Category Archives: managing expenses

Minimum Wage Set to Increase in Los Angeles

Image: Flickr user torbakhopper CC by 2.0

 

There has been a lot of talk across the U.S. about the seemingly ever-changing minimum wage debacle. Just Tuesday, Los Angeles City Council approved the increase of minimum wage to $15 from $9 to be effective by 2020.

Read more here: Los Angeles Raises Minimum Wage to $15

Tips to Help You Combat Rising Beef Prices

Beef prices have hit an all-time high with choice-grade beef priced at more than $2.11 per pound.

Many factors have contributed to the rise of beef prices over the last several years; the rising costs of both cattle feed and fuel in 2008 caused many farmers to cut the size of their herds, and in the following two years, the economic recession lowered demand while food prices remained flat.  As the nation’s economy began to recover in 2011, major droughts raised the price…read on:

Holy Cow! Tips to Combat Rising Beef Prices

How to combat rising beef prices
Beef prices are on the rise

How is your restaurant coping with increasing food prices?

The meals you eat at your favorite restaurants may be costing you more these days. One of the largest droughts since the 1950′s is hitting our nation’s most valuable crops like corn and soybeans, hard. So what’s a restaurant to do, then?

 

Read more: restaurant supply chain management

Employee Theft at Restaurants

Part one of Three.
A commentary by Dean Small, Managing Partner of Synergy Restaurant Consultants.
One recent study puts the financial loss to retail companies in stolen merchandise at $52 billion. National Cash Systems completed research last year showing that the average restaurant employee steals $220 per year in cash and products.
During the last few years, there have been growing concerns about the need for continued careful screening of prospective employees to ensure a safe work environment with honest, responsible and trustworthy employees. Many clients are dissatisfied with current assessment tools that purport to assess counter-productive behaviors. Clearly, this is a time when employees and customers need and want to feel safe and secure in the workplace. Bottom line: it falls to you to make sure of your business safety and honesty in the marketplace.
In this first of a series, let’s focus on daily activities. There is a pattern, a rhythm in your operations. When you detect changes in that tempo, start looking for unusual changes in your employee behaviors.
Signals From Employee Activities:
1. Are there secretive conversations among employees or phone conversations that stop abruptly when you approach?. Is there any one engaged in sending or receiving cryptic messages?
2. Is there excessive loitering of around your business of off duty employees, ex-employees or their friends.?
3. Do you find frequent “shortcuts” in procedures to expedite deliveries? Is there rapid checking in of some deliveries while others take much longer for no legitimate reason?
4. Do employees bring in large shopping bags or wearing unusually loose clothing to work regularly?
5. Do certain employees attempt to distract or hold the attention of a supervisor for no good reason while another employee is in the work area or signaling by hand gestures, whistling, etc. when a supervisor approaches?
6. Are there repeated violations of such security regulations as use of unauthorized exits or keeping personal packages in the work area? Do you keep finding an employee in an area he/she has no legitimate business in?
7. Do you discover the signing of another employee’s name or signing illegibly on invoices or packing sheets?
8. Are there employees habitually returning to the work area after others have left to retrieve something left behind?
9. Do you receive complaints by employees or customers that personal effects are being lost or stolen?
10. Are there frequent cash shortages on the same employee’s shift? Is there an unusual eagerness to “make up” the shortages rather than relinquish cash handling responsibilities?
11. Do you discover frequent cash overages on the same employee’s shift? This may indicate that an employee is stealing cash at the register but not “light ringing” sales enough to totally cover it.
12. Do you find an unusually high number of “no sale” transactions registered on any one shift?
13. Are there excessive undocumented voids on any one shift or voids left unrecorded until the end of an employee’s shift?
14. Do you see numerous receipt slips held by an employee until the end of a shift or notes found in the trash indicating that the employee was keeping a secret count of transactions?
15. Is there an employee who insists on ringing up his/her own employee meal after turning over cash handling responsibilities to another employee?
16. Do employees make excuses for theft? Employees who steal, rather than believing theft is wrong, may condone the acts of dishonest employees as, “It’s no big deal. It was only a few bucks.”
17. Employees who violate restaurant policies and procedures should be watched. 18. Are there overzealous work habits? Employees who work through their lunch breaks, seldom take a breather and never ask for time off may be running a game with the cash register. Also, employees who refuse to go on vacation may be afraid that their substitute will discover their dishonesty.
Yes, this all takes extra time and effort on your part. Granted, you trust your people. However, with a high cash and credit card number transaction business, the temptation may just be too great for many. Remember, it is estimated that 95% of all businesses experience some employee theft. Halting that drain will help your bottom line. Ignoring it will only cause it to expand and hurt you and your clients.
In our next edition, we will share additional signals regarding employee theft.
Dean Small

Everything old is new again.

