If you are a hospitality business manager, you know that labor costs make up a significant portion of your budget. You have to have a certain number of employees to run the place, but controlling labor costs can be challenging for any manager. How do you know if someone is working too much, or maybe you questioning why someone keeps calling out? There is a simple way to control labor costs, and that is through time clock software.
This software is easy to use and allows you to see what your labor costs are going. It also lets you have complete control over what is going on in your business day in and day out. You may feel in the dark right now when it comes to employee time tracking, but with the help of an online time clock, you can stay up-to-date with what’s going on with your team and understand precisely how it affects your business.
Let’s take a look at the different ways that an online timecard system can help get your labor costs under control
Understanding Your Labor Costs With Time Clock Software
If you are still tracking employee work hours by hand, it will be challenging to figure out where your labor costs are going. You may have got away with merely guessing how much you are spending on labor costs, but you need to be accurate to ensure long-term success.
Using online time clock software, you can see precisely how much time was spent working on a specific project, task, or for a particular client. You can see exactly how much processing payroll costs and compare that to your revenue to determine if you can afford to bring on more employees or perhaps let some go. Most systems come equipped with reporting options that allow you to determine how much money was made compared to hours worked
Can You Fix The Schedule To Cut Costs?
One of the most important questions you can ask yourself as a manager or business owner is where you can cut costs? For most, this can be an uncomfortable question because you want to pay your employees adequately for their time worked and ensure they’re scheduled for enough shifts to make a liveable wage. However, if you determine employees are working shifts with very little profit, you may need to think about cutting the shift.
Here are some other ways you could cut costs
Overtime
Overtime is a significant source of labor costs. When an employee incurs overtime, they’re required to be paid one and a half times their regular rate. If you have multiple employees working overtime each day or week, those costs can quickly get out of control.
With time clock software, you can get notified if an employee is approaching daily or weekly overtime. You can then either approve the overtime or ask the employee to leave early and bring in someone else who hasn’t yet received the overtime threshold.
Turnover
Using online timesheet software is one of the best ways to understand which shift has the highest turnover rate and ask yourself why and what can change. Hiring new employees is a tedious task, expensive because you have to train them on the job, and it takes a lot of time.
Understanding why and when people leave is crucial to running your business. With time clock software, you can get a detailed view of shift information to determine what shifts need to be adjusted or how they can be improved to reduce turnover from happening.
Scheduling
If you’re manually scheduling your employees, there’s likely some waste occurring when it comes to your labor costs. Manual scheduling is prone to errors, shift overlaps and doesn’t account for employee preferences or your workers’ skill sets. If an employee is not adequately trained or doesn’t have the proper skills to complete a job, they’ll take longer and are much more likely to get injured.
Online employee timesheet software allows you to schedule more efficiently and account for employee preferences and abilities. If an employee can’t work or calls in, you can easily find someone to replace them. With a birds-eye view of scheduling, you can also prevent overtime costs before they even occur.
Using modern cloud-based time clock software can truly help change your business for the better. Soon you will be able to run it more easily and efficiently than ever before. On top of that, you will ensure you are spending the appropriate amount on labor costs.
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