Monthly Archives: April 2014

How to Develop a Management Plan in Your Restaurant – Part 2

Posted on by
Reply

By David Scott Peters

www.therestaurantexpert.com

In my last blog post I explained what a management plan is and the benefits of developing one in your restaurant.  For this blog post I want to give you the tools you need to create your restaurant’s management plan.

What’s next?

First you have to evaluate your restaurant.

Your management plan is divided into sections that correspond with many of the most important areas of your operation. Each section includes a personal evaluation of your restaurant’s current approach to running a profitable and easy-to-operate business. Use the following questions to create your own evaluations for each of the key areas of your restaurant.

Financial Plan

Using a scale of 1 to 5, 1 being strongly AGREE and 5 being strongly DISAGREE, rate your restaurant on the following:

  1. Based on my restaurant’s current efficiencies, good or bad, I know my breakeven point ­­­____
  2. My restaurant is on an accrual accounting system ­­­____
  3. I supply my accountant, or whoever prepares my books, my ending inventories within five days of the end of every month ­­­____
  4. My profit and loss statement is currently set up in such a way that cost of goods sold and labor are broken out into easy to read sections before all other expenses ­­­____
  5. My restaurant uses weekly and monthly cash flow projections to help run the restaurant efficiently and pay its bills ­­­____
  6. My restaurant has a detailed monthly budget that everyone in the management team understands and is expected to achieve ­­­____
  7. My restaurant knows its dollars per square foot and or dollars per seat ­­­____

Cost of Goods Sold

Using the same scale above, rate your restaurant on the following:

  1. My restaurant uses a budget variance report so management can clearly see how they are managing our controllable expenses ­­­____
  2. My restaurant does a monthly food and liquor inventory ­­­____
  3. For even better controls, my restaurant does a weekly and/or a daily food and liquor inventory ­­­____
  4. My restaurant calculates its cost of goods sold by category at least monthly ­­­____
  5. My restaurant manages its inventory turns to minimize the amount of product sitting on our shelves at any given time and keep our cash in the bank ­­­____
  6. My restaurant keeps an eye on our change in inventory to see if we are ordering properly ­­­____
  7. All of our recipes have a completed recipe costing card filled out and updated on at least a quarterly basis ­­­____
  8. Utilizing our POS system, we know our restaurant’s ideal food and pour cost, and we measure our performance against these numbers ­­­____
  9. In my restaurant we use tools such as a key item report and waste sheet to control our food costs ­­­____
  10. My restaurant uses a purchase allotment system to make sure we are ordering correctly ­­­____

Food Systems

Using the scale above, rate your restaurant on the following:

  1. My restaurant uses par levels for products it purchases ­­­____
  2. My restaurant utilizes a purchase order form to ensure ordering, receiving and costs are done accurately ­­­____
  3. My restaurant only allows management or line employees who have been sufficiently trained on receiving procedures to check in orders ­­­____
  4. My restaurant uses a daily prep list to ensure we prep the appropriate food levels to run successfully each day based on the business we expect ­­­____

Labor Systems

Using the scale above, rate your restaurant on the following:

  1. My restaurant uses a master schedule for all departments so that any manager can write an accurate schedule even if it’s not their own department ­­­____
  2. Every manager knows how many FTEs are needed by department and hire accordingly ­­­____
  3. Schedules are written based on forecasted sales for the week by day and shift ­­­____
  4. Before schedules are done for the next week, management is given projected sales, how much money they can spend and how many employees they need to fill their shifts ­­­____
  5. My restaurant tracks labor cost daily ­­­____
  6. My restaurant trains all managers to write a schedule the same way all of the time ­­­____

Running the Restaurant

Using the scale above, rate your restaurant on the following:

  1. My restaurant uses AM and PM manager checklists on a daily basis ­­­____
  2. My restaurant has a pre-shift meeting 15 minutes before every shift for both front of house and back of house staff ­­­____
  3. My restaurant uses a manager’s log on a daily basis to communicate ­­­____
  4. My restaurant has clearly defined house policies ­­­____
  5. My restaurant trains all managers to follow a step-by-step systems for checking-out ALL line positions ­­­____
  6. All of my managers have been trained in the proper use of the I-9 Employment Eligibility Verification Form ­­­____
  7. My restaurant has a HACCP Plan in place ­­­____
  8. My restaurant has a tip reporting system in place to comply with the yearly filing of our 8027 Tip Report to the IRS ­­­____
  9. My restaurant complies with the OSHA posting requirements ­­­____

Finally

To develop your management plan, after you evaluate each section, start putting your plan on paper in the form of both short-term and long-term goals.