I pride myself in obtaining the very latest in up to date information on foodservice trends and innovations. Today there was an article about a London restaurant that came up with a revolutionary idea for these hard economic times.

Their approach was simple: Suggest prices, but let the customer pay what they want for the meal. This establishes trust in the customer, provides feedback on the quality of food and service, builds reputation and customer base…and the list goes on. According to the restaurant, very few people actually try to ‘take advantage’ of the eatery and claim a free meal.

What a great, new, cutting edge idea…except for the fact that it was already a hugely popular concept here in Southern California…over 75 years ago.

Yes, back during the REAL Great Depression of the 1930s, a fellow named Clifford Clinton started a diner called Cliftons in Los Angeles. He was a third generation foodservice man, having grown up in his father’s cafeteria in San Francisco. His grandfather began the family tradition at a train station in San Bernardino, California in 1888.

Let me mention one prominent factor here: The family were devout Christians who created their diners and then went off as missionaries for the Salvation Army in China. Their successful restaurants kept them in enough money to continue their charity work.

Knowing few people could afford to eat out in the depths of the Great Depression in 1931, he made a pledge to the public that they could pay whatever they wanted or could afford. He vowed that none would go away hungry. Suggested prices were on the menu, but people could pay little or even nothing if they were not completely satisfied with the quality of the food. In our jaded day one would think the conniving public would rob him blind. However, people are generally good and honest. And they appreciate someone whose heart is truly set for the good of all. For every 3,000 customers served, only about 12 would scofflaw and demand a free meal.

Customers became “guests” and none were ever turned away hungry, even though they had no money. During one 90-day period, 10,000 ate free before Clifford could open an emergency “Penny Cafeteria” a few blocks away to feed, for pennies, the two million “guests” who came during the next two years. They survived and thrived via creative means. But that is another story for another time.
Cliftons in downtown Los Angeles is still operating…and thriving massively — using all floors of the three story building for the crowds of people who come to eat there. After 113 years and four generations. You may scoff at the approach, but the success is undeniable! And no, very few are down and out types.

Innovative approaches and solutions are the hallmark of successful businesses. Synergy Restaurant Consultants provides those long term and creative ideas.

Manage the Pennies and the Dollars will Follow

It should be no surprise even when considering the state of today’s economy, that 100 pennies still equal a dollar, but you might be surprised how overlooked this can be within the walls of restaurants. Everything from the oil you use in your fryers to the paper wrapped straws you hand out by the handfuls cost various quantities of pennies. Thoroughly reviewing your inventory and usage of these and all similar items could drastically benefit your Cost of Goods. This practice of Managing Pennies” can also spill into non product related areas of your operation.

One example of “Managing Pennies” in areas other than groceries, would be with your labor. Have you checked the employee break practices for your state? You may not be required to provide paid meal breaks or maybe you are; either way, it’s worth reviewing to insure that you are compliant with local laws. Continuing on the subject of labor, staggering employee clock in and out times is another underutilized option among operators. It’s likely that most restaurants “cut” employees early to curtail expenses, in fact I believe that practice has been in place since the first server ever carried a plate. But, how many of you stagger your schedule in the kitchen area? It may not in fact be necessary for all three of your lunch cooks to arrive at the same time, or for the stewards to be there two hours before lunch service. The solutions are as unique as the issues, but there are some proven solutions to these and many other problems.

The best suggestion is for you to tap your resources for solutions to these issues. Make it a contest for your staff to suggest ways to save pennies. I was involved with a project where this was encouraged, and over $8,300.00 was saved by a bartender who suggested the house salads served with every meal be made in advance rather than producing them to order. As a result, the bus person who’s job it was to make these salads, could now focus on the dining room better, and save a little labor in the mean time.

This was a real win-win opportunity, and they aren’t all so immediately beneficial, but your staff is in the trenches and they really know your business front and back. If you don’t have the resources internally, you should contact a professional. Similar to your house plumbing or your car being serviced, there are professionals in this field who can help you and your staff operate in a more efficient manor. Either path you chose to travel, keep in mind that everything, and I mean everything costs something. Maybe it’s just pennies a piece you could save, but they do add up.

Mark Ladisky

Restaurant Consultant