I'm a restaurant manager.... But what am I doing!????

Updated: Mar 23, 2021

First of all, there is a good chance that you are doing exactly what you should be doing!

Let's talk about the reasons why...

1) You love food and beverage.

2) You are great with people.

3) You are a great host.

4) You are passionate about the business.

5) It's fun!

And the list likely goes on.

So when I say "what am I doing?" I don't mean in terms of career. I mean in terms of all of the challenges that are presented daily.

Today, I would specifically like to discuss the management of labour cost. I was having a conversation with a good friend, who I grew up in the industry with. We were talking about how we remembered when we started out managing in restaurants, and wages were much lower, "hitting labour" seemed pretty easy! As long as we were where we needed to be, sent staff home when things slowed down, and we got the close done on time, things were usually pretty good. But... there were times when that wasn't the case. There were times that for some reason no matter what we seemed to do, the labour cost on the report the next day was really high! Speaking for myself, I always dreaded those days because I just knew my GM was going to ask me "Were you even paying attention last night!? Labour is through the roof!." I was always so confused because I thought I had done my job the night before...

Then there were the opposite days, when no matter what we did, or how full our roster was, that labour just seemed to be really low! I was always nervous on those days too because I knew that my GM was going to say something like... "There is no way service was any good with labour that low!" Again, I was confused... For one because service was great! Secondly because it felt to me as though I had run the exact same shift as the day that labour was high. Third, because lower labour meant that we made more money... yet my GM wasn't happy. It was a continuous guessing game. Crazy thing is... it still is for most restaurant managers. This is the norm.

The reason, if you ask me why this is the case, is because percentages are what hit the statement at the end of the month, and that is how we as an industry have always looked at managing labour cost, along with everything else in the business. Labour is a direct reflection of sales so we have to measure it that way. Sound familiar? I hope it does.

Now, what if I told you that as a manager in charge of that percentage day to day, that you actually have very little control over it? That there are so many variables in play that you could do everything right on your shift and not achieve the right percentage, which unfortunately sometimes reflects negatively on you (which it shouldn't!). It doesn't mean that you are off the hook, it just means you may need to look at it differently.

Let's dive into this a bit... What are the variables that go into labour cost? How the schedule is written, what each person gets paid, training, sick calls, overtime... There are probably more. What about sales? Happy hour? Promotions? Special occasions? Contests? Strong sales staff? Weak sales staff!? Day of the week? Weather....? The list is almost endless.

However, if you are a manager who can control all of those things and still be involved in service, then you are one of a kind!

So I am on a mission to change this view of how to manage the biggest cost in our industry. Labour cost! Wages are going up, people are harder to find, and if what the "experts" say comes true... restaurants are going to be busier than ever when things get back to "normal!" The Roaring 2020's!

The only way to be the manager to "hit" labor every day, (which is a key performance metric for so many managers), or to be the restaurant that consistently gives amazing service AND is as profitable as possible in this category, is to apply systems to each one of those variables I mentioned above. It is possible to be as consistent as you want to be, and believe it or not, it is possible to attach strategy to each of those items (except maybe weather!).

Until the industry stops playing a guessing game in terms of how they manage labour cost, and realizes that just trying to achieve a certain percentage of sales is like aiming at a moving target, there will never be financial sustainability in the business. Yes, percentage is what shows up on the statement. Yes, percentage is what the bank looks at. But realize that percentage is a result... NOT a strategy!

Think about it this way. In baseball, you want to have as high a batting average as possible, and let's say a certain player wanted to achieve a .300 average for the season. If you asked the player what they were working on in order to achieve a .300 average, would they just tell you "I'm working on hitting my average"? Or "I'm going to work really hard to get there"? Or "I just go out there and do it"? I don't think so. They would probably tell you specific parts of batting that they are working on, like hitting a curve ball, keeping their head down, or just making good contact. They would have strategies in place in order to achieve the goal.

The same is true in your business.

If you have thoughts on this subject, leave a comment! If you want to talk more about it, leave a comment! Or if you disagree... leave a comment! Let's work together to build a more financially sustainable future for our beloved industry.


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