by Matt Sweetman | Dec 4, 2024 | Sales Figures
Inflation beating like-for-like sales growth for hospitality industry, but profit under pressure.
The latest data from S4labour reveals that sales were up 8.5% in November 2024, compared to the same month last year. London saw growth of 9.9% year-on-year, whilst the sites outside the capital saw 8.1% like for like boost.
“Operators have a short window…before the effects of the budget hit home”
S4labour’s Chief Growth Officer, Richard Hartley, commented: “These figures show many great operators are meeting challenging consumer conditions, but potentially hide the pressures on underlying profitability caused by wider macro economic headwinds. Operators have a short window now to capitalise on improved sales and get to grips with the main variable costs before the effects of the budget hit home.”
by Abby Henson | Nov 11, 2024 | Sales Figures
Hospitality sales were up 1.7% in October compared to the same month last year, the latest report from S4labour reveals.
In London, like-for-like sales rose by 7.4%. This growth was largely driven by a 12.6% year-on-year increase in food sales.
Outside of London, like-for-like sales remained flat, showing a 0% change when compared to the same period last year.
However, there were notable differences between different site categories across the country. Dry-led sites (those focused on food offerings rather than alcohol) performed better, with a 4.1% increase in sales, reflecting a growing preference for food-led venues. In contrast, wet-led sites saw a slight decline, with sales down by 2.9%.
Chief Growth Officer at S4labour, Richard Hartley, commented: “This mediocre uptick in like-for-likes demonstrates the challenge of seeing any real-terms growth that operators, particular in wet-led businesses, are facing. With the proposed increases to employment costs, as well as the slash to business rates relief announced in the Autumn budget, businesses will, once again, be looking to festive trade to help towards combatting further upcoming cost-burdens.”
by Alastair Scott | Oct 28, 2024 | Thought Leadership
One of my team members recently asked for an article I wrote a few years ago on labour and sales growth. Unfortunately, I can’t seem to find it, which means it’s time for a new—and hopefully better—version about the true cost of stress.
The importance of aligning supply with demand in our industry cannot be overstated. It’s one of the most challenging tasks we face, as it directly affects both customer experience and profitability. At its core, it’s about getting the right number of team members at the right time, which sounds simple but can be difficult to execute consistently. This is where two key principles should always guide our decision-making when planning labour: avoiding overstaffing and managing stress effectively.
First, overstaffing is a bigger threat to service quality than understaffing—something I find myself repeating more and more. As the saying goes, “If you want something done, give it to a busy person.” This saying holds particularly true in the hospitality industry, where staff performance tends to drop when they aren’t busy. Overstaffing not only increases costs but also often leads to worse service. When staff have too little to do, service is slow and lacks energy, and your team will often lose focus. This not only affects guest satisfaction but also wastes resources. If you need a compelling reason to avoid adding extra team members unnecessarily, this is it. Overstaffing doesn’t just cost more—it can degrade service, which is the opposite of what we aim for.
On the flip side, the more obvious breakdown in service and sales happens when you don’t have enough staff. This is where managers and assistant managers are most likely to raise concerns, as it leads to stress for the team—a feeling we’re all familiar with and something we can actually measure. Stress on the floor, whether in the kitchen or front of house, is a real performance detractor, and it’s important that we understand its dynamics. We divide stressful periods into two categories: short stress and sustained stress.
Short stress is when understaffing happens for a brief period, maybe an hour, but before and after that window, the team can still deliver the required service. This often happens at peak times—around 1 p.m. for lunch and 7:30 p.m. for dinner. During these short bursts, the team can step up a gear, temporarily delaying tasks like resetting tables or washing glasses. These short, intense periods of stress are manageable and, in many cases, preferable to overstaffing, as they don’t usually last long enough to lead to poor service. In fact, some level of short stress can actually enhance team performance, allowing employees to focus and work efficiently without the need for additional staff during the less busy portions of the shift.
Sustained stress, on the other hand, is an entirely different thing. When the pressure lasts for two hours or more, delayed tasks start to pile up, and the shift unravels into chaos. The team can’t maintain that higher gear for long, and as a result, service quality suffers. Orders are delayed, bills don’t go out, and guests aren’t offered second drinks. Dwell times increase, leading to more complaints. Worst of all, guests may tip less, complain directly, or simply not return.
But how do we measure the true cost of stress?
Wasted labour is relatively easy to quantify—most businesses can save around 10% of their labour costs by cutting slack. Our experience is that reducing stress can result in about a 6% uplift in sales, depending on how bad things were before. That can translate into a massive 40% profit increase, assuming a few factors I won’t dive into here.
So, what’s holding us back? Oddly, many managers deny the sales potential from reducing stress. The two biases I hear most often are “we cope” and “no one complained.” But these are just self-soothing lies. Being honest about the opportunity requires breaking old habits—and sometimes a nudge from someone with a more objective view.
