Why Schedule Labor Properly: Real-life lessons

Two hospitality industry workers taking care of their responsibilities.

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Why schedule labor properly? Because if you don’t, guests and employees leave.

When a restaurant does not properly schedule its labor, service slows down. If the restaurant continues to run understaffed, customer service and employee morale will plummet. This can lead to long-term negative side effects along with a decrease in profits.

Below, we use real examples from the restaurant industry to demonstrate why it’s important to schedule labor properly – or pay the price. 

Why appropriate staffing levels matter

I went to get a late lunch at a local fast food restaurant at about 4:00pm today. I only had a few minutes before I needed to be at my next appointment. I pulled into the drive-thru line behind 3 other customers (all of whom had already ordered) and waited for the attendant.

About 3 minutes went by before the employee inquired about my order.

As soon as I was done ordering (the line of cars did not move at all), a lady in a white car pulled in behind me, blocking any escape. Three more minutes went by before the line in front of me moved forward.

One car. Six minutes. The man directly in front of me moved forward, and turned his car off. And we waited. I cleaned out my car and dumped the trash out. Six more minutes went by, and the car at the second window drove off. The gentleman in front of me turned his car back on, and after yelling at the clerk then moved forward to receive his food from the first window.

I reached the window to pay a clerk for my order, and they immediately after, they sprinted off to help the kitchen. I was given the opportunity to listen to 3 more songs (6 more minutes!) on the radio before food arrived for my compatriot in front of me, and I got to the first drive up window to receive my food.

From my vantage point, I could see the problem. Only 3 or 4 employees in the entire restaurant!

The problem was understaffing

The restaurant had two dozen customers in the front, eating or waiting on their food. One clerk was attending the front counter. Another was standing at my car window, with receipts printed out and placed on napkins (for quick placement into bags). 

The clerk by my car window also appeared to be taking the drive-thru orders. The clerk who took my money was running all of the food lines, making and assembling all of the food, then running back and taking money from drive-thru guests.

Six more minutes went by, and the clerk opened the window and said “I’m sorry about the wait” and shoved my food at me.

Had management appropriately staffed the restaurant for a Sunday afternoon, getting my food might have taken less than a minute. More importantly, they would have served six-times (6x) the number of customers, which would mean six-times (6x) the profit.

In addition to upsetting their guests, the labor shortage caused several other problems within their store, many of which will have long-term negative consequences for the restaurant.

What did the labor shortage cost the restaurant?

Let’s take a look at some of the costs due to a lack of proper labor scheduling:

  1. Unhappy guests. This includes myself and the man in front of me, at a minimum. The guests inside were not very happy either. Will they come back? There is no way to know.
  2. Unhappy employees. There is no doubt that the employees were upset because of the increased workload, pressure, and the guest dissatisfaction. The labor shortage was likely a management decision, which has directly affected the employee morale.
  3. Increased turnover. Most QSR employees have prospective jobs within a few yards.
  4. Reduction in sales. One customer every six minutes? Assuming that this restaurant concept averages $1.00 in net profit per customer, they are making only $10 per hour in profit. How did we calculate their profit? 60 minutes / 6 minutes per customer = 10 customers served. $1 per customer = $10 in profit per hour. By improving their serving time to 1 customer per minute, they could have made $60 per hour!

What could they have done to schedule labor properly?

Here are some of the ways the restaurant could have avoided this lunch rush disaster through proper labor scheduling.

  1. They could have chosen a more skilled cook to work alone as the line cook. A skilled worker may be hundreds of times faster than an un-skilled worker. (TimeForge can assign employees to shifts using skill levels!)
  2. The drive-thru order processing and front-counter clerk duties could have been merged. This would have put a second body in the kitchen, potentially more than doubling their kitchen output. (TimeForge can track labor costs, helping managers decide which job functions can be combined.)
  3. They could have scheduled a fourth employee. This would have increased their labor cost, but the extra worked could be sent home after their sales and labor peak passed. (TimeForge can schedule additional employees with a single click or even help you transfer employees between locations for peak shifts.)
  4. And many other options!

Given the above, it might be time for the management of the store to look for a cost-effective scheduling tool, such as TimeForge!

How long does it take to make your labor schedules? It should take less than 5 minutes! Did you know that TimeForge can streamline and minimize labor costs through effective employee scheduling at your restaurant, bar, club, or business.

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