Labor is a perennial challenge for restaurant operators, but it can be made a bit more manageable when a business can retain its managers. One-third of restaurant managers quit in their first year on the job, according to research from TDn2K, and the consequences are especially difficult on a restaurant’s finances and culture. Replacing managers – particularly general managers – tends to cost restaurants far more in lost productivity than it does to replace other roles. What’s more, their absence has a domino effect on the remaining team members, who may lack the direction and structure the manager provided to help run the business. You can take steps to slow the revolving door when it comes to these key members of your team. Toast suggests screening manager candidates carefully to find the best match for your culture and team for the long term, not being tempted to fill a position quickly with someone who you haven’t considered carefully through interviews and reference checks. You might even split the role into two roles to improve your chances of retaining institutional knowledge if one person were to leave. Then take steps to invest in their success. A recent global survey of middle managers conducted by McKinsey & Company found that only 20 percent of middle managers feel that their organizations let them be successful people managers, while 42 percent either don’t receive any support or are uncertain if they do. How does your turnover rate for your managers compare to that of other staff? Providing fair compensation is important to helping managers feel supported, though just as critical are noticing signs of burnout, providing sufficient time off, and giving them space to share feedback and concerns openly.
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For years, restaurant operators in many states have faced the prospect of ballot initiatives aimed at raising the minimum wage and eliminating the tip credit. This year could be especially eventful. Wage-related ballot measures are planned in Michigan, Arizona, Ohio, Massachusetts and Connecticut, and are pending in a number of additional states. (Recently passed measures have strong potential impacts: The one passed in Washington, D.C. in 2022 requires business owners to eliminate the tip credit and raise service employees’ wages from $5.35 an hour to $16.10 by 2027. Sean Kennedy of the National Restaurant Association said the D.C. measure could have such consequences as reduced restaurant workforces, higher menu prices or added surcharges, and fewer restaurant openings – and similar results are likely happening elsewhere too.) For restaurant operators struggling to eke out a profit, such efforts can ignite a scramble to identify places to shave costs. At a time when restaurant tech is making it possible to scrutinize expenses, are you using the tools at your disposal to identify and eliminate any hidden waste and the costs that result from it? Analyze your labor costs per hour across your business to ensure you understand how they compare to your other expenses and overall revenue. Where can you make adjustments to scheduling to ensure that your staffing closely reflects the ups and downs of your traffic? There may also be opportunities to train staff on additional tasks so that the people you have on board are ready to handle a range of responsibilities and don’t have unnecessary lulls during a shift. This can feed into their development as well, which can help you better manage turnover – another regular expense you may be able to take steps to reduce. Finally, if you have any manual processes in your front and back of house, flag the ones that you can automate or delegate to tech-based tools. This will lighten the load on your staff too.
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