Labor Help Please!

We have been in business for 3-years and I need help with Labor. We are a counter service model with 40-seats. We only use 3rd Party delivery. About 70% dine in. Limited menu, with only 18" Pies, Subs and salads. We use deck ovens and make dough/sauce daily. We average $12k-$15k per week. Open 63 hours per week.

Labor is consistently between 35%-38%, all in including Shift Lead, Hourly, Workers Comp and Payroll taxes. We have another shop, whole different animal, so I do have an area Manager who is in charge of both. Her salary ($40k annual) is included in our labor % stated above.

Hourly wages range from $9-$11 per hour.

Staffing on a $1500 day:

1 Prep: 8am-11am
1 Shift Lead 10am-4pm
1 Pizzaioli 10:30am-2pm
1 Dishtanker 2pm-4pm

1 Shift Lead 4pm-9pm
1 Pizzaioli 4pm-8pm
1 Pizzaioli 5pm-9pm
1 Cashier 5pm-9pm
1 Dishtanker 6pm-9pm

On Fri & Sat (Avg $3k each day) we add 1-2 Pizzaiolis (3 Max) and add 1-Cashier (2 Max).

The team “seems” busy, especially on Fri & Sat. I can not figure out how to get labor down to the 22-25% that I continuall hear I need. Our shop is only doing about 7% Net Profit. Our food & bev cost is always around 26-28%. Rent is 2,400 per month. All other expenses are in line and have $0 debt.

Way too much work to take home 7% profit. Love the business. Our Pie has won a lot of awards and we are very community connected. But…the $$$ just is not there. Any advice is so welcome and needed!

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So my business differs quite a bit from yours, but I figured I’d share mine with you to see if it can help you any. We are delivery / carry out only, operating from 11 AM to 10 PM 7 days a week, and only volume about 7 - 8 per week. We are unfortunately in a very competitive market, with a very large number of pizza shops (both chain, and independent) in a small area. By Net Sales we are approximately 80% Delivery, 20% Pick Up. No dine in option.

Our Friday / Saturday is usually around the $1500 day you quoted, so I will compare my Friday and Saturday to your traditional weekday.

Open Shift:

Shift Leader 10:30 AM to 4:00 PM
Delivery Driver 11:00 AM to 4:00 PM

During this time period we typically do $300 to $500 in sales. Some times the deliveries can get a little hair (45 minute to the door time) but typically they are to them within 35 minutes. The driver, in between deliveries, will typically cut the vegetables, and maintain dishes. In busier times they will usually assemble subs, salads, and other simpler items. The shift leader will typically handle the majority of the make duties, prepare the sauce, fill and stock the makeline with the precooked meat toppings, and handle all phone calls and counter work. Being a smaller store, I typically handle the day time shift leader position myself, and have never had any problem keeping up with the demand, or work. Every now and again the larger dishes (dough trays, sauce bucket, etc) may fall behind but it is an easy pick up for dinner crew.

Night Shift:

Opening Shift Leader: 4:00 PM to Rush (7:30 / 8:00 PM)
Opening Delivery Driver 4:00 PM to Rush (7:00 / 7:30 PM)
Closing Shift Leader: 4:00 PM to Close (10:30 / 11:00 PM)
Rush Driver: 4:30 PM to 8:30 PM
Late Driver: 5:00 PM to 9:30 PM
Closing Driver: 5:30 PM to Close (10:30 / 11:00 PM)
Rush Instore: 4:30 PM to Rush (7:30 / 8:00 PM)
Late Instore: 5:00 PM to 8:30 PM
Closing Instore: 5:30 PM to 9:30 PM

During this time period the opening driver would focus on finishing any of the aforementioned duties if applicable, and taking deliveries only in an emergency situation until completed, and then would maintain rotation until the rush. Typically all in-stores jump from station to station, with each one being assigned a primary, a sample as follows:

Opening Shift Leader: Dough / Sauce
Rush Instore: Phones / Cash Drawer
Late Instore: Sub / Salad Station
Closing Instore: Pizza Makeline
Closing Shift Leader: Ovens / Routing

The delivery driver’s are all cross trained, and when not on deliveries would assist where needed. Typically only one or two drivers are instore at a time though, and they usually are on the dishes, or bagging their orders. If we are running behind on the inside, they will jump on to one of the makelines (whichever is further behind) to catch up on orders. Prior to leaving the rush instore will typically clean the customer service area / lobby, the late instore the sub / salad station, and the closing instore the pizza makeline. Once sales start to slow, the opening shift leader and driver would prepare a batch or two of dough (depending on sales volume), roll the dough, and cross stack in walk in prior to leaving.

The rush driver was typically responsible for ensuring any small wares used throughout the rush (pizza lexans, spoodles, portion cups, etc) are washed and put away prior to being cashed out. The late driver would finish any of the bulk dishes (makeline catch trays, dough bowl, sauce bucket, etc), prior to being cashed out. The closing driver would sweep, mop, and wipe down any remaining counters, while the closing shift leader would count down the cash for deposit, down stack the dough for the next day, and count inventory.

On this past Saturday, we were actually short one employee position (the assistant manager who is normally my closing shift leader was off, so I covered both shifts), and were essentially short 1 in store position for the night. On this day however we did just shy of $1,50o Net Sales. Our labor % (minus my salary so that you could plug and play with your mandatory labor cost for an opening / closing manager) was 15.52%. This accounted for all in store and driver labor, just no manager labor. For full disclosure, we are in Florida, and have a lower cost of living than most places. Our instore staff make a small bit about minimum wage ($8.50 per hour), and our drivers make a split pay ($8.25 per hour in store, $5.23 per hour on the road). They end up averaging $18 to $24 per hour after gratuities, not counting any paid mileage reimbursement. Our instore staff typically makes another $2 to $3 per hour after in house gratuities.

Our average out the door time for the day was 23 Minutes and 28 Seconds, with the oldest being 41 Minutes and 14 seconds. Only 8.47% of delivery orders went out past 35 minutes. So service was not hindered by the above staffing, and everything got done.

I am not sure if any of this novel helps you, in your environment, but I hope it at least provides some helpful insight to another operation. I will say one key component, is that the above numbers and service only works when I am there. I have been doing DELCO (Delivery / Carryout) for over 14 years (started at 16 for Domino’s, then worked as a Store Manager / Area Supervisor for Papa John’s, prior to opening my own independent). When I am not there, the labor skyrockets, and the service drops. Simply put, many managers are good at going through the motions, but fail at the proper execution. It requires someone who is decisive, and task oriented, to keep the flow going, and the staff moving.

Raise prices.
Sell slices.

Very insightful. So what it comes down to is unless the owner works it…really hard to make $$$.

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Essentially, or a manager on a lower salary higher bonus structure. Someone who will be as hungry for the success as you. In my humble opinion

That 22%-25% labor that you hear about probably doesn’t include payrolls taxes and workers comp.

I don’t understand your numbers - using your sample of a $1500 day - you have 30.5 labor hours. And at your max rate of $11/hr that is $335.50 or 22.3% worst case. Add another $55 for your supervisor that makes it 26.2%. Even after adding in payroll tax and workers comp, it shouldn’t bring it anywhere near 35%.

Hi…hours total to 34.5. So, $379 in labor $. $1500 is gross, so back out 5% in discounts, $1,425 Net. $379/$1,425= 27%. In Ohio, all the payroll taxes, unemployment, are 11% of payroll, so 30% + Managers Salary, another 10%.

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I take it since you have an Area Manager, you do not have a General Manager at each location? I did not see that position on your list.