Understanding the true cost of sustained stress—chaos, poor guest experiences, missed sales opportunities, and unhappy staff—is crucial for driving sales growth. Balancing labour and service levels might require a slight increase in spending, but the returns—more tips, fewer complaints, repeat customers, higher average spend per cover, and happier teams—far outweigh the cost.
by Alastair Scott | Oct 14, 2024 | Thought Leadership
I always believed it took just four weeks to change a habit, but it turns out I was wrong. A few weeks ago, we had a training session in our office on the “lies we tell ourselves”, otherwise known as personal bias, led by the brilliant Dulcie Swanston. She pointed out that, on average, it actually takes 66 days to solidify a habit. She also made the intriguing observation that the more intelligent you are, the stronger your personal bias tends to be—which makes it hard to argue! So, we’re either unintelligent and unbiased, or smart and biased. What a choice!
Habits are arguably the most important factor in hospitality. Our routines form the backbone of everything we do. When these habits are well-formed, new team members adopt them effortlessly, almost without thinking. It’s a great place to be when your habits are strong, but a terrible situation when they aren’t.
To change a habit, it takes around 10 weeks—and even longer for part-time staff. This requires significant effort, but it’s necessary. The key lesson from the 66-day rule is that trying to implement too many changes at once often leads to failure. Instead, we need to slow down, focus on fewer changes, and make sure they stick.
I also follow the rule of three. Make three changes, implement them fully, and then move on to the next set of three. By dividing the year into terms, you have three chances to implement three new habits each term, resulting in nine new habits a year.
Nine new habits will make a massive difference. If I were to pick nine for the industry based on my experience, I would pick:
1 – Smiling: The first article I ever wrote was about the power of a smile, and it still holds the top spot for our teams. A genuine smile creates an immediate connection with guests, sets the tone for positive interactions, and reinforces the warm, welcoming atmosphere we strive for in hospitality.
2 – Hellos and Goodbyes: There’s nothing worse than being ignored when you arrive or leave. A warm, enthusiastic greeting sets a positive tone for the guest’s experience from the start, while a cheerful goodbye leaves a lasting impression.
3 – “OK”: I can’t stand this word. We don’t aim to deliver an “OK” experience; we want to offer a great one. So why do we ask guests if “everything is OK”? It’s lazy and disengaged, like a quick pass-by. Instead, we should be more thoughtful—ask if they’re enjoying their meal or if they’d like another glass of wine. That’s real service.
4 – Full out, full in: The number of team members I see drop off something and then pass by lots of empty plates, glasses and customers on the way back is immeasurable. Think of the efficiency if we got it right.
5 – Fact Finding: We all remember those wonderful experiences where someone showed genuine interest in us. Simple questions like, “are you celebrating something special?” or “how far have you travelled?” can spark connections. I don’t care what the questions are; just ask something!
6 – Ask them before they have to ask you: When a drink is empty, or nearly empty, it is pretty obvious. Time to make the suggested sell. Can I get you another? Obviously, “are you OK for drinks?” is banned!
7 – 4-foot rule: This is a rule Walmart certainly used to have. If you are within 4 feet, say hello and smile, even if you are on your way elsewhere. The guest will understand and will be grateful for the contact.
8 – Eye contact: In the modern world, eye contact is even more essential. It creates a connection that makes such a difference. I once asked the bar team to tell each other the colour of the customer’s eyes.
9 – Restaurant eyes: This is perhaps the hardest, but there is nothing worse than trying to get someone’s attention and they never look at you. Scanning your section is a part of the job.
If we could make these nine service habits stick, imagine how much better, and busier we would be!
by Abby Henson | Oct 10, 2024 | Blogs
Starting teams strong and ensuring they stay engaged is key to delivering the perfect shift. Productivity is boosted, team communication is improved, and most importantly, customers get a top-notch service day in, day out. The result? Benchmark data shows a 6.2% increase in sales per cover, making each shift more profitable for your business. Our Shift Success module, which includes Shift Allocation and Shift Briefing functionalities, helps your team stay connected, informed, and productive throughout every shift. These tools are built by operators, for operators, meaning they provide more than just a data-driven approach—they communicate clear roles and responsibilities as well as shift-specific briefs to ensure smooth service delivery, even during quieter periods. Let’s dive into how these features can revolutionise your operations and create a balance between efficiency and a people-first mindset.
- Shift Allocation: Clear Roles for Greater Productivity
One of the most frustrating experiences for employees is starting a shift without clear direction. Ambiguity around who is responsible for what can lead to confusion, inefficiency, and even reduced service quality. This is where Shift Allocation shines. It removes uncertainty by assigning staff to specific roles, areas, and tasks before their shift even begins. For an Ops Director managing multiple venues, this functionality is a game-changer. Shift Allocation automatically informs each employee of their role—whether they are working on the bar, waiting tables, or managing the kitchen. It also specifies which area of the venue they will cover and any other responsibilities they’ll take on. This clarity drives productivity by allowing employees to immediately focus on their tasks, minimising downtime. And when the team knows exactly what’s expected of them, it helps create a seamless customer experience—guests are served more efficiently, tables are turned over faster, and operational bottlenecks are reduced.