When you are finished with this exercise, you will have put together your complete management plan for success.

David Scott Peters TheRestaurantExpert (1)David Scott Peters is a restaurant expert, speaker, coach and trainer for independent restaurant owners. He is the developer of SMART Systems Pro, an online restaurant management software program helping the independent restaurant owner remain competitive and profitable in an industry boxed in by the big chain restaurants. He is best known as the SMART Systems guy who can walk into any restaurant and find $10,000 in undiscovered cash before he hits the back door… Guaranteed! Learn more at www.TheRestaurantExpert.com.

 

How to Develop a Management Plan in Your Restaurant – Part 1

Posted on by
1

By David Scott Peters

www.therestaurantexpert.com

First, what is a management plan?

A management plan is your written strategy for how to get your restaurant to where you want it.

New ideas have very little value unless they are put into action. This management plan is a tool that translates ideas (I should or I’ll try to) into action (I am). This helps solidify your commitment to turning your restaurant into a profitable and smooth running operation. It also provides the direction your management team needs to do their jobs to your expectations.

In developing your plan for improving your restaurant operation, remember these helpful tips:

  • Study every aspect of what you want to implement – does it fit with your management style and goals.
  • Believe in your plan – have confidence in your ability to make it happen and work.
  • Teach, involve and delegate to your team. You can’t do it alone and you need their commitment, buy-in and most importantly their support.
  • Work hard to make it happen! See rapid results!

Benefits of a management plan

A management plan produces:

  • Clearly defined goals to achieve
  • Knowledge of achieved success
  • Clear communications
  • Organized thoughts and ideas, identifying/rectifying omissions
  • Systems for realizing short and long-term goals
  • Less stress
  • Increased bottom-line
  • Increased cash flow
  • Improved employee morale
  • Business growth

You should have several objectives in mind when developing your management plan, but your ultimate goal is to build a more profitable business (a virtual cash machine), work less, have less stress, and have a real personal and family life.

Just remember, any business is only as good as its people believe it is!

In the next blog post, I’ll provide you with the questions you need to ask of yourself and your restaurant to be able to put your management plan together.

David Scott Peters TheRestaurantExpert (1)David Scott Peters is a restaurant expert, speaker, coach and trainer for independent restaurant owners. He is the developer of SMART Systems Pro, an online restaurant management software program helping the independent restaurant owner remain competitive and profitable in an industry boxed in by the big chain restaurants. He is best known as the SMART Systems guy who can walk into any restaurant and find $10,000 in undiscovered cash before he hits the back door… Guaranteed! Learn more at www.TheRestaurantExpert.com.

 

9 Things to Offer to Attract Good Restaurant Employees

Posted on by
2

By David Scott Peters

www.therestaurantexpert.com

One of the key lessons I’ve learned over my years in the restaurant business is that not everyone works for you just for money. Money is a factor, but people are looking for much more.

So how do you provide the “much more?”

Many years ago now, restaurant coach Fred Langley best articulated what you have to strive for if you want to attract and keep the very best people on your team. He said you have to become the “Employer of Choice.” So what does that mean?

Without going into the whole explanation behind clinical psychologist Frederick Herzberg’s, “Herzberg’s Motivation-Hygiene Theory,” let’s cover the key factors beyond money that he says motivate people to work and work hard:

  1. Supervision – Make sure you have a management team that coaches employees to success, understands what makes each employee unique and is able to push their buttons to get the best of your people.
  2. Fair compensation – While you don’t have to be at the top of your market’s pay scale, you certainly cannot be at the bottom.
  3. Good working conditions – Make sure you have a clean restaurant, that you have all the right equipment and tools for your employees to do their jobs, and make safety a priority.
  4. Interpersonal relationships – Avoid at all costs having a management team that thinks all of their people are stupid and treats them like crap. Remember, this is a people business and it all starts with your internal customers.
  5. Recognition – Look for people doing things right in your restaurant and give them kudos when you see it. It’s easy to find people doing something wrong. When you focus on the good things, you create a positive work environment where people want to continue to please you vs. just waiting for the scolding.
  6. Responsibility – Sometimes you have great employees who have been with you for many years who NEVER want to be a part of the management team. Yet, they are willing to do more. Look to teach and assign them tasks that make the company better and get more done. Allow them to be a more valued asset on the team and they will be motivated to do more.
  7. Achievement – With responsibility there are often measurable results. When your team sees how what they do has a direct positive impact on the business, they get a real sense of achievement, which makes them want more.
  8. Advancement – Remember money is not the only thing people are looking for when they join your management team. Many want to know that there is a clear path to promotion and advancement in your company. Whether it’s moving up the management ladder, moving into the next better paying line position or gaining the skills that make them more valuable in their career, there needs to be a clear path to advancement that’s based on doing a good job, not who you are sucking up to.
  9. Work itself – I remember my first jobs in the restaurant business were washing dishes, and I hated it. It felt thankless to me, and I was probably not mature enough to want to work that hard as a young teen. Moving up in my career, I’ve always kept that in the back of my mind when managing employees. You need to make sure the job, no matter what level in your organization, is rewarding.

