August 22, 2016
Foodservice Labor…Measurement or Mindset?
Eight Best Practices
Running a profitable foodservice program requires dedication to details and a mindset that expects results. Good c-store operators know that achieving high labor productivity is not an accident. It’s the result of effective measurement systems, sincere effort and consistent daily execution across every aspect of your operation.
To maximize your labor productivity, you must embed high standards within the very core structure of your operation. Adopt the philosophy “Less is More”. Simply preparing a labor schedule won’t cut it. The following are eight (8) Best Practices we work with our clients to implement.
Achieving high labor productivity (and controlling labor cost) starts with proper menu engineering. The key here is high variety, low complexity. Complex menus take lots of labor and will generate more cost than the profit they generate.
Review all menu items and recipes to revamp any recipe with more than ten (10) ingredients and five (5) preparation steps. Retailers should ensure that every ingredient in the operation has multiple uses, especially any pre-prepped recipes. This will go a long way to helping your labor cost come within reasonable levels.
Design & Layout
Once you have a well-designed menu, then you need the right lay-out. Think assembly line and mass production. Walk the production of every recipe. If you cannot make the finished item for the customer without taking more than four (4) steps in any direction, rethink your lay-out.
Your lay-out should be designed to be able to handle a one-person execution at slow times, with enough room to double up functions during peak times. You want a compact lay-out, floor to ceiling.
Ensuring you have the right equipment will make or break an operation. If the equipment slows down service, change it. Utilize pre-portioning techniques whenever possible. Don’t get mentally hung up on the labor it takes to portion.
If the item warrants being on the menu, then the pre-portioning time is worth it. Focus on high-cost items and short holding time items. This will help make opening and closing more efficient and reduce waste.
Remember the five (5) rules of storage (Label, Date, Initial, Rotate, Cover) and implement this always. While it takes a moment to implement, this practice will save you labor in the long run, improve your profit, and increase your foodservice safety. Utilize all wall space with racks to reduce preparation times.
Now that the program is set-up for higher productivity, you must adopt a practice by which to measure labor. One of the easiest and most effective ways to measure labor is by Sales per Labor Hour (SPLH). When able, you should measure this by job function to further reduce labor. Naturally this requires you track foodservice labor separately.
It is critical to get a time clock system that gives you live-time SPLH readings. You cannot expect to achieve best in class and labor cost levels in the low 20%’s if you are not willing to invest in the time and tools to be the best and measure by dayparts.
At bare minimum, track on clipboard manually by register readings on sales for morning, lunch and then dinner and check SPLH, then adjust your labor based on what has happened on each shift. Don’t wait until mid-week to discover you are over budget. By measuring dayparts, you will uncover precious labor hours that you can shift to sale building mode, rather than waste on labor inefficiencies.
Truly controlling labor means you must be pro-active. Making a weekly schedule and posting it is re-active. It is important that when you make a labor schedule that you review previous weeks’ SPLH by shift and day.
Record previous week results and react each day by tracking productivity on a clipboard in the back room. You should know your weekly performance daily.
Embed a mentality into the operation that every labor hour spent must be focused on sales building; track and reward accordingly. Cleaning and prepping is only one aspect of the operation. Building sales is the cure-all for all high labor cost issues.
Spend precious labor on training staff about product knowledge, presentation, product levels and, most importantly, controlling out-of-stocks. You cannot sell something you don’t have on display. Customers buy with their eyes so high impact merchandising is a must.
When applied, these Best Practices will yield amazing results. The first step is commitment to excellence, and the second is follow-through and execution. Both are equally important.