As Uncle Nicks stated; “It Depends”
A good starting point is to have your combined food & labor cost under 55% , being under 50% is even better.
My labor costs are all over the place in the winter due to our wildly varying sales amounts affected by our weather, tourist activities, snowmobile trail conditions, and ice-fishing.
When we are running hard in our summer tourist months, I typically see 10% or less on labor costs on a daily basis, i’ve seen them under 5% at times. But it all depends on how much product that we have going out the doors. I Love seeing large carry-out orders meant to feed 30-50 people, it moves massive product without a buttload of labor.
If I was in your position, I’d look at the current food cost ratio, try to get a good estimate on your current labor costs, and try to nail that “55% or less” benchmark by making the needed changes to get there.
These are some projections/calculations that almost border on alchemy, but it can be done.
A chef I worked under decades ago told me something that made real good sense, he said;
“Your profitability is not determined by what you’re paying for your meats, it is instead determined by what you are paying for the lettuce”
Translation; Watch the pennies and the nickels and the Dollars will take care of themselves.
Simple things such as excessive chemical usage, pizza boxes, customer discounts, employee meals, Etc Etc, They all add up to substantial monetary figures over a few months.
My sysco rep recently asked why I do not get some of our paper/disposable items through him, I showed him the price difference, and he says “Thats nothing” until I showed him our annual usage, and paying those extra few cents per piece added up to in only 1 year.
Good luck with your project and I hope you can get things down to where they need to be. it won’t be an overnight task.
