Restaurant Labor Cost and How to Optimize It

by Aaron Allen
Restaurant Consultant, Speaker & Industry Analyst
Aaron Allen & Associates

It’s clear that restaurant labor cost optimization will become critical to any business open today seeking to still be alive in five years. It’s not that managing labor is any more or less important than it was in the past, it’s that the sophistication required to manage and optimize it going forward will prove far more challenging. As survival-of-the-fittest instincts kick in for the strong to evolve or die, they will look for every competitive edge they claw into their toolkit, including killing off the weaker of their kind that didn’t prepare or avail themselves with the best offensive and defensive strategies.

If this all sounds like one of those futuristic game shows where friends compete for their lives until only one or a few are left standing, that is, sadly, sort of the case. Globally, we will soon reach the point where there are so many more people desiring to eat in restaurants than there are people willing to work in them for the wages offered, that for both factors of costs to operators and changing demands of consumers there will be a seismic shift in restaurant economic models, and new tools and tactics will be devised and deployed in the battle for a share of consumer stomachs.

Thinking through the following items will help to plan out a successful strategy to optimize restaurant labor costs.

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