Do you know how to schedule workers to meet customer demand? This is called labor optimization. It helps businesses staff for the highest profitability and best customer service. Today’s restaurant and retail store managers need to strike a balance. On the one hand they’re considering meeting and exceeding customer expectations. On the other they need to be thinking about employee morale and bottom line results. Labor optimization strikes that balance.
Here are some labor optimization strategies to help you get started.
Start with a few questions:
What are your sales trends?
Is anything happening now that could change these trends?
For example you know there is an increase in customers around the local High School’s Homecoming. You would consider increasing your sales forecast for that period of time.
Know how many staff you need to meet customer demand ahead of time. This helps you ensure you have adequate staff available.
Now, to optimize, check your weekly labor cost percentage and customer to staff ratio.
Ensure you have enough staff on at peak times to avoid long lines of customers who might get frustrated and leave.
Then check the slow times and make sure you haven’t overstaffed. Make sure each day your schedule is set to optimize revenue. Design your schedules to hit your labor cost goals.
Make sure the manager sends the schedule with enough time to make changes so that your goals stay intact. As the week progresses compare your original labor goals & targets with how you are actually tracking. Make adjustments to staffing each day. If staff aren’t adhering to the set schedule plan on having conversations with them to determine the cause and address it.
Why Does Labor Optimization Matter?
Ignoring labor optimization causes several BIG problems including:
Higher than expected wages paid. If you labor cost percentage is too high it can cause your business to run at low profitability or even at a loss. This could be because your managers aren’t holding staff accountable to the schedule. Your forecasting of sales & customer count, or even your estimate of staffing levels may be inaccurate.
Unhappy customers. Waiting, long lines, and dissatisfied customers are likely when understaffing happens. Determine if the root of the problem relates to last minute employee call-outs. More likely Your forecasting of sales & customer count, or even your estimate of staffing levels may be inaccurate.
Flatlined revenues. Failure to hit revenue goals may be due to missed opportunities by staff to meet customer needs. Be sure that proper staffing also means proper training. Good training practices ensure each customer interaction is both profitable for the business and rewarding for the customer.
When done well, labor optimization enables you to:
- See how your scheduling decisions affect profits
- Fill shifts without over or under staffing
- Better manage KPIs
- Better estimate sales
Labor optimization always starts with good data and good forecasts. It’s important to have systems in place that can capture and combine data. A labor optimization system provides all the information you need to run the steps above. The result is you no longer need to build bespoke models in Excel. Scheduling solutions with availability tracking and fill shift features help too.
ZUUS Dynamic Scheduling has a staffing level model to suit your business. Our models show you exactly how many staff you need at all times based on a proprietary sales & customer modeling tool.
ZUUS Workforce is a worldwide resource for labor compliance and labor optimization for the retail, restaurant, hospitality, security, healthcare, and manufacturing industries. Have questions about how we can support you? Contact us today.