Operate A Multi-Location Restaurant? Avoid These 7 Mistakes

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multi-location restaurant

One of the unique challenges of the restaurant business is the simultaneous coordination of many different factors: staff, payroll, scheduling, operations and more. Now imagine multiplying that across locations. Enter the multi-location restaurant.

In this article, we will cover seven common mistakes multi-location restaurant operators make and how to avoid them from the very beginning of your expansion process.

What is a multi-location restaurant?

A restaurant opened in more than one location is called a multi-location restaurant. A multi-location restaurant could be as small as two independently owned locations or as large as an international franchise or chain. 

Independently operated restaurants have no constraints on how they prepare their food. But chain restaurants have to ensure consistency of recipes and servings without having a single, centralized kitchen to serve all the outlets. Instead, each restaurant makes its food and must plan and train employees carefully to ensure customers receive the chain’s trademark style of food.

Here are seven mistakes you should watch out for when running a multi-location restaurant: 

1 - Communication breakdowns.

If your restaurant is a small, single-location mom-and-pop shop, you can probably get away with miscommunication between departments. You may even barely notice when it's happened. But if you're running a multi-location restaurant chain, communication breakdowns will sink you.

Even in a small business, it's crucial to have systems and processes that ensure information flows freely from one part of the company to another. Imagine what it would look like if your chef and your manager didn't talk to each other about the day's ingredients. A disaster!

But in a multi-location restaurant chain, the stakes are even higher. If your restaurants aren't getting the same information simultaneously, they can't ensure they offer customers a similar experience across locations. That leads to bad press (and possibly public safety issues), hurting your entire chain.

How to Solve it 

  • Be clear about expectations and responsibilities from the beginning — this will go a long way!
  • Text and email reminders of what's coming next can help keep everyone on track.
  • Consider using a scheduling app that allows staff to easily message their managers and others for work requests. 
  • Encourage open communication. Your staff should feel comfortable approaching you when there is a problem or discussing scheduling preferences.
  • Make sure everyone has their own device. When your employees have individual devices (laptops, phones, tablets) connected to the network, it's easier for them to be available for feedback and questions.

2 - Digitize in-person visits.

When you have multiple locations, the last thing you want to do is be inefficient with your time. You should avoid the temptation to stop by a restaurant or two to ensure everything runs smoothly.

Instead of going into stores, take advantage of the data you've collected online and technology that helps you get a sense of how things are going without physically being there.

For example, when ordering inventory and supplies, don't just call your head office and tell them what you need. Instead, automate your operations so that each location can track the products they need and place orders automatically.

You can also automate tasks like time tracking, and scheduling by using facial recognition technology, and setting up alerts when staff get sent into overtime or clock in at a time that is outside their allotted scheduled hours.

Recently, a client who started using these tech tools to digitize their in-person visits saved over $91,200 by doing fewer in-person visits, and leveraging tech to automate instead.

How to solve it

  • Use an automated reconciliation tool.
  • Set up your inventory system to automatically alert your suppliers when you're running out of an item.
  • Get rid of all paper forms and have employees use digital ones instead.
  • Make sure your POS system can handle multiple locations with ease. 

The solution is to automate your processes. You can collect enough data to create forecasted schedules. Once you've established a data history, you can create templates for plans and then double-check your predicted schedule's accuracy—which brings us to the next point on the importance of informed decisions.

multi-location restaurant software

3 - Not making data-driven decisions.

Data is the secret sauce that can set your multi-location restaurant apart from the crowd. But it's not enough to gather data—you need to be able to act on it in a way that helps you run a better business at every level.

The most significant mistake multi-location restaurants make is not making data-driven decisions. Without data, you will have no facts, just guesses and intuitions. How do you know if your growth is sustainable?

Sure, your accountants may give you a report every quarter or month, but do you want to wait until then to make decisions? No! You want up-to-the-second insight into where you're spending and earning money.

If you don't have the tools to look at your numbers, you're likely to make decisions based on intuition rather than facts. You should be able to see what your margins are for each location to identify where to make improvements.

How to solve it

  • Start by identifying your target metrics.
  • Gather and analyze the data you need for those metrics.
  • Share the data you've gathered with everyone who needs to know the information and ensure that everyone has access to it in real-time.
  • Create a culture of accountability where everyone is held responsible for their use of the data, from top-level executives down to the newest employee.
  • Integrate your POS and workforce management systems to generate labor utilization (labor vs. sales) reports. This report lets you know how much money your business makes per employee.
  • Use smart restaurant scheduling software to forecast schedules based on sales and traffic so that you can stay alert for any high or low points in your business.
  • Take action based on what you find in your data.

Data is amazing. It's like having a crystal ball that tells you what's going on in your business and what will happen in the future. Use it to make better decisions.

4 - Putting your business at risk.

When businesses expand to multiple locations, they often find they're putting their business at risk. Why? because complying with labor laws can be more complex when operating across several states. 

Compliance and consistency are essential for  multi-location restaurants that operate in different countries to avoid risk. While most restaurant owners understand this in theory, there's a little-known danger that many restaurateurs overlook: compliance with labor laws when it comes to hourly employees.

For example, there are laws regarding the amount of time an employee can work before accruing a break, or staff tax, holiday and overtime payroll calculations. If you don't know the rules in each state your employees are working in and comply with them, you'll be putting yourself at risk of being sued or fined.