High employee turnover is expensive and disruptive to any business. With training and systems in place, you start with employees who know what their job is and what is expected of them. But to keep them long term, you have to be an “employer of choice.” If you properly address the majority of these factors, you’ll be one!

David Scott Peters TheRestaurantExpert (1)David Scott Peters is a restaurant expert, speaker, coach and trainer for independent restaurant owners. He is the developer of SMART Systems Pro, an online restaurant management software program helping the independent restaurant owner remain competitive and profitable in an industry boxed in by the big chain restaurants. He is best known as the SMART Systems guy who can walk into any restaurant and find $10,000 in undiscovered cash before he hits the back door… Guaranteed! Learn more at www.TheRestaurantExpert.com.

5 Things You Can Do Now to Cut Food Costs

Posted on by
Reply

By David Scott Peters

www.therestaurantexpert.com

I originally wrote this article in the fall 2008 when the economy was really starting to hit my members where it hurt. And many of my members, because they have put systems such as these in place, weathered the 2008 recession much better than they expected. It’s all about operating at the lowest cost possible to maximize every dollar that comes through the door – in good times and in bad times.

So here are five easy-to-implement systems that will help you weather any economic storm – from the economy to slow tourist traffic – and also help your business in the long run.

  1. Raise prices. If you’re feeling the pinch, you could have no choice. A mistake would be to start ordering lesser quality substitutions, such as catfish instead of grouper. People who eat in your restaurant on a regular basis have come to expect a certain level of quality. If you start offering lesser quality ingredients, it will be noticed, and you’ll pay the price in the long run. And you don’t have to raise prices by much to have an impact, as long as you’re implementing changes in other areas.
  2. Purchase smarter. This is a two-parter.
    • First, order a descending dollar report. You can get this from your vendor. It shows what you spent the most money on down to the least amount of money. This isn’t necessarily in volume, but in price per item. It’s not that I ordered 10 cases, it’s that I spent $1,000 — which could have been 1 case. Based on these figures, you can try to find like or better products at cheaper prices, which can have a huge impact on your business. You can take something you usually spend $3,000 a month on and get it down to $2500. Attack the next thing, say it’s $2,000 a month on down to $1500 and so on. Work your way down the report, cutting dollars off each item you order until you get to the bottom and can’t cut any more. You don’t want to sacrifice your quality, so it won’t work on every item, but this can be huge. I’ve had members cut their spending by 5, 7, even 10 percent.
    • Second, get a prime vendor agreement. Rather than order small amounts of product from a large number of food distributors, you’re better off to order most, if not all, of your product from one distributor. Yes, you might be getting a killer deal on cheese from one vendor, but in the meantime, you’re getting railed in your janitorial and paper items from another. Cherry picking won’t get you far these days. It’s no longer to your advantage to purchase this way. A prime vendor agreement will make a huge impact on your bottom line, cutting percentage points off your operations costs, guaranteed.
  3. Recipe costing cards. Create a recipe costing card for every item on your menu – including your bar drinks. Include everything down to the single piece of lettuce. If you’re a quick service restaurant, you can include the cost of the to-go packaging. Making these cards and training everyone to them eliminates waste and over-portioning. Plus it provides a great training tool.
  4. Menu engineering. Sit down and take a long hard look at your menu. If you have them at your disposal, run a few reports through your POS system. Look at your item-by-item sales mix report and your key item report. Plot each item on a graph, with the number sold on the y axis and the profits made in dollars on the x axis. These will tell you what items are ordered most often and how much they cost you to make. Combine your recipe costing cards with your POS reports, and you’ll see the dogs on your menu. The dogs are the ones that don’t sell, or the ones that do sell, but cost you money to sell. You don’t want dogs. You want stars. You want popular, high-profit menu items. Get rid of the dogs, highlight the stars. Encourage people to purchase the higher priced items on your menu.
  5. Waste sheets. All causes for waste are avoidable and are a direct result of a lack of management and training. Waste includes a burned steak, food that spoiled because it was buried in the back of the walk-in and wasn’t rotated properly, and serving portions that are too large (this ties in to the importance of recipe costing cards). The waste sheet includes what the item was, that it was wasted, why it was wasted and how much that cost. Some people also like to put how much money it would have been worth if you sold it. Keep track of what gets wasted, and you’ll see a drop in waste. It’s an automatic drop in your food cost.

