when they’re trying to pick up the slack because there aren’t enough hands on deck.
Great restaurant owners won’t sacrifice the quality of their food to save on ingredients – neither should they sacrifice the customer experience. You need to strike a balance between trim labor costs and top-quality service.
Luckily, there are a few scheduling hacks you can implement in your restaurant to start saving money.
#1 Split Shifts
For restaurants that open for lunch and stay open late into the night, the split shift is your secret weapon to saving.
A split shift is what happens when an employee has a long, unpaid break separating two parts of their work day. Typically, the break is longer than one hour and they’re free to leave the premises. A split shift is an effective way to help you control costs during those slow times in the afternoon.
The split shift is often dreaded by employees, but it doesn’t have to be. In Spain, pretty much the whole country operates on a split shift schedule, thanks to the siesta (which in the 21st century is more likely to be spent on a long lunch or running errands than napping). One way you can keep employees on a split shift happy is to make sure you don’t start them too early. Consider letting them come in to handle the lunch rush, and head out before returning for dinner service, while those working straight through handle the set-up and clean-up.
#2 Restaurant Scheduling Software
You can save 1-3% of your labor costs using restaurant scheduling software like 7shifts. It’s a mobile app that includes restaurant scheduling functions, time clocking, team communication, shift pooling, manager log books, and leave request management. It’s an all-in-one platform that shows you more data at the push of a fingertip to make better decisions about scheduling. Investing in restaurant scheduling software from 7shifts can save your restaurant a lot of money.
#3 Cross Training
Cross-training your staff to cover multiple positions means you won’t be scrambling to get shifts covered when someone calls in sick or with an emergency. That means training bussers to wait tables, servers to bartend, and vice versa. When you cross-train employees, you get a more flexible staff who can pitch in and help each other out.
Labor costs are a challenging aspect of your restaurant to cut, but with the right know-how and technology, you can make it happen.
Ryan Yarbrough is a small business consultant, speaker, and the manager at Davis Financial Services, a small business consulting firm.