Archive for June, 2007

Controlling Profitability

Controlling profitability can be relatively easy to achieve if you understand and implement specific financial management skills. Food/beverage costs and labor are the two highest controllable costs for any restaurant, regardless of size. Since food costs can consume as much as 33% or more of every sales dollar, it is important to have systems in place that address portion control, inventory management, waste, prep and pull procedures, comp and coupon control, and more.

Using quantitative as well as qualitative measurements enable restaurant managers to keep their fingers on the financial pulse of the business, while never losing sight of the service quality or customer and employee satisfaction levels. It is equally important for managers to know the percentage of each dollar of revenue that is consumed by labor costs and how to control those labor costs by using available labor metrics. Of course, knowing your labor costs and controlling them are two entirely different subjects. That is why it is also necessary for managers to be scheduling experts with the skills and abilities needed to balance service quality standards and customer experience against the costs of operating the business effectively and profitability.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Income Is Not the Same as Profit

When the front of the house is full and the kitchen is just short of being backed up, it’s easy to think you’re making money as you watch the cashier process ticket after ticket. And the truth is: you probably are making money; but, it’s not how much you make that counts – it’s how much you get to keep.

The secret to managing with a goal of profitability is to achieve the perfect balance between overhead costs and sales. This may sound easier said than done, but it actually is relatively easy to achieve if you understand and implement specific financial management skills. Restaurant managers are not accountants, nor should they be expected to be. However, they are the people whose decisions have the most ability to impact a restaurant’s bottom line and managers do need to have access to the tools and technology necessary to get the job done.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Several months in development, our new Media Kit is ready for public distribution. The Media Kit is a great reference if you need a one-stop document to quickly understand what TimeForge.com can do for your employee scheduling problem.

It can be downloaded here.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Online Dedicated Scheduling Software

Online dedicated scheduling software offers all of the advantages of offline software without the drawbacks. Access to the software is permitted from any Internet-enabled computer. This means that managers can work from home or from anywhere they can access the Internet. This also means, with most online vendors, that employees can check their schedules from any location.

Unlike offline dedicated scheduling software, online software upgrades are automatically made available the moment they are released so there are no upgrade costs. Online dedicated scheduling software is the most cost-effective solution for restaurant managers who need to tightly control labor costs while maintaining the ultimate in scheduling flexibility.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Offline Dedicated Scheduling Software

Offline restaurant scheduling software is more effective than both paper-pencil scheduling and POS-based scheduling modules. The software is specifically designed for scheduling restaurant personnel; it is created with your restaurant’s specific needs in mind. Most of the available packages provide a method for inputting sales figures and tracking payroll costs using one or more metrics. These features enable management to balance scheduling needs with financial needs and make intelligent scheduling decisions based upon traffic and costs.

Because the software is so highly specialized and tuned to the restaurant industry, most users spend less time scheduling, while achieving optimal payroll savings. The unfortunate downside is the fact that the software is usually licensed to work on one computer at a time. There is an additional cost for adding more workstations if needed. While it is likely that only one workstation is needed at the physical restaurant location, the licensing restrictions precludes managers from working on the schedule at home or from any other remote location. Another downside is that there are upgrade costs whenever a new version is released. Not paying these costs result in out-of-date software that does not have the newest available features.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Point Of Sale System Scheduling Modules

Some Point of Sale (POS) providers offer scheduling capabilities. The issue with this solution is that the capabilities offered by these POS providers are simply an electronic adaptation of the pencil and paper method. These modules store employees’ names and usually provide a way to call up the previous week’s schedule and either print it out with the new dates or allow the manager to make scheduling changes prior to printing. They lack in-depth decision support tools and financial analysis capabilities. Without these essential capabilities, you might as well just use the paper and pencil method.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Pencil and Paper Scheduling

Scheduling with pencil and paper is the oldest method of scheduling and is widely used among owners and managers of small capacity restaurants and those restaurants with few employees and no complicated shift requirements. If you are running a restaurant with one cook, one counter waitperson and another to handle the handful of booths and tables, paper and pencil scheduling is probably the easiest and least expensive way to get the job done.

For all other types of restaurants, however, paper and pencil scheduling is inefficient and provides no decision support tools that can help a manager automatically forecast scheduling needs based upon historic trends. Pencil and paper scheduling also lacks a way to measure and track the schedule’s effects on payroll costs.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

In preparation of our next major update, we did need to make changes to several user accounts to conform with our new features. Specifically, all username accounts are now lower-case, so if your username / login was amazingRestaurant@aoL.com, it is now amazingrestaurant@aol.com Please let us know if change causes any problems with your business; we can change your username to something suitable for you.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

Fixed Labor Costs and Staffing

There is a certain fixed labor cost that a restaurant can not drop below without affecting service quality levels. These costs include the minimum staffing levels required to open the restaurant each day and do the prep work. Optimal staffing procedures call for gradually increasing scheduled wait and kitchen staff as the restaurant moves towards its daily peak traffic times and cutting staff as the volume wanes.

A schedule that looks good on paper may not actually work as the week progresses. Scheduling is constantly a work in progress that is governed by these guidelines:

1. Train shift managers to ensure that everyone is working to their full capacity.
2. Do not overstaff on shift managers.
3. Monitor kitchen, wait and support staff and adjust for peak and off-periods as necessary.
4. Senior management or owners should review schedules created by subordinates on a regular basis.
5. Establish and review cut policies to avoid over-staffing during slow periods.
6. Ensure that shift managers closely monitor staff to ensure that side-work and opening/closing duties are being performed efficiently and as quickly as possible.
7. Calculate payroll costs at the end of every pay period.
8. Monitor payroll percentages to be sure that they are in line with sales.
9. Adjust schedules during the week to reflect business realities.

It takes good scheduling skills and close monitoring to keep payroll costs under control but the end result will be a noticeable increase in profits.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.

How to Calculate the Payroll-to-Total-Sales Ratio and Other Ratios

1. Total all payroll costs for each shift.
2. Divide the total by each shift’s gross sales.
3. Multiply the result by 100 to convert the number into a percentage

Payroll-to-Total-Sales Ratio = ((Payroll/Sales) x 100)

There are other metrics available that some believe provide an even more accurate measurement of payroll costs. Here are three of the most popular:

The number of covers per labor hour (Total Labor Hours/Customer Count)
The total cost of labor per cover (Total Payroll Costs/Customer Count)
The total cost of labor per labor hour (Total Payroll Costs/Total Labor Hours)

All of these metrics provide a way to measure labor costs, but they don’t provide a solution for controlling labor costs. When used in conjunction with one another, and considering your restaurant’s particular situation, these measurements and ratios can be helpful in pointing out problem areas within your business. These measurements alone should not be used as a launching point for major structural changes.

How long does it take to make an employee schedule? It should take less than 5 minutes! Did you know that labor costs could be as much as 30% of your expenses? TimeForge can help streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, or club.