Managing employees for your restaurant is a full-time job, especially when you have new hires joining the team. To get you and your new employee focused on the important aspects of training for success, it's great to have a simple onboarding checklist to get crucial paperwork completed for the employee's file.
One of the largest obligations a business owner has is conducting payroll. Tracking, reporting, and executing payroll for your restaurant involves many tasks to ensure accuracy, timeliness, and compliance. Payroll duties should not be rushed; otherwise, costly errors may occur resulting in upset employees and penalties from government agencies.
You may be keeping the books for your restaurant in-house, which takes a certain number of hours each day, week, and month. You may also have someone on staff or in your immediate family handling the accounting needs. At some point, maybe you decided to outsource your payroll or you installed a new point-of-sale system to track hours. Shortly thereafter, as your business began to grow, you found another service to handle tax preparation and filing.
This type of piecemeal approach for handling your financials can sneak up on you in a hurry. And while you may be making the right decisions in the moment, such an approach is not ideal for long-term profitability and growth.
The restaurant industry tends to experience high employee turnover rates compared to other labor forces, which puts a strain on owners and managers to recruit, train, and retain top talent within their local labor pool. The latest numbers from a National Restaurant Association report indicate a turnover rate of 66.3% in the restaurants-and-accommodations sector, compared to 44.4% overall in the private sector.
As a restaurant owner or operator, you have a lot of spare time at the end of the day, right? Didn't think so. We know the challenge of managing daily activities of your business is tough, but it's important to touch base with outside resources periodically to stay ahead of the curve in local and national industry trends.
Last month the Minnesota Department of Labor & Industry released it's 2015 Minimum Wage Report. Restaurant owners are acutely aware that the state raised the minimum wage to $9.00 an hour effective August 1, 2015. The report indicates more than half (57%) of hourly workers employed in eating and drinking establishments earned the minimum wage, by far the highest percentage among industries. Given that tips are a significant aspect of employee compensation and many foodservice employees receive the minimum wage, restaurant owners need to be very familiar with Minnesota laws regarding tip credit, pooling, and sharing.
It’s not uncommon for restaurant employees to receive discounted or free meals before, during, or after their shift. In addition to making employees feel appreciated, providing them with opportunities to taste the product (and learn about the various dishes) might give them an edge in selling to customers.
It is important, however, to properly account for employee meals in order to keep inventory and financial statements accurate as well as to document employee benefits for expense and tax purposes.
A movement to discontinue tipping has been gaining traction among high-end restaurants in large metropolitan areas. Proponents of the shift have defended the move as a way to stabilize wages and benefits for employees, build teamwork among staff, and deliver a more enjoyable dining experience for customers. Other restaurateurs have pushed back citing that servers, bartenders, and other staff members who rely on tips would fail to put forth their best effort. They also argue that subsequent increases in menu prices will deter guests from visiting their establishments.
Restaurant margins are slim. To maximize profitability in today’s economy, you need an accounting service that acts as a true business partner -- one that is as concerned about your restaurant's success as you are in each stage of growth for your business.
Creating a weekly schedule in the restaurant business is an arduous task -- you have to consider employee availability, peak hours and days, upcoming local events, potential employee training, and even elements outside of your control, such as severe weather.
Many operators will use a POS system or scheduling software to help them in the process. Others may still be using a hand-drawn matrix to complete the task. Regardless of the system you have in place, if you are not using sales projections as part of the criteria for scheduling employees, you may be leaving money on the table in terms of labor cost as a percentage of sales.