Employee-Generated Revenue and Scheduling
Many factors contribute to finding the perfect balance between employee productivity and labor costs, while meeting business-level demands. Add the additional factor of seasonal patterns, and the formula becomes even more complex. However, don’t be discouraged because there are a variety of methods to help you understand how to properly staff your business to maintain high revenues.
Appropriate staffing is crucial when operating a successful business. But how much revenue should each employee generate for your business to operate effectively? Researchandmarkets.com, which specifically targets the restaurant industry, notes that, “The [restaurant] industry is labor-intensive: annual revenue per employee is roughly the same for large and small restaurants, about $35,000.” According to the Introductory Training Class at the PreGel AMERICA Training Center, the average daily revenue per employee should fall in the $300–$400 range, for a business whose product mix is coffee, pastry and gelato. With the help of a little math, we can calculate that based on a 5-day week, 50 weeks per year (including vacations and other absences), the employee average adds to an estimated amount of $100,000 in generated revenue.
The next issue to tackle is how to maximize each employee’s productivity or the optimum revenue amount that each employee could generate. We excel at things we truly enjoy, so the best way to maximize your staff’s productivity is to have them enjoy coming to work. To achieve synchronicity between their personal and professional lives, employee input on scheduling is essential. The scheduling process can be as simple as asking each employee to submit their “dream schedule.” Although not everyone’s wishes will be met, the basis is set for a better understanding of the staff’s preferences.
It’s also important to incorporate responsibilities that the employees will enjoy completing and perfecting. The responsibilities assigned to each position should be equally attractive to include the ability for professional and/or personal growth, opportunity for increased responsibility based on performance and the possibility to contribute to the overall success of the business.
Staffing schedules during peak or seasonal business times can be best determined with the help of historical data. Track the sales and staffing levels for both your busy and slow seasons by day. Incorporate negative weather conditions, such as blizzards and colder temperatures, but do not neglect the positive weather conditions that may have drawn customers out to your establishment. Weather acts as a major factor that will drive the customer traffic either to your business or encourage them to stay indoors.
Other factors to consider when staffing throughout the year are:
- Local events, such as festivals and fairs, may enhance or decrease your business, depending on your proximity to the given event.
- In-store promotions – ask yourself what effect they had in prior years and would you be including them in your marketing plan this year. • National holidays and on what day of the week they occur should be considered. Holidays that fall on long weekends will have a larger impact on your business than holidays occurring in the middle of the work week. Also note that the day before a holiday tends to see a heavier business level, regardless of its position within the week.
- Local school schedules – winter and spring break comes around, and students and their families tend to explore retail and hospitality businesses during this time.
- Business trends – compare your revenue for a given number of weeks or each quarter of the current year versus the same period in the prior year. If your business is trending upward, chances are that you will continue that trend. Increasing your staff coverage may be needed to ensure the high level of customer service that your customers deserve and expect.
For maximum productivity and minimized labor costs, the factors listed above are major contributors. Keep in mind these components: be selective when hiring your staff, maintain open lines of communication, engage and challenge your employees, and monitor the service levels for each shift as it progresses. The perfect balance of these factors will not only result in increased productivity, but will bring mutual benefits for the employees and your operation alike.