- Shift Briefing: Keeping Teams Informed and Motivated
In hospitality, success depends on more than just getting the basics right. To stand out, you need to ensure your team is fully informed and motivated—something that’s not always easy in a busy workforce. Shift Briefing delivers this extra layer of engagement. Before each shift, team members receive a briefing that outlines key information, such as:
- Daily specials: Keeping the team updated on menu changes or promotional items they can upsell to guests.
- Incentives: Any performance-based rewards or targets for the day, keeping staff motivated to hit productivity and sales goals.
- Slack tasks: Employees are reminded of their responsibilities for when service is quiet, whether it’s setting up, restocking, or polishing cutlery.
Operations are much more than just a numbers game. While data is crucial for planning, staffing, and cost management, service is what sets successful operations apart. And, with constant pressure to deliver more with less, it’s easy to overlook just how much a business is built on people. By ensuring that every team member knows their role, is kept in the loop, and feels valued, you’re laying the groundwork for greater service consistency, stronger team morale, and better guest experiences.
by Alastair Scott | Sep 30, 2024 | Thought Leadership
One of the most frequent questions I get asked is, if you are an ops manager, how do you organise yourself to deliver on labour in the most effective way, and in the least amount of time? The flippant answer is that it depends on a number of factors like the manager, the objective and on the ops manager themselves. But answering the question in this way is not entirely useful, so I am going to try and set out a few guidelines that will help to deliver this.
1 – Setting objectives for teams is essential, but they must be clearly defined so that progress can be measured weekly. In the past, this was often tied to labour percentage targets. Today, it is more likely to involve aligning with deployment goals that meet corporate objectives—or even hitting specific cash targets. Surprisingly, many large businesses still prefer managing at the cash level, despite having advanced deployment systems. While assigning objectives is common practice, the real challenge lies in achieving them!
2 – Establishing templates for business thresholds is more effective than relying on weekly signoffs. While you might expect weekly signoffs to be necessary, they demand excessive effort to make work and encourage sites to see if they can get away with it. This either results in a time-consuming overhaul or a repetitive process that drains resources. Managing fifteen sites could easily turn into a full day’s work. Instead, I recommend agreeing on templates for sales thresholds. Well-designed templates streamline the process and can be quickly adjusted, saving time.
3 – Schedule a weekly visit to adjust, refine, and discuss operations. This may seem like a big commitment, but it ensures each site has a deep conversation about labour roughly four times a year—a small investment given its impact on cost, service, and sales. The challenge comes if this process slips. Without regular review, template rotas become outdated, get ignored, and new, unapproved rotas will surface. If you are not careful, you will end up reverting to the process of weekly sign-off, which is time-consuming and destructive.
4– What does an effective process look like? It involves several stages, varying in length based on time and the quality of the team. Nailing these stages and embedding them into your business as best practice will really make a difference to how you deliver on labour.
Stage 1 – Tasks: First, identify all tasks within the business, categorise them, and determine whether they are fixed or slack. It is crucial to coach new assistant managers and managers on this properly, so that slack tasks do not become fixed, and fixed tasks do not get moved to pre or post opening times.
Stage 2 – Management Rota: Creating a solid management rota is key to ensuring proper leadership without overstaffing on slower days. By carefully structuring the rota, you can maintain a balanced and efficient operation.
Stage 3 – Deployment: Matching supply and demand is essential. A rota must be designed to align with these needs while delivering excellent service throughout the week. Keeping in mind that the worst service often occurs when you are the most overstaffed. The key is finding the right balance to ensure efficiency without sacrificing service quality.
Stage 4 – Shift Planning and Leadership: This is the most crucial step. By agreeing a shift plan, you focus on the essential tasks and the necessary structures to ensure the leadership team is actively managing the business. It is about organising operations to be guest-focused and effective. This level of detail is vital for maintaining a well-run, efficient operation, both on busy days and during slower times.
Stage 5 – Kitchens: Kitchens have always been the major source of overspend in our industry. Too often, we have sacrificed front-of-house teams to add more staff in the kitchen. Kitchens alone, with their challenges of line structuring, prep, and pot washing, require immense attention. In fact, effectively managing a kitchen could easily take a full day or more. But the rewards for getting it right – both in terms of cost control and operational efficiency – are substantial.
Maintaining these steps may seem challenging, but they are a crucial part of running a successful business in today’s high-labour-cost environment. By implementing these guidelines, you can create a more efficient operation that not only controls labour costs but also delivers great service across the board. It is all about putting the right systems in place to get your teams and your business set up for success.
