Traditional metrics are hurting restaurant performance -> And why it is time to look through a new lens.

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Every restaurant operator I speak to is always thinking about "prime cost", aka the combined cost of food and labor.

Being that these are the two biggest costs associated with a restaurant operation, I don't blame them.

What I do believe though is that the business model has changed so much over the last few years that strictly looking at prime cost as a % is actually hurting the performance of the restaurant in so many cases.

Check out how we look at things through a new lens here.

Here are a few examples of how focusing on prime cost might be hurting the business.

1) Focusing on a specific prime cost target can cause operators to miss issues with employee workload causing an increase in employee turnover.

2) Focusing on prime cost % could cause an operator to miss a decrease in average guest spend making labor cost targets harder to hit.

3) Focusing on prime cost % could cause an operator to miss a decline in cover count lowering the overall productivity levels of the business.

Let me show you how we look at things like cover count, average spend and workload differently -> Here

ps. If you prefer to connect directly, DM me at Jim Taylor

Now here are a few ways I encourage restaurants to look at things in order to stay ahead.

1. Don't worry so much about food cost % -> Focus more on the variance between your actual food cost, and your theoretical food cost. This is important because unless you sell the exact same number, of the exact same items every week, your food cost % will never be the same.
2. Don't worry about labor % so much -> Instead, pay attention to controlling cover count, employee hours, average wage and average spend. Those 4 factors are what make up revenue and labor $, therefore they make an impact on labor %.

If you follow any of my content, then you have heard me talk about employee workload. Labor cost % can be largely impacted by training and hiring cost, so employee retention is typically a huge opportunity.

Measuring, and managing employee workload can lower stress, anxiety and burnout in a restaurant, and in turn it can dramatically lower turnover... saving thousands of dollars per year.

Lets chat about the employee workload concept... If the NBA, NHL, NFL and MLB all do it, then restaurants probably should too right?

Does your restaurant have a workload issue? Take this quiz!

DM me so we can have a conversation. It might just change your business forever.

At the end of the day, the restaurant business model has changed so much, and is changing so rapidly that unless you properly compartmentalize information like this, it becomes extremely hard to know which direction to head.

But it doesn't have to be ;)

Until next time.

Jim

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Ps. Whenever you are ready here are a few other ways I help people like you every day.

• If you are a restaurant operator or owner who realizes that increased productivity, improved employee workload, and lower turnover are the only responsible ways to succeed in our industry these days... I've got you covered. Book yourself some time here.
• If you are a consultant, or service provider to the restaurant industry and you are wondering how to create opportunity, looking to build your business in 2024, or find it to be lonely as a solo-preneur there is a spot for you right?here and I would love to meet you.
• If you are a restaurant operator who knows that information is the key to success, but you also don't have enough time to sift through all of the reports and data available, let us take care of this for you with specific, automated reports in order to give you a clear idea of where to spend your time. Find out more about done for you, automated reporting here.