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Turning the Turnover Tide in the Food Service Business
September 5, 2017 by Richard Farrell Jr | News
Turning the turnover tide
Increased revenue and profits make every business owner happy, but there’s one number that food service businesses wish would decrease: staff turnover. According to the National Restaurant Association, the 2016 hospitality staff turnover rate was more than 70 percent. That means the average business lost seven out of every 10 employees over the course of 2016.
Some loss can be attributed to the fact that the restaurant industry employs a high proportion of teenagers and college students whose comings and goings are dictated by semesters, grades and extracurricular activities. But employees who make their regular living in the industry are lost in turnover, too.
Even with some unmanageable variables when it comes to staffing, there are ways that hospitality business owners and managers can reduce turnover. Malachy Parts & Service want to be a strong resource for our customers and we recognize that you often need more than equipment repair. In this three-part series, we offer a different type service and we hope it will help you reduce employee turnover.
Like Julie Andrews told the Von Trapp children, “let’s start at the very beginning.” What kind of workplace culture do you have? If you’re answer is, “Who cares? I pay my employees and that’s enough,” this blog article might not be for you. But if you understand that employee satisfaction contributes to your bottom line, then a workplace culture audit could be a valuable exercise.
Using some basic math skills and accessing employee data, count how many employees you had on January 1 and December 31 of the most recent full year. Add those numbers together and divide by two. For example, say you had 16 employees on January first and 14 on December 31. 16+14 = 30; 30/2 = 15. Now count how many employees quit or were fired over that year (say it’s 9). Divide 9 by 15 and the number is .6 or 60 percent. That means your turnover rate for the year audited was 60 percent. Lower than the national average, but not good.
The next audit step is to find out what other hospitality business wages are. Maybe you’re a caterer and you’re paying your staff the going rate for catering employees. But what are fast food restaurants, hospitals and fine dining establishments paying their staff? It’s important to know because these are the businesses that want your employees.
These days, it’s not just pay that entices employees to jump ship. Are your competitors offering benefits (health insurance, vacation time, incentives for taking on extra shifts)? How about training and probationary period mentoring? Employees who feel they’re improving their skills are more loyal, especially if improved skills could lead to career advancement within your business.
Finally, are your employees encouraged to communicate? You don’t necessarily have to spend big money on a consultant for good ideas. This is the age of innovation and your dishwasher could have an idea that would streamline a kitchen process. Is there a process in place to encourage, communicate and reward innovative thinking?
Change can be good, especially if you can change your business’s turnover rate for the better. Gather information, determine if there’s room for improvement and, one step at a time, work toward an improved workplace culture.
In the next blog article of this series, we’ll offer tips for writing a better help wanted posting along with how to get the word out.