One of your most significant expenses will be labor costs, and they can kill it in the industry. Unfortunately, not in a good way, unless you can stay on top of your entire team. Labor costs in the hospitality business can significantly impact the success of your company and your team. Controlling labor costs is crucial if you want to make a profit in your business. This is the number one reason you should invest in online employee time clock software.
Labor costs and keeping track of individual hours has only gotten more tricky. People work from home more often, and it is getting harder to identify progress on a project. Adopting an online employee time clock is one of the most significant ways to reduce labor costs and ensure your company’s success. However, there are other ways you can stay on top of it as well.
Expectations from your team, business, and customers are going up. This can be a lot to manage and can seem overwhelming. You want to have the most hands-on deck but also have it make sense for your business. Here are the best tips we can provide you.
Understand Your Labor Costs Before Starting
If you have never tried to understand labor costs, now is the best time to start. There is a basic formula that you can use to help figure out what your labor costs look like.
- Total sales revenue / Total payroll = Labor cost percentage
You may be wondering how you can find this information. Well, the best place is to go through your daily reports. This is where an online employee time clock can come in really handy. It not only allows your team to clock in, but it can also keep track of sales and daily reports. This can tell you how much profit you are making a day.
Look At The Data And Cut
Once you see the data and understand that the reports help you figure out profit, labor costs, and even your goals, you can start making cuts. It’s hard to know what is essential and what is not. You can’t make random cuts that don’t make sense. That’s why having something like online time clock software can genuinely help you make these decisions.
You can cut back on overtime hours to save extra money, cut shifts in half, or even close the slowest day a week. This is also one of the best ways to view your employee turnover rate. It takes time and money to train people, and it’s expensive. But with employee timesheet software, you can get ahead of any potential issues to help keep your turnover as low as possible.
Use Flex Scheduling To Your Advantage
The best feature about using a cloud-based time clock is that it can help schedule your staff. This can also be one of the best ways to allow flex schedules to occur. There are many advantages to using a flex scheduling system.
Your turnover rate will be lower because your team has more control over their schedules. They can pick up the open shifts that work best for them and swap shifts they can’t do. The best news is using flex scheduling doesn’t cost you anything extra. It also allows you to view busy times and add more or fewer people in. You don’t have to lock anyone into a specific day or shift but rather can schedule employees only when you need them.
Using an online timecard system can help you keep track of labor costs, especially in the hospitality business. You can easily make your team happier and run reports at a moment’s notice to help you track labor costs.