How to solve it

If your employees are not following labor compliance laws, you'll be putting your company at serious risk for lawsuits and fines. To avoid this kind of business risk, you need a system that:

  • Allows for each employee to clock in and out from any location.
  • Monitors, when an employee has worked the maximum, permitted hours in a day and shares an alert to inform management .
  • Automatically calculates the total hours worked each week and complies with time off regulations.
  • Automates overtime, tax, and holiday calculations based on different provinces or states.
  • Tracks shifts and schedule changes to ensure compliance with wage laws (including overtime).

Ultimately, time tracking technology with employee scheduling and break management features are essential for multi-location restaurants.

Time tracking technology uses facial recognition features to confirm that the right employee is working at the right time—and taking breaks when required. This software also allows managers to set up break or overtime alerts to be informed when an employee is at risk of violating compliance.  

This technology also tracks timekeeping and other HR functions. It can help companies reduce liability and other mistakes in manual timekeeping.

In addition to time tracking, payroll software for multi-location restaurants that is able to function and automate calculations in different provinces and states is also key.

5 - Challenges with managing the employee life cycle. 

The employee life cycle is a complicated one to manage.

When dealing with multiple locations, you must ensure that your hiring practices, retention strategies, onboarding systems, and training are all in sync. If they're not, then you could find yourself in a situation where:

  • An employee gets scheduled at two different locations on the same day—or worse, simultaneously!
  • You hire too many employees at one location and not enough at another.
  • Your onboarding process leaves your new hires confused about what to do when they start their first day.
  • Employee retention rates are lower than you'd like them to be—but you're unsure why or how to fix it.
  • An employee gets fired from one location and then applies for another job with your company, in a restaurant unaware of what happened at the previous location.
  • Different locations have wildly different onboarding processes and expectations for new employees.

These are just a few ways in which it can go wrong when managing an employee's life cycle across multiple locations.

How to solve it

The right tools can make the employee life cycle easier for yourself and your staff.

Suppose you tried to handle these processes with separate tools or an offline system. Using multiple tools would make it hard to ensure that each step is done right, and you wouldn't get the most out of your workforce.

To solve this challenge, restaurants are now using an HRIS system created for multi-location restaurants. Technology like this will allow you to use the entire suite of features—including applicant tracking, interview templates, and self-onboarding and digitization tools—even if you have employees at multiple locations.

These features are what you need to be able to efficiently hire employees at multiple locations while keeping track of their progress every step of the way.

6 - Team and management breakdowns.

One of the most important things to have when operating a multi-location restaurant is a team structure. An organized system is essential for locations that are not near each other so that you can avoid simultaneous breakdowns in service. 

You'll want to make sure that everyone knows who is in charge of what, and how to reach them. For example, if a manager goes out of town, there should be someone else who can handle their duties in their absence.

Also, make sure that everyone knows the critical members of your team who are available to help them at all times—there's nothing worse than having an issue arise on your busiest day and not knowing who to turn to for help. That way, everyone knows who they should go to with questions and concerns.

When your employees know you care about their professional growth and development, they will feel engaged at work. A motivated workforce is essential for customer service, which translates into increased sales for your business.

How to solve it

You must clearly understand how each person on your team fits into your business's overall function, especially if you're managing multiple locations. 

If you're managing multiple locations, there are some standard best practices that you should follow:

  • A manager should overseef each location. They should report directly to you.
  • Your managers should train their teams using an approved training program that focuses on customer service and food safety standards.
  • Managers should regularly perform inspections at each store location and document everything they find. They must file reports of violations with the proper authorities.
  • Use software to set clear employee and manager roles (and wages).

After all, the most important thing about an effective restaurant management team is to have a clear structure in place.

A manager's job is no longer just about doing their tasks and keeping the floor organized. It's about delegating responsibilities to make sure you're running a well-oiled machine. An excellent structure for an organization is a regional general manager, general manager, assistant general manager, shift leader, senior server/ trainer, server and trainee.

7 - Not having consistent branding.

Whether you have one store or five, branding is essential. It builds trust and relationships with your customers and helps them know what to expect from you.

But the benefits of branding don't stop there.

When you have consistent branding across all your locations, it also helps you manage costs because you know exactly how much it costs to make each item, how much it costs for a product, and how much your Cost of Goods Sold (COGS) is for every single thing that goes out the door.

Most importantly, when your branding is consistent across all locations, customers know what to expect from every place they visit.

How to solve it

If you were to start at the very beginning, it would be wise to start with a concept. From there, create brand visuals, guidelines, and a thoughtfully designed menu.

The next thing to do is create detailed operating procedures for every aspect of your restaurant operations—from food preparation to customer service. 
Then train each employee according to those procedures, ensuring they understand the importance of following them strictly. 

Once everyone is on board, use software to hold employees accountable for following the procedures at every location by collecting data on their actions and behavior (and if something goes wrong), using that information to communicate with employees about how they can improve.

Automation is key.

The above list is by no means an exhaustive list of mistakes you should avoid when operating a multi-location restaurant, but it's a great place to start. We hope this helped! If you need help managing your people operations at a multiple-location restaurant chain we recommend you choose an easy, all-in-one platform like Push. 

Push helps you streamline payroll, HR, scheduling, and time tracking from one easy-to-use platform built for multiple-location restaurants. 

You can toggle back and forth between locations and manage many places at once in a fraction of the time. And it'll allow you to automate tasks and streamline everything, saving time and money.

Want to learn more ways to increase your restaurant profits without spending a dime? Download our our free guide below!

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April 2022


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