The practical (and honest) method to recover margin in 30 days
Introduction
Let me introduce you to Marta. Restaurant manager, partner in a bistro, and a true juggler of shifts, suppliers, and customers who never have time. It's a regular Tuesday, 7:45 in the morning: she opens the camera, checks tickets, looks at the cash register… and suddenly feels that classic knot in her stomach. The tables are full, but the restaurant's profitability seems like a mirage. Payroll is heavy. Very.
That day, she wrote a big number on a napkin: her “labor cost percentage.” When she calculated it, she understood why she worked so much and earned so little.
The number that rules: your labor cost percentage
Marta started crunching numbers: Total labor cost / Total revenue x 100.
Here's an example: if you spend €13,520 on salaries and sell €42,000, your percentage is 32.2%. Tough, but very clear.
- Goal? In most profitable restaurants, the labor cost percentage is usually between 20% and 30% of sales. A fast casual can squeeze more; while a high-technique kitchen usually has a higher percentage.
- First step: Measure weekly. Without a number, there's no direction.
- Tip: use your TPV and the Guava (guavapp.com) operational dashboard to see sales versus hours in real time. If a slow Tuesday is at 35% at 1:00 PM… adjust before it costs you the day.
Preferential cost: the business health thermometer
Here's a metric that almost no one regularly looks at and everyone should: preferential cost = COGS (cost of goods sold) + labor cost. Keeping it below 60% of sales is a true treasure.
The old way
- Ordering “just in case.”
- Covering extra shifts “in case people come.”
- Working uncontrolled overtime “in case we don't finish.”
The new way
- Design a smart menu: fewer references, high turnover, with clear margins.
- Predictive scheduling with Guava (guavapp.com): shifts based on historical demand, weather, and reservations.
- Control waste and manage updated costing sheets: ensure purchases keep pace with sales, not the other way around.
Marta stopped ordering 6 references that only took up space in the fridge, and employees cross-trained: the one in the back office learned about the bar, and the one at the bar supported during service. The result: the same service, fewer idle hours.
Three levers to lower labor costs without losing experience
1) Schedule like a financier
- Schedule according to sales, not by habit.
- Review halfway through the shift. Are sales below 80% of what was planned? Close a station earlier. Are they above? Activate your “hour bank.”
- Set up alerts for overtime. Guava (guavapp.com) notifies you before a shift gets out of control.
2) Upskilling that pays payrolls
- 30-minute express training at the start of each shift: a key dish, a technique, or how to upsell.
- Versatility: each team member masters at least 2 positions. Fewer gaps, fewer idle hours.
- Incentivize speed without sacrificing quality: service times, average check, and reviews.
3) Data on the plate
- Daily dashboard: sales per hour, labor cost per hour, previous day's COGS.
- 10-minute meeting after service: what went well, what needs adjusting tomorrow.
- Change menus based on margin, not just preferences. The best-selling and most profitable dishes stay; expensive whims go.
In just 4 weeks, Marta went from 34% to 26% labor cost. It wasn't magic. It was method: measure, decide, and adjust. And yes, now she sleeps better.
Does this scene sound familiar?
It's 10:10 PM on Friday. The dining room is full, the kitchen is in full swing, and you're thinking about the end-of-month payroll. Honest question: are you managing based on feelings or real-time numbers? If it's the former, you're letting money slip away. If you switch to the latter, you'll see how the business pays you back… in the till.
