How do you reduce staff turnover in your restaurant? Follow these tips to work on that risk of high turnover in the hospitality sector.
It’s never business as usual and change is what we do every day. The restaurant and hospitality sector is often at the leading edge of change and change management, and not always because it wants to be, but because it needs to be. With wafer-thin profit margins and employee turnover rates 20% higher than all other industries combined, it makes sense that the only thing left to do is manage change.
First of all, let’s look at some stats.
Turnover rates for the restaurant–hospitality sector in the US (Bureau of Labor Statistics):
Some of the common reasons employees give for leaving a company:
The insight here would be to offer better overall workplace conditions. Really, the opposite of everything I just listed. In addition, here are five tips that can help to increase staff retention.
The reasons and the tips I have highlighted to alleviate the challenges of employee turnover are universal to any business or establishment, but are seemingly more critical in hospitality given the turnover rates. Identify your needs and evaluate what you need to change today to bite away at those turnover rates. I’d love to hear about your challenges and successes with this: it’s definitely change for the long haul!
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What’s a good way to increase profit on every cover in your restaurant? Careful and sensitive up-selling.
Many in the hospitality industry rave about up-selling, but few put a dollar figure to it. Let me see if I can give you an example to help to maximize your profit. Done well, up-selling has a positive impact on your bottom line.
To highlight what I am talking about, look at this example. Let’s imagine that on average, your restaurant serves 75 dinners every night of the week. That makes 525 covers per week. Let’s also imagine that your well-trained employees, your top performers, start up-selling 75% of the time each week. That would translate to about 394 covers each week. Let’s further estimate that these servers are really good and manage to increase the sales on each of these covers by $2.50. That would mean an additional $985.00 in revenue per week, or $51,220.00 in a year! Even if your staff were able to up-sell $1.25 per cover, it would still mean an extra $493.00 a week or $25,610.00 a year for your establishment.
The power of up-selling is so huge, yet few include it in their orientation and employee training sessions. It’s almost as if they don’t need the extra sales!
Benchmark it today, get an average for each guest check or cover, create a simple strategy to start up-selling and measure your average cover again in 4 to 6 weeks: how much has it increased?
It’s a winning strategy all around. Your sales increase for little expense, the customers have an opportunity to have a more complete experience and maybe try something new (I’m thinking of perceived value here!) and servers’ tips increase.
Some tips for up-selling and suggestive selling:
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Mike has worked across Canada as a food and beverage professional and currently divides his time between writing and teaching people how to start and run their own businesses.