Lean, mean, fighting machine

Whether we’re in a recession or not, these things will impact your bottom line. If you’re already doing these things, I think there are probably places you can still trim. Go back and look at the areas where you can make a difference.

And just imagine. These five suggestions focus purely on cost of goods sold. That’s just one area within your restaurant. There are margins all over your restaurant where you can have an impact.

David Scott Peters TheRestaurantExpert (1)

David Scott Peters is a restaurant expert, speaker, coach and trainer for independent restaurant owners. He is the developer of SMART Systems Pro, an online restaurant management software program helping the independent restaurant owner remain competitive and profitable in an industry boxed in by the big chain restaurants. He is best known as the SMART Systems guy who can walk into any restaurant and find $10,000 in undiscovered cash before he hits the back door… Guaranteed! Learn more at www.TheRestaurantExpert.com.

 

 

 

13 Steps to a Fool-Proof Schedule

Posted on by
Reply

By David Scott Peters

www.therestaurantexpert.com

Here are 13 steps I developed to write a fool-proof schedule to make it fun and effective. With this system you and your managers can write great schedules that satisfy the needs of the business and of the staff.

1. Staff Order
When you list your staff members on the schedule, list them in the following order:
A. Lead server
B. Server trainer
C. Seniority

Put your key people — such as your leads and trainers — first as a sign of respect and responsibility. Then list your servers by seniority. However, this order has nothing to do with who gets the best shifts.

2. The Busiest Times Require Your Best People
Schedule your strongest people for the busiest times.

3. Offer Opportunities to Make Money to Everyone
Make sure your new, less senior staff get at least one money-making shift on the schedule each week to keep them happy and to give them an opportunity to learn.

4. Everyone Should Know the Day Shift
Have all staff work at least one day shift. Doing this opens up those money-making shifts for the newer members of the team and allows for a stronger lunch shift for stronger sales and a better customer experience.

5. The Backward Scheduling Priority
A common mistake a manager makes when scheduling is to start writing a schedule on Monday and finishing with Sunday. From here on, number your days, 1 being the busiest to 7 being the slowest. Then start scheduling backward, from 1 to 7 to get your strongest people in your busiest shifts.

6. Give Them Personal Time
Schedule two days off in a row whenever possible.

7. Close/Opens, the Quickest Way to Mediocrity
Stay away from scheduling close/opens, when a staff member closes the night before and opens the next morning. It’s important for morale and accountability.

8. What to Do When You Are Over Staffed
If you have more staff available than shifts to fill, give shifts to your full-timers first.

9. Staff Up, Not Down
Always have two more full time equivalents (FTEs) than you need. An FTE is whatever number of people it takes to equal one full-time person.

10. Remember a Request Is a Request
Scheduling requests are just that: requests. The needs of the business must come first. Make it clear to your staff you reserve the right to say no. But try to always grant those requests and fill the hole with your extra FTE.

11. Management Is Required
Any schedule changes must be initialed by a manager to avoid overtime and to make sure shifts are covered properly.

12. Post Quickly and Consistently
Accept scheduling requests until Tuesday night, write the schedule on Wednesday or Thursday, and post it by Thursday at 4 p.m. Make few exceptions. And in the case of holidays, plan ahead.

13. Use a Scheduling Key
When filling out a schedule, use a staffing key that includes every employee and their schedule requirements. Place an “X” on the days people cannot work, place an “R” in the days people have requested not to work and place a “V” in the days people have requested off for vacation. Then start scheduling shifts.

Following these 13 steps will save you time and ease your stress. It will also keep employee morale high and productivity up.

David Scott Peters TheRestaurantExpert (1)David Scott Peters is a restaurant expert, speaker, coach and trainer for independent restaurant owners. He is the developer of SMART Systems Pro, an online restaurant management software program helping the independent restaurant owner remain competitive and profitable in an industry boxed in by the big chain restaurants. He is best known as the SMART Systems guy who can walk into any restaurant and find $10,000 in undiscovered cash before he hits the back door… Guaranteed! Learn more at www.TheRestaurantExpert.com.