Letting team members in on the nitty gritty financials of your operation can help engage them in the mission to get out of the red by generating revenue or cutting costs. The key is nailing what numbers to track and who needs to know about them. Here's how some operators have tackled the challenge.
When faced with payroll cuts to balance the budget, Heather Smith, food services director at Cardinal Community School District in Eldon, Iowa, put the reduced hours in perspective. “We made sure that they actually understood how our department worked, and what it took to make it work,” Smith says. “We explained how foodservices is a standalone department from the school; no one had ever told them that before.”
Staff commonly complained about the school’s ovens and sinks, so she told them how much they would need to save to update the kitchen, and how payroll cuts fit into that plan. By the next year, foodservices was able to restore payroll and even hire a new team member.
At Purdue University in West Lafayette, Ind., Greg Minner, director of dining and catering, wanted to bring food costs down 10% to 20%. Not only does Minner’s team regularly comparison-shop their 100 most-purchased items, they also designate two production chefs who track food costs and calculate cost per plate. “Everyone that orders or takes inventory needs to know the costs of those items,” he says.
With that knowledge concentrated, Purdue Dining can swiftly make opportunity buys and adjust to rising food costs across all dining locations. Monthly food cost metrics are distributed to the team and the university’s student life vice provost and president; in the first year after implementing these processes, dining saved $315,000 on food purchasing.
Dining at Edward-Elmhurst Health in Elmhurst, Ill., is run like a for-profit restaurant—with a constant eye on sales, says Dave Reeves, director of hospitality services. During daily staff meetings, Reeves includes a short segment about current financials and goals. Reeves’ managers know sales numbers down to the penny, so they can pull items that don’t sell and push items that do.
“Working closely with your financial department is really important,” he says. “People need to be clued in so that they can be engaged in helping to reach future goals for the operation.”