How Many Restaurant Employees Do You Really Need?

How Many Restaurant Employees Do You Really Need? Restaurant labor costs are one thing. Having the right amount of labor to handle the business walking through the doors is a completely different thing. So how do you determine how many restaurant employees you really need? Stick with me, and I’ll give you two key indicators to use in your restaurant to determine how many restaurant employees you really need.
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Welcome to my KZbin Channel. I am David Scott Peters, a restaurant coach and speaker who teaches restaurant operators how to cut costs and increase profits with my trademark Restaurant Prosperity Formula. Known as THE expert in the restaurant industry, I apply my no-BS style to teach and motivate restaurant owners to take control of their businesses and finally realize their full potential. Thousands of restaurants have used my formula to transform their businesses. To learn more about me and my coaching program, visit www.davidscottp....
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After watching this video, you will not be able to walk away with the perfect formula for success when determining how many restaurant employees you really need. But you can use these two key indicators to use in your restaurant to determine how many restaurant employees you need based on the numbers.
Key indicator #1: down and dirty dollars per labor our work calculation. When I say down and dirty, we're not going to get into a detailed spreadsheet and look at everything by hour. Instead this is a cursory level. Are you being efficient or not? What do you need for this? Get the hours worked by position, such as how many bartender hours, how many cook hours, prep cook hours, dishwasher hours, etc. Then you need total sales by category based on the position you’re trying to check for efficiency. Based on the position, what do they produce? You’re going to tally up by category those total sales, then take the sales for each one of those categories and divide them by the hours worked. This is going to give you dollars per labor hour worked. Say it's $150.
Then take it one step further. Look at your sales per ticket, divide it into per person, the average per person sales by category, the same way you just did it for the dollars per labor hour worked calculation. If you look at your total ticket, it's $35 per person, but X percent of sales is food. Let's say now you calculate a $25 per person for food. You need that number versus the $35 since a server is going against food and liquor sales, but the kitchen is not.
Now, take your dollars per labor hour worked, that $150, and divide it by the average per person by category. For kitchen that would be the $25. So for every man hour behind the line, they produce $150 in sales divided by $15 equals six. That is six entrees an hour on average. That's basically what we're trying to calculate. And when you look at that number, you're going to determine whether that's a good number or bad number. If you’re getting numbers like six entrees an hour, you want to aiming for 25 or 30, depending on your concept. You need to know your criteria, how complex your menu is, what the sale prices of your average food item and use all that information to determine if you’re efficient or not.
Key indicator #2: minimum staffing. For each position, you're going to write the absolute minimum number of hours for each day for each position and total it for the week. Create the slimmest schedule, period. Whether you did $1 or up to $10,000 in the day, what is that minimum? One cook on the line, one manager, one server, one cashier, whatever it may be, it's the bare minimum to get through.
You can total up all those hours in the minimum, divide it by eight, and you have the minimum staff you need for a shift.
You have to do some work interpreting the data and ask lots of questions that are important to your restaurant.
It’s my experience that 75 percent of the restaurants I work with find their efficiencies are upside down, and they have to rework their menus. What do you think you will find?
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[@user-tp6sb6lq5f]

Hi David , Thank you for making these videos. I am a chef that has worked in upscale casual/ fine dining establishments for the past 8 years. I have been involved in lower levels of management and now I am starting my own thing. I was wondering , what are some things you suggest to learn really well that will put me at the same level of financial wisdom of a vet that has been doing this for 20+ years ? Thank you again

[@DavidScottPeters]

Congratulations, CC, on taking the big leap and following a dream. To answer your question, start with watching all the video on my channel 😉 Pay special attention to the videos that teach accounting/financial reports and budgets. Knowing your numbers and what to target for your numbers will put you leaps and bounds ahead of a lot of other operators. Your budget is your plan for success and allows you to run your restaurant proactively instead of reactively. Let me know if you have more questions!